Saturday, May 21, 2022
    HomeHealthThe Biden administration paid hospital Covid-19 funds to drugmakers

    The Biden administration paid hospital Covid-19 funds to drugmakers



    WASHINGTON — The Biden administration quietly took practically $7 billion from a fund meant to assist hospitals and clinics affected by the pandemic and used it to purchase Covid-19 vaccines and therapeutics, in response to an inside doc obtained by STAT.

    The transfer is just like the Trump administration’s choice to divert $10 billion from the same fund to Operation Warp Velocity, which STAT reported solely in March.

    Now, the hospital cash, often known as the Supplier Reduction Fund, has run dry, and has no new cash left to allocate, in response to the company that administers it. Suppliers have solely been in a position to submit requests for bills incurred by way of March 2021 — earlier than each the Delta and Omicron surges battered the well being care system.


    With the brand new $7 billion shift, which has not been beforehand reported, the diversion to drugmakers totals practically $17 billion, or roughly 10% of the general cash Congress allotted for the fund for hospitals and doctor practices. Congress put aside that cash to assist well being care suppliers pay for pandemic-related bills together with staffing, private protecting tools, look after uninsured sufferers, and vaccine distribution.

    The brand new particulars in regards to the Biden administration’s spending choice comes as hospitals throughout the nation are battling a crushing surge of Covid-19 hospitalizations and deaths because of the Omicron variant. And their representatives in Washington are livid.


    “We’d be deeply troubled and annoyed to search out out that billions of {dollars} have been siphoned off from the fund, particularly since no funds have been allotted to the Delta or Omicron surges,” AHA government vice chairman Stacey Hughes stated.

    Although some giant, rich, hospitals have boasted sturdy steadiness sheets lately, the hospital sector is various. Not all services have mammoth wet day funds to climate surge after surge, and staffing prices are skyrocketing.

    A spokesperson for the Division of Well being and Human Providers stated utilizing the cash to pay drugmakers for contracts was an affordable use of the hospital and clinic funds as a result of the vaccines and therapeutics bought got to suppliers for gratis.

    “All Supplier Reduction Fund {dollars} have been used for Supplier Reduction Fund functions,” the spokesperson stated.

    Nevertheless, there is no such thing as a transparency into which contracts the cash was used for, and the place these merchandise had been distributed.

    Authorities watchdog stories provide clues into the timeline of the spending. As of March 1, 2021, $10 billion had been used to pay drugmakers. By Aug. 31, that quantity jumped to $14.8 billion. And per the doc obtained by STAT, the whole is $16.7 billion by way of Dec. 23.

    HHS says explicitly on its website that any grants that suppliers resolve to ship again to the federal authorities, for no matter cause, could be given again out to suppliers. And hospitals such because the Mayo Clinic did certainly return about $9 billion in grant funds, after their monetary efficiency rebounded sooner than anticipated.

    A minimum of a few of that returned cash was as an alternative used for vaccine and therapeutics contracts, an HHS spokesperson stated.

    Past simply hospital funds, the Biden administration can be planning to divert one other $1 billion in cash that lawmakers particularly put aside for Covid-19 testing actions. That funding will as an alternative go to purchase extra vaccines and therapeutics, STAT has discovered.

    Congress put aside about $97 billion to bolster testing and speak to tracing all through the pandemic, and solely about $4 billion of that cash is unallocated, , in response to a abstract of supplies supplied to Sens. Richard Burr (R-N.C.) and Roy Blunt (R-Mo.) that STAT obtained.

    The revelations come as lawmakers are aiming to move a authorities funding package deal by Feb. 18, and debating whether or not extra Covid-19 aid funds must be added to the package deal. The American Hospital Affiliation has asked lawmakers for an extra $25 billion in supplier aid funds, and an unbiased group of 700 hospitals requested for an extra $20 billion. Security-net hospitals are asking the administration to set $20 billion apart for workforce prices.

    The White Home has to this point taken the place that it doesn’t want additional Covid-19 aid funds, and has not but made a request from Congress, although a future ask is feasible.

    “By way of cash, we have now the cash that we have to combat Omicron.  Because the President has at all times stated, we’ll do the whole lot that we have to do to beat this pandemic.  And if we do want extra money at — extra funding, sooner or later, we are going to request that cash,” White Home Coronavirus Response Coordinator Jeff Zients said on Jan. 12.


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