340B Dispute Resolution: How a Covered Entity Files

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The Health and Human Services Department final rule at 89 FR 28643 has been in force since June 18, 2024. It revises the 340B administrative dispute resolution process in 42 CFR Part 10 for all drug manufacturers and covered entities that participate in the 340B Program (RIN 0906-AB28). A covered entity files a written claim to the Office of Pharmacy Affairs within 3 years of the date of the alleged violation; the process covers defined claim types only and is not a route to challenge contract-pharmacy policy.

What is in force now?

The DATES paragraph states, verbatim, "This final rule is effective June 18, 2024." The document was published April 19, 2024. A pharmacy or compliance lead at a community health center or other covered entity is working under that live process today.

This brief sits inside a sealed index of 1086 U.S. federal rules issued by 11 agencies between September 1, 2023 and September 1, 2026. Counts and the window are fixed. They are not a forecast.

Source: Federal Register / eCFR.

What does the rule require?

The abstract states that the Health Resources and Services Administration administers section 340B of the Public Health Service Act, referred to as the 340B Drug Pricing Program or the 340B Program. The final rule applies to all drug manufacturers and covered entities that participate in the 340B Program. It sets forth the requirements and procedures for the 340B Program's administrative dispute resolution process and revises the process set forth in the Code of Federal Regulations.

Under the 340B statute as the preamble restates it, the ADR process is to resolve (1) claims by covered entities that they have been overcharged for covered outpatient drugs by manufacturers and (2) claims by manufacturers, after a manufacturer has conducted an audit as authorized by section 340B(a)(5)(C) of the PHS Act, that a covered entity has violated the prohibition on diversion or duplicate discounts. HHS states that the process should be considered only when good-faith efforts to resolve disputes independently have been exhausted and failed.

The filing rule HHS finalized is that a covered entity or manufacturer must file a 340B ADR claim in writing to OPA within 3 years of the date of the alleged violation. Before filing, each stakeholder must provide appropriate documentation, including documentation of communication with the opposing party to resolve the matter in good faith. A covered entity must provide documentation to support that it has been overcharged. Covered entities are not permitted to file a claim against multiple manufacturers.

The 2020 final rule had instituted a minimum threshold of a dollar amount the rule does not restate here, or equitable relief likely worth more than a dollar amount the rule does not restate here, before a petition could be filed. HHS is not finalizing a minimum threshold for accessing the ADR process under this rule. That is the monetary threshold this page must carry: the floor is gone. The rule does not say every small dispute should be filed. It says flexibility is maintained with respect to the amount of damages, and that parties should evaluate whether ADR is appropriate for minor or de minimis claims given the time and resource investment.

Which claims does ADR cover, and which does it not?

The permitted claims are the statutory set the preamble repeats: covered-entity overcharge claims, and manufacturer claims after an audit for diversion or duplicate discounts. HHS states that the ADR process should be reserved for those disputes set forth in the statutory ADR provision.

The limitation is as important as the filing path. The process is not a general 340B court. The preamble discusses manufacturer restrictions on certain covered entities' use of contract pharmacies as background. It does not list a challenge to contract-pharmacy policy as a permitted ADR claim type. Where a dispute is about something other than overcharge, diversion, or duplicate discount, the rule does not say ADR is the route.

Manufacturer claims have a statutory precondition the rule repeats: the manufacturer must have conducted an audit of the covered entity pursuant to section 340B(a)(5)(C) of the PHS Act before bringing a diversion or duplicate-discount claim. A covered entity overcharge claim does not carry that manufacturer-audit precondition.

The rule does not say ADR replaces HRSA audits. The rule does not say a panel will rewrite 340B ceiling-price methodology. The rule does not state a civil-penalty dollar amount for failing to file. Those silences are part of the scope.

Who has to comply?

The abstract is explicit: the final rule will apply to all drug manufacturers and covered entities that participate in the 340B Program. Eligible covered entity types are defined in section 340B(a)(4) of the PHS Act, as the preamble notes. This page is written for a pharmacy or compliance lead at a community health center or other covered entity who needs to know whether a dispute qualifies and how a claim is filed.

OPA staff serve on 340B ADR Panels under the structure HHS finalized. The preamble states that the Secretary appoints a roster of OPA staff, and the OPA Director selects at least three members for each panel. That is process design, not a covered-entity filing duty.

A practice that buys 340B drugs through a covered-entity pharmacy still needs a human owner for the claim file: the overcharge evidence, the good-faith correspondence, and the three-year clock. Software does not become the petitioner.

Where do healthcare practices commonly fall short?

Covered entities commonly treat ADR as unavailable because they remember the a dollar amount the rule does not restate here floor from the 2020 rule. That floor is not in the June 18, 2024 process. The opposite error is also common: treating ADR as a general grievance desk for contract-pharmacy access, eligibility arguments, or pricing-policy fights the rule does not list as permitted claims.

A second pattern is a missing good-faith file. The rule requires documentation of communication with the opposing party before filing. A spreadsheet of alleged overcharges without the correspondence is not the packet the process describes.

A third pattern is clock blindness. The claim must be filed in writing to OPA within 3 years of the date of the alleged violation. Teams that discover an overcharge in year four of a pricing dispute, with no filing and no preserved record, are outside the deadline the rule states. The rule does not say the clock pauses while a manufacturer "looks into it."

A fourth pattern is joining manufacturers in one petition. Covered entities are not permitted to file a claim against multiple manufacturers. A combined vendor complaint is not the claim the preamble describes.

This page does not invent enforcement statistics. Those numbers are not in the closed fact set.

How can a covered entity self-audit now?

Work the dispute as a file, not as a feeling that "HRSA should know."

1. Name the claim type in the words the rule uses: overcharge of a covered outpatient drug, or (if you are the manufacturer side) diversion or duplicate discount after an audit.

2. If the issue is contract-pharmacy policy or another topic the permitted-claim list does not include, stop and send the question to counsel. The rule does not say ADR is that route.

3. Date the alleged violation and measure 3 years. If the window is closed, the rule does not say OPA must accept the claim.

4. Assemble good-faith correspondence with the opposing party and the overcharge documentation a covered entity must provide.

5. Confirm the claim names one manufacturer, not several.

6. If the file is complete, the human compliance owner decides whether to file in writing to OPA. If it is not complete, route the gap, do not file a hollow claim.

Verity 340B is 340B program-management software used to track eligibility, purchases, and compliance work at covered entities. athenaOne is the electronic health record and practice-management platform many community practices already run for encounters, billing, and medication records. In the readiness pass, use Verity 340B to locate purchase and ceiling-price evidence that might support an overcharge file, and use athenaOne only as the clinical and billing context for whether a drug was dispensed in the covered-entity workflow. Neither product files the ADR claim. Neither product decides that a dispute is an overcharge within the meaning of 42 CFR Part 10.

Related reading on this site includes hospital price transparency standard charges, the Medicare program healthcare compliance brief, and the IRF therapy and IDT timing guide. Those pages are other healthcare duties. This page is the 340B ADR filing path.

What can be automated and what needs a person?

Propagate the coverage and billing rule change across the practice: each affected policy, code, or workflow maps to the change it must reflect. US Tech Automations flags workflows still running on the old a dollar amount the rule does not restate here threshold or on an unbounded "file anything" view of ADR, and routes the update to the compliance owner.

A workflow can watch a dated alleged-violation field, assemble a folder for correspondence, and open a task when the three-year mark is approaching. A workflow cannot decide that an invoice difference is an overcharge, that good-faith efforts have been exhausted, or that a contract-pharmacy dispute belongs in ADR. Those are human readings of 89 FR 28643.

US Tech Automations is the flag-and-route layer, not a petitioner and not a panel. The rule requires a written claim to OPA, a defined claim type, a three-year clock, and a good-faith file. The covered entity still owns those.

The rule does not say how many days OPA has to docket a new claim in every case. The rule does not state a penalty for a covered entity that never files. Where the rule is silent, write "the rule does not say" and leave the question with counsel.

Key Takeaways

• The HHS rule at 89 FR 28643 (RIN 0906-AB28) has been effective since June 18, 2024 and revises 42 CFR Part 10.

• It applies to all drug manufacturers and covered entities that participate in the 340B Program.

• A claim is filed in writing to OPA within 3 years of the date of the alleged violation, after good-faith documentation with the opposing party.

• HHS did not finalize the 2020 a dollar amount the rule does not restate here minimum threshold; there is no dollar floor for access.

• Permitted claims are covered-entity overcharges and manufacturer audit-based diversion or duplicate-discount claims, not a general challenge to contract-pharmacy policy.

• Automation can flag stale threshold language and approaching clocks; a compliance owner still classifies the claim and decides whether to file.

What questions come up in practice?

Is there still a a dollar amount the rule does not restate here filing floor?

No. The preamble states that HHS is not finalizing a minimum threshold for accessing the ADR process. The 2020 floor of a dollar amount the rule does not restate here is what this rule removed. Parties should still evaluate whether a minor claim belongs in ADR.

How long does a covered entity have to file?

A covered entity or manufacturer must file a 340B ADR claim in writing to OPA within 3 years of the date of the alleged violation, according to the final rule discussion. The rule does not say the clock is tolled by informal emails.

Can ADR be used to challenge contract-pharmacy policy?

The permitted claims the rule describes are overcharge, diversion, and duplicate discount. It does not list a contract-pharmacy policy challenge as a permitted claim type. The rule does not say ADR is that route.

Do the parties have to try to resolve the dispute first?

Yes. HHS states that ADR should be considered only when good-faith efforts have been exhausted and failed, and the filing discussion requires documentation of communication with the opposing party to resolve the matter in good faith.

Can one claim name several manufacturers?

No. The preamble states that covered entities are not permitted to file a claim against multiple manufacturers.

Can Verity 340B or athenaOne file the claim?

No. Those systems can hold purchase, eligibility, and encounter records. A human compliance owner files in writing to OPA if the claim type, clock, and good-faith file support it.

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Every date, citation, RIN, CFR reference, and figure in these posts is copied verbatim from the Federal Register and eCFR as of the snapshot date. Nothing is estimated, modeled, or extrapolated. This is not legal or tax advice.

This page is for informational purposes only. It is not legal or tax advice, does not create an attorney-client relationship, and is not a substitute for the rule. Read 89 FR 28643 and the current text of 42 CFR Part 10. Consult a qualified professional about a particular covered entity, manufacturer, or dispute.

Last reviewed: April 19, 2024

The exception path is the agentic workflow layer.