340B Protections and Clarifications Sought in Next COVID-19 Relief Bill

April 14, 2020 Tom Mirga, Editor at Large Views

340B Protections and Clarifications Sought in Next COVID-19 Relief Bill

Congress’ next COVID-19 relief bill should shield hospitals from losing 340B eligibility during the pandemic and clarify that providers can get 340B discounts on drugs prescribed via telehealth, America’s Essential Hospitals told lawmakers in a letter yesterday.

“The 340B program is key to the patchwork of federal supports essential hospitals rely on to fulfill their safety-net mission,” association President and CEO Bruce Siegel wrote. “Our members will lean on 340B discounts to maximize their limited resources during this pandemic.”

Siegel said Congress can preserve hospitals’ access to 340B drugs during the pandemic by letting hospitals remain 340B-eligible if payer-mix changes deflate their Medicare disproportionate share (DSH) adjustment percentages. DSH, children’s, and free-standing cancer hospitals must have a Medicare DSH percentage greater than 11.75 percent for their most recently filed Medicare cost report to stay eligible for 340B. Rural referral centers and sole community hospitals must have a percentage equal to or greater than 8 percent. “For some essential hospitals, the disruptions caused by COVID-19 could result in temporary swings in their DSH adjustment percentage, jeopardizing their eligibility for the 340B program,” Seigel said. “We urge Congress to ensure, for the duration of the COVID-19 emergency, that covered entities can maintain 340B eligibility if their payer mix changes.”

America’s Essential Hospitals also urged Congress to guarantee health care providers’ access to 340B-discounted drugs for patients treated through telehealth. “Providers are increasingly turning to telehealth to expand their reach to patients facing barriers to access, including lack of transportation,” Siegel wrote. “Congress can clarify that 340B discounts are available to covered entities on covered outpatient drugs without regard to the patient’s physical location—that is, whether the provider treats the patient in-person or through telehealth.”

The Health Resources and Services Administration (HRSA) recently posted a 340B program COVID-19 FAQ on its Office of Pharmacy Affairs (OPA) website stating that telemedicine is “merely a mode” of health care delivery and that, for 340B purposes, providers should outline its use in their policies and procedures and keep auditable records for each eligible patient dispensed a 340B drug.

Jostling Continues Over Federal Help for Providers During Pandemic

The Centers for Medicare & Medicaid Services (CMS) last Friday began delivering the first $30 billion of the $100 billion in COVID-19 relief to health care providers under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Congressional Medicaid advisers, members of Congress from New Jersey, New York, and Pennsylvania, and provider groups America’s Essential Hospitals, Greater New York Hospital Association, and Healthcare Association of New York State criticized CMS’s decision to distribute the money based on providers’ share of 2019 Medicare fee-for-service (FFS) reimbursements. They said doing so disadvantages providers located in COVID-19 hot spots and those serving high percentages of patients covered by Medicaid or Medicare Advantage.

The Health and Human Services Department (HHS) appeared to acknowledge those points in an April 10 news release. HHS said it is working with the Trump administration “on additional targeted distributions to providers that will focus on providers in areas particularly impacted by the COVID-19 outbreak, rural providers, and providers of services with lower shares of Medicare FFS reimbursement or who predominantly serve the Medicaid population.”

HHS also noted some of the remaining $70 billion “will also be used to reimburse providers for COVID-19 care for uninsured Americans.” It has been estimated that it could take up to $42 billion of the remaining $70 billion to reimburse hospitals for treating uninsured COVID-19 patients. That would leave less than $30 billion for hospitals and non-hospital providers to share to cover expenses and lost revenue due to the pandemic.

Neither CMS, HHS, nor the administration have said when providers can expect to see the other $70 billion in CARES Act COVID-19 emergency aid disbursed.

America’s Essential Hospitals has asked congressional leaders “to provide additional dollars to the emergency fund” and to prioritize payments to hospitals serving a disproportionate share of Medicaid and low-income patients and vulnerable communities.

A bipartisan group of 124 members of Congress, meanwhile, on April 10 sent a letter to House Speaker Nancy Pelosi (D-Calif.) and Minority Leader Kevin McCarthy (R-Calif.) requesting the inclusion of $7.6 billion in emergency funding for community health centers in any next COVID-19 relief bill. Health centers received $1.3 billion under the CARES Act. The National Association of Community Health Centers (NACHC) on April 3 asked HHS to provide centers with $3.1 billion immediately from the $100 billion Cares Act fund. On April 8, NACHC asked Congress to make health center look-alikes eligible for federal COVID-19 health center emergency assistance. It also asked lawmakers to let about 100 center networks nationwide with more than 500 employees qualify for the CARES Act’s Paycheck Protection Program (PPP) for small businesses.

The American Hospital Association also on April 8 asked the Small Business Administration to ensure that small- and mid-size public and nonprofit hospitals can get PPP loans. A bipartisan group of 87 members of Congress on April 9 sent a letter to the SBA and the Treasury Department asking that rural hospitals and health clinics be granted eligibility for the program.

The way forward on all of the above is unclear. Congressional Democrats and Republicans are at an impasse on the next COVID-19 economic stimulus bill. House Speaker Nancy Pelosi (D-Calif.) and Senate Minority Leader Chuck Schumer (D-N.Y.) are calling for another $100 billion for hospitals and health centers, including production and distribution of personal protective equipment and coronavirus test kits. Last week, Senate Republicans rejected a move by Democrats to add the $100 billion in additional funds for health care providers plus about $400 billion in other COVID-19 emergency assistance to a Republican bill to add $251 billion to the Paycheck Protection Program.

In other related developments:

Pennsylvania Gov. Tom Wolf (D) on April 10 announced a new $450 million Hospital Emergency Loan Program (HELP) to “provide short-term financial relief to Pennsylvania’s hospitals as they prepare for the growing surge of individuals infected with COVID-19 and the economic fallout of the nationwide pandemic.”
Greater New York Hospital Association has created a compilation of federal financial assistance opportunities for hospitals affected by COVID-19. It says it will update the document regularly as new resources become available.

House E&C Oversight Chair Wants FDA to Address Hydroxychloroquine and Chloroquine Hoarding

The chairwoman of a powerful U.S. House oversight subcommittee has asked the Food and Drug Administration to address hoarding of two drugs touted by some as COVID-19 cures.

“While I support continued research to study hydroxychloroquine, chloroquine, and any other drug as a potential treatment to COVID-19, it is imperative that patients with FDA-approved indications for use are able to access their medications,” Rep. Diana DeGette (D-Colo.) wrote in an April 8 letter to the FDA. “Their lives depend on it.” In a news release, DeGette, the chairwoman of the House Energy & Commerce Oversight and Investigations Subcommittee, noted that tens of thousands of patients take the drugs for lupus, rheumatoid arthritis, and malaria. “But as President Trump continues to flaunt these medications as a miracle cure to the novel coronavirus—despite insufficient clinical trials—patients who need these drugs for FDA-approved uses are facing shortages.”

DeGette wants the FDA to warn providers against unnecessarily prescribing the two drugs and ensure current supplies of hydroxychloroquine and chloroquine are reserved for patients taking them for FDA-approved uses. She also wants to know FDA’s plan to address the current hydroxychloroquine shortage, and whether supplies of these drugs from the nation’s Strategic National Stockpile can be used to treat patients with FDA-approved uses in addition to COVID-19 patients.

Not a Subscriber? Sign Up Now!

From 340B Report Publisher and CEO Ted Slafsky

Valuable Resources to Help Track and Prepare for the Pandemic

There has been a proliferation of incredibly valuable COVID-19 resources and tools as this deadly pandemic continues to spread. The most recent that I have come across came to my attention by Rob Miller, a former 340B Health colleague, who is an executive at the data analytics company Gravitate Solutions.

The Gravitate Nucleus COVID-I9 aggregates data from a variety of sources such as the New York Times, covidtracking.com (a resource overseen by a health care editor at The Atlantic), and breakthrough.healthcare (which is tracking healthcare and medical society conferences that have been cancelled). The dashboard includes infection rates, testing, hospitalizations, and fatality rates. You can segment and explore the data to determine your region’s overall preparedness to combat the virus. The site also includes density maps for visual exploration of a local impact, which can also be reviewed over time.

The second site, which has received a lot of attention from both state and national policymakers, is provided by the Institute for Health Metrics and Evaluation at the University of Washington. For each state you can view the government mandated social distancing restrictions, fatalities, and projected deaths. They also provide visualizations of critical resources needed such as hospital beds, ICU beds, and ventilators—and the projected shortage of each. The site also has similar information for other countries, but it appears to be limited based on each country’s collection and reporting of the data.

Like many of you, I have been following the Johns Hopkins COVID-19 global map for a quick view on the extent of the crisis. If you need more information, specifically as it relates to your locality, how well your region is prepared to combat the crisis, or the estimated shortage of critical resources, you might find these resources valuable.

Feel free to share additional resources with me at ted.slafsky@340Breport.com and keep up the heroic work in combatting COVID-19!