Health Care

Opinion: Medicaid prescription changes threaten patients and safety net providers

The federal 340B drug pricing program that serves low-income and underserved patients is about to be stripped of funding which may reduce STD and COVID-19 treatment services in New York.

New York state plans to move Medicaid pharmacy benefits from managed care to a  fee-for-service model, which may impact STD, COVID-19 and other critical treatments available from safety net providers, writes New York City Health Commissioner Ashwin Vasan.

New York state plans to move Medicaid pharmacy benefits from managed care to a fee-for-service model, which may impact STD, COVID-19 and other critical treatments available from safety net providers, writes New York City Health Commissioner Ashwin Vasan. Ed Reed/Mayoral Photography Office

New York state is about to disrupt how Medicaid patients receive the prescription drugs they need, which will compromise safety net providers’ ability to provide critical care to underserved New Yorkers. Since 1992, the federal 340B drug pricing program has given low-income patients and their communities necessary resources and services through discounted drug prices. The 340B program allows qualifying hospitals, federally qualified health centers and community health centers to purchase outpatient prescription drugs at a discount and then invest those savings into reduced cost or free medications for patients or into services not covered by Medicaid, such as care coordination, housing placement and food and nutrition programs, to name a few.

Safety net providers, hospitals and other 340B entities throughout the state have used this program to offer critical medical care and help connect underserved, low-income patients to an array of supportive services that allow them to live longer, healthier lives.

This is a matter of equity: A survey of 340B entities across the state found that 66% of their patients are Black or Latino; 11% are transgender, gender-nonconforming or nonbinary; 41% are over 50 years of age; over 50% have a substance use disorder; 62% are experiencing homelessness or need housing support; and 18% are uninsured or underinsured.  

On April 1, 2023, the state plans to move over 5 million Medicaid members’ pharmacy benefit out of managed care and into fee-for-service, which will allow the state government to absorb the savings that 340B entities accrue through the program, stripping this funding from the health care system. Save New York’s Safety Net, a statewide coalition of clinics, community-based organizations, and HIV health plans, estimates that this “carve-out” of the pharmacy benefit will result in an estimated $240 million a year in lost revenue for 340B entities, forcing the reduction or elimination of critical medical and supportive services for vulnerable New Yorkers. NYC Health + Hospitals, the safety net system for New York City, forecasts a loss of at least $123 million a year.

This means some 340B entities may be forced to reduce clinic operations or fully shut down sites, thus reducing HIV, sexually transmitted infection, and hepatitis C services, community education and outreach, and COVID-19 testing and treatment. Removing the pharmacy benefit from managed care will also change how patients receive pharmacy care. Managed care plans currently provide access to specialty pharmacists with expertise in HIV, mental health and gender-affirming care, which will be lost in a fee-for-service model. The 340B program also allows community health centers and hospitals to offer pharmacy services onsite. The carve-out could throw a wrench into plans to develop or expand accessible, community-based pharmacy services. 

Other jurisdictions have stumbled after introducing a similar pharmacy benefit carve-out. In January 2022, California transitioned its Medicaid drug program from managed care to fee-for-service. Within a month, Medicaid enrollees reported that they had been forced to go without their medications for weeks and were regularly experiencing hourslong waits on call center lines. California providers continue to report lost patient data and improper claim denials following the carve-out, and these issues persist today. 

In 2021, Save New York’s Safety Net along with community advocates, providers, health plans and hospitals successfully fought to delay this move for two years, but the state is set to initiate the carve-out on April 1, 2023. Time is running out to ensure our most vulnerable communities have the medical and supportive services they need to stay healthy. 

New Yorkers have witnessed multiple public health crises in the past few years that have taken – and continue to take – a major toll on an already burdened health system still recovering from pauses in service during the first wave of the COVID-19 pandemic. Each crisis underscores the importance of our safety net. The carve-out will rip a hole in this net, and many will fall through the cracks, exacerbating inequities and hindering progress in preventing disease. State legislators should repeal this policy and allow 340B entities to continue receiving savings. Our most vulnerable New Yorkers must continue to receive the level of care they deserve.

X
This website uses cookies to enhance user experience and to analyze performance and traffic on our website. We also share information about your use of our site with our social media, advertising and analytics partners. Learn More / Do Not Sell My Personal Information
Accept Cookies
X
Cookie Preferences Cookie List

Do Not Sell My Personal Information

When you visit our website, we store cookies on your browser to collect information. The information collected might relate to you, your preferences or your device, and is mostly used to make the site work as you expect it to and to provide a more personalized web experience. However, you can choose not to allow certain types of cookies, which may impact your experience of the site and the services we are able to offer. Click on the different category headings to find out more and change our default settings according to your preference. You cannot opt-out of our First Party Strictly Necessary Cookies as they are deployed in order to ensure the proper functioning of our website (such as prompting the cookie banner and remembering your settings, to log into your account, to redirect you when you log out, etc.). For more information about the First and Third Party Cookies used please follow this link.

Allow All Cookies

Manage Consent Preferences

Strictly Necessary Cookies - Always Active

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data, Targeting & Social Media Cookies

Under the California Consumer Privacy Act, you have the right to opt-out of the sale of your personal information to third parties. These cookies collect information for analytics and to personalize your experience with targeted ads. You may exercise your right to opt out of the sale of personal information by using this toggle switch. If you opt out we will not be able to offer you personalised ads and will not hand over your personal information to any third parties. Additionally, you may contact our legal department for further clarification about your rights as a California consumer by using this Exercise My Rights link

If you have enabled privacy controls on your browser (such as a plugin), we have to take that as a valid request to opt-out. Therefore we would not be able to track your activity through the web. This may affect our ability to personalize ads according to your preferences.

Targeting cookies may be set through our site by our advertising partners. They may be used by those companies to build a profile of your interests and show you relevant adverts on other sites. They do not store directly personal information, but are based on uniquely identifying your browser and internet device. If you do not allow these cookies, you will experience less targeted advertising.

Social media cookies are set by a range of social media services that we have added to the site to enable you to share our content with your friends and networks. They are capable of tracking your browser across other sites and building up a profile of your interests. This may impact the content and messages you see on other websites you visit. If you do not allow these cookies you may not be able to use or see these sharing tools.

If you want to opt out of all of our lead reports and lists, please submit a privacy request at our Do Not Sell page.

Save Settings
Cookie Preferences Cookie List

Cookie List

A cookie is a small piece of data (text file) that a website – when visited by a user – asks your browser to store on your device in order to remember information about you, such as your language preference or login information. Those cookies are set by us and called first-party cookies. We also use third-party cookies – which are cookies from a domain different than the domain of the website you are visiting – for our advertising and marketing efforts. More specifically, we use cookies and other tracking technologies for the following purposes:

Strictly Necessary Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Functional Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Performance Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Social Media Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Targeting Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.