Drug industry vendor Kalderos is urging leaders in Washington to temporarily shield hospitals from losing their 340B eligibility during the COVID-19 pandemic.
“Kalderos is urging a rapid federal response to protect these hospitals,” the company said in a July 23 article on its website.
It said it agreed with the American Hospital Association (AHA) that the U.S. Health and Human Services Department (HHS) should waive 340B eligibility criteria for hospitals that may have experienced a temporary change in payer mix due to the pandemic.
“Absent a response from HHS, we are encouraged to see leadership from a bipartisan group of over 120 members in Congress, led by Rep. Doris Matsui (D-CA) and Rep. Chris Stewart (R-UT),” Kalderos said. “By sending a letter to congressional leadership and introducing legislation, this group has taken important steps towards ensuring that 340B member hospitals do not lose their eligibility.”
In August 2020, Chicago-based Kalderos announced 340B Pay, a platform to let drug manufacturers deliver 340B ceiling prices as back-end rebates instead of as up-front discounts. 340B Pay has received significant pushback from covered entities, which contend that such a policy is an onerous financial and bureaucratic burden that undermines the intent of 340B.
The AHA last October sent letters to congressional leaders and the U.S. Health Resources and Services Administration (HRSA) asking them to investigate and stop 340B Pay. In the letters, it criticized drug manufacturers for limiting distribution of 340B drugs while hospitals were under severe stress due to COVID-19.
According to an analysis by the trade publication Modern Healthcare, 26% of disproportionate share (DSH) hospitals and nearly 11% of sole community hospitals and rural referral centers are at risk of losing their 340B status due to shifts in patient mix. Together, they represent about 64% of all 340B covered entities.
“Kalderos knows how hard our provider partners work to bring needed care to vulnerable communities, and we understand that the 340B program is crucial in these efforts,” Lisa Krajewski, Kalderos Vice President of Strategy for Covered Entity Solutions, said. “Removing hospital access to the 340B program due to a temporary shift in payer mix caused by the COVID-19 pandemic would be counterproductive, especially as the strain of this public health emergency continues. We support swift action at the federal level to ensure these safety-net healthcare providers maintain their access to the 340B program and can continue to focus on the patients they serve.”
