As healthcare continues to evolve, different players in the industry are tasked with specific roles and responsibilities. One of these players is the 340B program, which was created to help eligible healthcare providers purchase discounted drugs for their patients.
In the context of the 340B program, a contract pharmacy is a pharmacy that has an agreement with a covered entity to dispense 340B discounted drugs to eligible patients. This arrangement has raised a lot of questions about whether contract pharmacies are considered business associates.
In order to understand whether a 340B contract pharmacy is a business associate, it is important to first define what a business associate is. According to the Health Insurance Portability and Accountability Act (HIPAA), a business associate is defined as “a person or entity that performs certain functions or activities that involve the use or disclosure of protected health information (PHI) on behalf of, or provides services to, a covered entity.”
In the case of a 340B contract pharmacy, the pharmacy is partnering with a covered entity to provide discounted drugs to eligible patients. However, it is important to note that the 340B program operates under Section 340B of the Public Health Service Act, which is a separate federal law from HIPAA.
While the 340B program is not subject to HIPAA regulations, covered entities that participate in the program are required to comply with HIPAA rules when it comes to protecting patient information. This means that covered entities must ensure that their partners, including contract pharmacies, are also compliant with HIPAA regulations if they are handling PHI.
Based on this information, it is safe to say that a 340B contract pharmacy could be considered a business associate if they are handling PHI on behalf of a covered entity. However, it ultimately depends on the specifics of each partnership agreement and the level of involvement the pharmacy has in handling PHI.
In conclusion, while the 340B program is not subject to HIPAA regulations, covered entities participating in the program must still comply with HIPAA rules when it comes to protecting patient information. As such, 340B contract pharmacies should be evaluated on a case-by-case basis to determine whether they qualify as business associates. Covered entities should work closely with their contract pharmacies to ensure that any PHI is protected and that both parties are in compliance with all applicable regulations.
