Episode Summary
In this episode of 340B Pulse, Muhammad Atif and Nadia speak with Katy Felice Lees, Director of 340B Policy and Business Strategy at the University of Rochester Medical Center and Principal 340B Compliance Advisor with Virtue 340B. Katy traces her path from pharmacy technician to leading a 14-person compliance team across a multi-hospital system, then turns to what has changed in day-to-day 340B work.
The core argument is that “compliance alone” is no longer a sufficient mental model for operators. Manufacturer-specific requirements, reimbursement shifts such as Medicare Maximum Fair Price (MFP), and volatile policy cycles (including the rebate model debate) have pushed financial and operational risk to the top of enterprise risk assessments, while foundational topics such as duplicate discount prevention and GPO prohibition remain table stakes. Katy describes the current environment as “madness” in the sense of relentless urgency, and offers a practical counterweight: stay grounded in what the organization can control, avoid overreacting to every headline, and build internal discipline around data, relationships, and cross-functional execution.
The conversation covers leadership levers (stewardship, transparency, budget and advocacy alignment), the difference between rules on paper and operational reality (duplicate discount workflows as an example), child-site developments as an operational opportunity that still demands intentionality, why GPO prohibition remains structurally embedded in hospital and ambulatory design, and what rebate-model preparation should emphasize beneath the noise (cash flow, workload, accountability, and data readiness). Katy closes with guidance for the next 6–12 months: breathe, stay informed without panic, rely on data, keep the “village” engaged, and take changes one step at a time.
Show Notes
- How 340B operating load has shifted from “audit-ready compliance” to a broader portfolio of financial and policy-driven risks.
- Why the “everything at once” feeling is real for covered entities, including year-end policy volatility.
- Defining control: core compliance obligations versus strategic monitoring, sequencing work, and last-minute pivots.
- Leadership control: program mastery, defensibility, internal updates, budget cycles, and sustained government-relations relationships.
- Overreaction versus under-preparation: when to act, when to wait for information, and how MFP dynamics changed when the rebate pilot path shifted.
- Compliance versus operational control: duplicate discounts, Medicaid carves, EHR configuration, TPAs, modifiers, and continuous validation.
- Child-site developments interpreted as operational and governance choices, not a free-for-all, including transparency and registration discipline.
- GPO prohibition as infrastructure: split inventories, mixed-use safeguards, and why headlines do not erase long-standing constraints.
- Rebate model preparation: advocacy timing, learning from MFP and manufacturer data policies, upfront payment and rebate timing risk, and clear ownership.
- Internal discipline: intentional cadence, cross-functional forums (pharmacy, informatics, billing, legal), and vendor collaboration without outsourcing judgment.
- Technology and AI: strong internal data access today; potential for first-pass automation on routine oversight without replacing human accountability.
- Staying current: trade press, hospital associations, 340B Health, AHA, peers, and conference networking.