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MHA Today | June 4, 2021



MHA Today

MHA Today is provided as a service to members of the Missouri Hospital Association.

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I often watch for and talk about signals. Humans have evolved to detect everything from the obvious to the subtle — from the sounds of stalking prey so we weren’t eaten by lions on the savannah to the modern equivalent in the minute facial expressions of our colleagues that signal approval or disapproval around the conference room table. Signals help us respond quickly and avoid danger.

There are a lot of signals being sent related to the federal 340B prescription drug discount program. As a Condition of Participation in the Medicaid program, the 340B law requires pharmaceutical manufacturers to sell outpatient drugs at discounted prices to qualifying providers, including community health centers and various types of hospitals. Not every hospital participates — 66 of Missouri’s 140 hospitals are 340B participants, and the hospitals are spread throughout the state.

Six of the big players in the 340B program have refused to continue 340B discounts for qualifying health care providers, including contract pharmacies. Both the Trump and Biden administration disagree with the drug manufacturers’ reading of the use of contract pharmacies and have indicated that the discounts should apply under the 340B law. However, there’s a lot of money at stake. The manufacturers are arguing that the federal government doesn’t have authority to enforce its position, and the issue likely will be resolved through litigation.

Attacks by drugmakers on the program are not particularly new. This most recent action follows previous claims of fraud and mismanagement, and demands for excessive and unrealistic reporting by 340B providers to discourage participation and cast doubts on the program.

The big drugmakers aren’t the only threat. The MO HealthNet Division is moving toward reducing the amounts it pays for 340B drugs to “actual acquisition cost” on Thursday, July 1. At the same time, it is moving to enforce payment limits on physician-administered drugs that are administered by hospitals in outpatient settings. Despite our advocacy efforts spearheaded by a group of nearly 30 hospital pharmacists, MHD is pursuing emergency rulemaking to implement the change. It potentially could cost hospitals $20 million annually.

There’s another threat — reduced utilization during COVID-19. Low-income patients used hospital services less during the pandemic and could jeopardize hospitals’ ability to participate in the 340B program without specific action by Congress to adjust for the change.

So, what is the signal?

Pharmacy is a growing cost in health care. However, it is increasingly clear that pharmaceutical manufacturers, and now the state’s Medicaid program, are less and less willing to share the burden of these costs.

The safety net can’t be built exclusively on cost-shifting. As with debates on Medicaid expansion and the Federal Reimbursement Allowance, hospitals are willing to be a partner in improving access to care. We cannot bear this burden alone.

The signals are clear: Big pharma’s strategy is profit growth on low-income patients and MHD’s is mere expenditure reduction. Neither strategy produces value — they simply shift costs to other payers to the detriment of the 340B pharmacy program and to our state’s health care safety net.

Let me know what you think.

Herb Kuhn, MHA President & CEO



Herb B. Kuhn
MHA President and CEO

In This Issue

MHA Distributes Analysis Of The Proposed FFY 2022 LTCH PPS
UnitedHealthcare Will Implement Emergency Visit Assessment Attestation In Most States
MLN Connects Provider eNews Available
SAMHSA Releases Supplemental Research Bulletin On Preliminary Effects Of COVID-19 Pandemic
CMS Reminds Hospitals Of HCAHPS Submission Deadline
CORH Opens Application Portal For Vulnerable Rural Hospital Assistance Program

COVID-19 Updates
Quality & Population Health
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