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Safety Net Providers Statement on State Budget

Apr 7, 2021

Final Budget Agreement Includes Two Year Delay of Medicaid Carve Out Provision

Albany, NY – The New York chapter of Ryan White Clinics for 340B Access (RWC-340B) today issued the following statement on the state budget. The final budget agreement between the Legislature and the Governor includes a two-year delay in implementation of a harmful Medicaid “carve out” of a federal prescription drug benefit. The agreement comes after a months-long campaign, led by advocates and Medicaid patients, to reverse the provision. 

“Small community health clinics rely on this funding to provide critical services to our patients, many of whom are living with HIV/AIDS. This much-needed delay will allow us to continue to fight back against COVID-19 – and ensure that our patients have the life-saving medication they depend on. We are grateful to the leadership of the Senate and Assembly for all the work they’ve done on behalf of our communities,” said Michael Lee, Secretary of RWC-340B and COO of Evergreen Health Services. 

“We are incredibly thankful to our champions in the Senate and Assembly who never stopped fighting for New York’s most vulnerable patients. This agreement gives us time to work on a long-term plan that will achieve savings without balancing the budget on the backs of New Yorkers in need,” said Mark Malahosky Treasurer of RWC-340B and Vice President of Pharmacy Services at Trillium Health. 

The “carve out” provision was a recommendation from the Governor’s Medicaid Redesign Team II (MRT II) that was hastily approved as part of last year’s state budget. This provision would require the New York Medicaid program to carve out the pharmacy benefit from the state’s Medicaid managed care program and shift payment of drugs covered under that benefit to fee-for-service reimbursement. If implemented, the carve out provisions would harm Ryan White Clinics, Federally Qualified Health Centers, Safety Net Hospitals, and other safety net providers in the 340B drug discount program and adversely impact the financial stability of health care clinics across New York State.  

Clinics rely on this funding to provide COVID screening and vaccinations, operate food pantries, provide transportation assistance, STI screenings, and run harm reduction programs – services that are often grossly underfunded by the state. If the carve out is not reversed, many patients across the state will simply have nowhere to turn.  

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About the 340B Drug Pricing Program 

The federal 340B Drug Discount Program is a lifeline that allows safety net providers, including HIV/AIDS clinics receiving support under the Ryan White CARE Act, to obtain prescription drugs at below-retail prices. The program was established with bipartisan support as part of the Veterans Health Care Act of 1992. With 340B savings, Ryan White Clinics are able to stretch their grant funds, offer a wider range of services, and improve the quality of care for people living with HIV/AIDS. 340B savings enable providers in the state to supply prescription drugs to needy patients at reduced or no cost; assist patients with their insurance premiums to encourage medication adherence and continuous treatment; and provide medical services at little or no cost to patients.  

About Ryan White Clinics for 340B Access 
Ryan White Clinics for 340B Access (RWC-340B) is a national organization of HIV/AIDS medical providers receiving support under the Ryan White CARE Act. The CARE Act provides funding for services primarily to poor and/or uninsured people with HIV/AIDS. Ryan White providers are eligible to participate in the federal 340B Drug Discount Program, which enables them to expand and support care. In order to preserve access to this critically important program, members of RWC-340B have pledged to work together to advocate for the interests of fellow 340B Ryan White providers. The New York State Chapter of Ryan White Clinics for 340B Access was established to advocate for the reversal of carve out provisions included in the Medicaid Redesign Team II budget proposal.