Split Billing

Split-billing software is a key technology tool in 340B program management. It operates on a neutral inventory model: the covered entity maintains a single physical inventory of drugs, and the software uses data feeds—including patient eligibility, prescriber information, Medicaid status, clinic location, and NDC—to virtually separate 340B from non-340B transactions after they occur.

The software then determines from which purchasing account (340B, GPO, or WAC) each transaction should be replenished. This creates a virtual separation of 340B and non-340B inventory without requiring physical separation of drug stocks.

Split-billing software configuration is a critical compliance activity. The eligibility logic programmed into the software determines which prescriptions are identified as 340B transactions. Misconfiguration—such as incorrect eligibility criteria, wrong clinic designations, or outdated patient eligibility data—can result in diversion or missed 340B captures. Regular configuration reviews and data audits are essential.

TPAs typically provide and manage split-billing software as part of their contract pharmacy management services, but covered entities must understand how their software is configured and maintain independent oversight.