340B trade associations and covered entities submitted public comments overwhelmingly supporting the Biden administration’s proposal to rescind a Trump-era rule requiring community health centers to pass along savings on insulin and injectable epinephrine to low-income patients.
Drug manufacturer Eli Lilly, one of the nation’s three insulin manufacturers, opposed rescinding the regulation and its underlying presidential executive order.
“Lilly believes that patients need to be returned to center of the 340B program,” the company said. The 340B insulin/epinephrine rule and former President Trump’s July 24, 2020, executive order that provided the basis for it “ensure that ‘safety net providers’ live up to their obligations to provide care and access to medicines for low-income people living with diabetes.”
“Rescinding these regulations places the burden of funding operations for covered entity grantees onto the same financially vulnerable patients that these providers are intended to support,” Lilly said. The executive order was touted by President Trump and former U.S. Health and Human Services Secretary Alex Azar at a July 24, 2020, White House event prior to the November elections. Critics of the policy have pointed out that Azar served as the president of the U.S. division of Lilly prior to joining the administration.
340B covered entity grantees should not be encouraged to fund ongoing operations with revenues generated through low-income individuals living with diabetes, Lilly argued. “The decision to rely on low-income patients with a chronic condition and no or inadequate insurance as a funding mechanism for covered entity’s operations underscores the perverse incentives created by the 340B program as interpreted by the agency.”
“We believe complying with the regulations implementing the EO is not overly burdensome, especially when balanced against the public good of providing broad access to low-income patients with diabetes,” the company said.
The rule was due to take effect Jan. 22, but the incoming Biden administration froze it. Last month, it proposed withdrawing the rule and set a 30-day public comment period. Last Friday was the deadline for comments. The U.S. Health Resources and Services Administration (HRSA) received 343 comments.
The National Association of Community Health Centers (NACHC) “strongly supported” rolling back the final rule.
Joe Dunn, NACHC Senior Vice President of Public Policy and Research, noted in his six-page letter that the proposed final rule would have no impact on the price of insulin, since it is set by the manufacturers—which he said have “roughly tripled” prices over the last decade.
The Community Clinic Association of Los Angeles County also noted in its comments that since 90% of diabetes patients in the U.S. do not receive their care at a community clinic, “this final rule would have zero impact on how the majority of diabetic patients pay for insulin.”
The Los Angeles-based Venice Family Clinic—one of the most prominent community health centers in Southern California—also overwhelmingly supported rescission of the proposed final rule.
“This regulation would actually reduce access to care for underserved populations, rather
than expand it. This is because implementing the final rule would impose significant administrative burdens and costs on health centers, reducing the resources they have available to support critical services for all their patients—including those who use insulin and injectable epinephrine,” wrote Venice Family Clinic CEO Elizabeth Forer.
Grace Health, which operates community clinics in Battle Creek, Mich., echoed the Venice Family Clinic.
“Implementing the final rule would impose significant administrative burdens and costs
on health centers, reducing the resources they have available to support critical services
for all their patients,” wrote Carrie Nelson, Grace Health’s pharmacy director, who also noted that the rule’s definition of low-income patients as earning 350% of the federal poverty level and below “is inconsistent with every known federal program, and…significantly increases the administrative burden on health center staff.”
Nelson, Forer, and Dunn also urged the Biden administration to revoke Trump’s executive order that called for the 340B insulin/epinephrine rule.
“If the Biden administration revokes the underlining executive order, health centers can shift their focus from regulatory 340B program threats to defending the external attacks on the 340B program and covered entities, like contract pharmacies,” Dunn wrote.
Hospital group 340B Health submitted comments from President and CEO Maureen Testoni and Chris Crosswhite, senior vice president of legal and policy. “We share HRSA’s concerns about policies that reduce 340B savings and jeopardize patient access to critical health care services and agree that HRSA should rescind the final rule implementing the Executive Order,” they noted.
“Ironically, while the final rule implementing the executive order targeted access to affordable insulin, the three drug companies that provide practically all of the insulin products in the United States—Eli Lilly, Sanofi, and Novo Nordisk—are denying 340B discounts under contract pharmacy arrangements,” they noted.
“These denials of 340B discounts have been particularly harmful for covered entities’ patients who require insulin,” they wrote. “UnityPoint Health Methodist in Illinois reports that as a result of the manufacturers’ restrictions, patients who used to receive low-cost insulin from the hospital’s contract pharmacy have been forced to switch to less efficacious insulins and their health and financial situations have suffered.”
Pharmaceutical Research and Manufacturers of America (PhRMA) told HRSA while it does not oppose rescission of the rule, it “remains deeply concerned that the 340B program has grown exponentially over the past decade, with little evidence of a commensurate benefit to vulnerable patients.”
