SMHANYS aii sn ways Therefor Heathcare | Seeceion CHS Hamma, AManes FReccses.. Pandion 4 ROQuaS September 30, 2020 ‘The Honorable Andrew M. Cuomo Governor of New York Stato "New York State Capitol Building ‘Nbany, NY 12224 Howard A. Zucker, MD, 1D Commissioner ‘New York State Department of Health Corning Tower Empire State Plaza ‘Nbany, NY 12237 ‘Dear Governor Cuomo and Commissioner Zucker: ‘We would lke to begin by offering our sincerest thanks on behalf of our members for your leadership during this very fou ime. We have all ben inspired by your determination, responsiveness and partnership to ensure that healthcare providers have the necessary tools to combat COVID-19. ‘We write today ona different, but excoedingly important matter. New York's vulnerable and lowincome ‘populations wil suffer unintended, negative effets trom a Mediald pharmacy benefit provision in tis ‘year’s enacted budget. We urge you to reverse this provision, forthe reasons outlined below. ‘Te state fiscal year 2020-2021 bucget wil shit the Medical retall pharmacy benefit from the managed care package tothe fee-for-service program in 2021, drastically reducing the cost savings ‘many safely net hosptals realize from the federal 3408 Drug Pricing Program. Hospitals reinvest these ‘Savings to expand healtncare services for the vulnerable patents and communities they serve. “The purpose ofthe 2408 Drug Pricing Program leo anabla particinating healthcare organizations to stretch limited resources so they can provide more comprehensive services to thei communities. To ‘achieve this goal, the program requires participating pharmaceutical manufacturers to sel certain ‘outoatent drugs at significant reduced prices to healthcare providers who serve vulnerable populations and participate inthe 3408 Program. ‘Consistent withthe program's intent, New York's 3408 hospitals use these savings to support a variety of natives, such as providing free or substantial discounted prescriptions to low-income patients and ‘uncing programs and services that they might otherwise not be able to operate. With these funds, ‘3408 hospitals are advancing the goals of New York's Ending the Epidemic plan and addressing Underying social determinants of health to improve health outcomes. The attached document provides ‘mare information on how 3408 hospitals reinvest program savings in their communities.‘Governor Cuomo and Commissioner Zucker Powe 2 September 30, 2020 8y transitioning the Medicaid pharmacy benef from Medicaid managed care to FFS as required by the ‘enacted budget, New York's 3408 hospitals will be reimbursed for 3408 drugs at cost. That mear Darcipating hospitals wil na longer draw down savings when purchasing 3408 drugs, effectively Undermining the very purpose ofthe federal 3408 Program. At the same time, hosptas are grappling ‘atthe federal level with CMS" nearly 30% reduction tothe 3408 program. This cut comes on top of ‘grgious efforts by drug companies to undermine hospital access tothe 3408 progam by limiting ‘access to 3408 drugs and instaling onerous reporting requirements. ‘Thisise significant loss coming atthe worst possibie time for our safety net hospitals and their ‘communities. About 100 hospitals serving low-income and indigent populations dross the state wil lose more than $8 milion next yar rom sis policy enange. ns 1s of top oF te staggering $20 lion {0 $25 pillonin losses and new expenses New York's hospitals are expected to suffer during this time ‘due tothe COVID-49 response, If allowed to stand, ths massive policy and operational shit wil eopardize the solvency of ertcal healtheare senices and programs for wlnerable and low-income populations curenty benefiting from the investments made by hospitals using 3408 savings. (On behalf ofthe safety net hospitals partcpating in the 3408 program and the communities and patients they serve, we strongly urge you to reverse the acons taken in the current state budget and keep the Medicaid retail pharmacy benefit where it can do the most good: n the Medicaid managed care package. ‘We appreciate and support your angoing recognition of the extraordinary challenges current facing hospitals and the heatheare provider community. Given the dire state fiscal challenges and indeterminate federal assistance, we ask you to reconsider this Medicaid pharmacy policy change and associated nding reduction inthe context of what i the greatest public heatn emergency In modem histor. ‘Tank you fo your leadership and fr helping to ensure that New York's hospitals can continue providing comprehensive health services tothe patients and communities they serv. Sincerely, Wns (5. Grose LHL KR. re sen rita ceo rane oe Sin pa an CAST Fouhlhia. ——— Esfthed pete Fesicnetuceo ‘an wk mi Tent axes Fichard Beoker, MD Frank Walsh Donna FrescatoreThe 2020-21 New York State budget eliminates 340B drug discounts hospitals access for services provided to Medicaid enrollees. Program Basics and Key Dates ‘The federal 3408 Org Pricing Program enables more than 100 New York safety net hess serving lomincome and vnerable New Yorers te purchase outetiont crus rom pharmaceutical manufacturers at ‘8 alscounted at (~ 20% to 50% dscount “These hospitals rly onthe savings fm the 3408 drug discount rogram to provide greater access to ‘harmacettcas and comprehensive services inthe commune, which they otherwise would not beable to-do because of ehnie underpayment ors public payers ke Neca. State Fiscal Year 2020- 2021 Budget Actions October 1, 2020 Department of Health stakeholder workgroup to make recommendations ‘on how to achieve Medicaid program ‘Savings for discounted drugs acquired by providers under the 3408 program. 340B Benefits for Patients Nw Yore’s S408-tigible hospitals leverage savings accessed under 3408 to operate programs and services that they might otherwise not be abe to operat, Such asthe following services reported by HANYS' member: ‘fe or substantial acount presen to ‘uninseé awincome patients, ‘+ modication tharapy management pomans o improve patent care and reduce vr healthare ost and hospital readmssions; mile units to ring care to rua andar medical underserved communis without lal primar eae option :phamacies; * fe anolgy services fr lonincame patients ‘+ multiisepiay clin oferig substance abuse and mena health seis and ‘transportation support fa paints who ned to ‘se emergency om seioes, No sooner than April 1, 2021 DOH to mave the Medios pharmacy benefit om the managed care benefit package tothe fee-forsenice program (expected to reduce Medicaid spending by $87.2 millon). This change will have Implications on the cot savings Posptals and other provider leverage trom the ‘3408 Drug Discount Program to reinvest in their communities. April 1, 2023 Requies reimbursement of 3408 drugs ‘based ona method that considers the ‘sctual acquisition costs and professional ‘isponsing ees. ‘These are just afew examples ofthe many Say NS spl rest enn ened {rom tho 3408 program to improve ace tere vert ore, Many tthe Investments come from hospitals that are oad La) HANYS 200 Hae Auton Ra Se Nag. ‘Always There for eathcareNortheastern New York Hospitals that ‘ie tle ia tical are participate lo inthe 3408 ie Calentia Marni Hospi program ‘ie ‘iit - ito i tnmerbo = New York city Bei et ia etal a ___ ae ae pevtter i iis ig edie a there istic Gi ase it angling on eae cn - tii eee a a iim sc ~ tae ini iis init mi “Gane ale ie te i ini i sia oie ie ic te ont ie : iid iif cag =n La at ii ine it om - act awa nga Mov Si Meise ‘ahi Cerin esa va - ‘Schule Hostal, : ‘Ne Yer Goan spit ‘aston umelton ‘Sis Sb tol ee thio Sink LARTER - lin ‘eon ein Bain as gta ete itn a ine co er -retin al ‘Compstat Western New York iv etn oes tii testern New York __ earner Pelee a Se eae “eat soars St ae Ce = et it ih gs is es wag _Mih ta ts as ea Ses a na St rl . ‘NYG Heath Hospitals ings County ‘Upstate Univers Hostal ‘ee ities” Nea ‘ea Goll Northern Metropolitan Area a pa iti ha Conn Wiha hepsi” ates mma tt See a i a is ves sii ee Oe ite ee ition sheets hana atte cl ote iE Gide : ve Rovaene a Soa onal Long Island Seheend teem ‘atdance epita= xo Mays ue ones, : Ser S's Enieapl Heel ar Rocko Manin ack Hepat - a Sl es pi-MBe” “yee os i ‘nt oe “epi — -—_ wrt espe trot _- Ses Rei Hapa - Sey eet ‘el ce Gn West il Ce