Schumer: Restore funding to reduce price prescription drug program; CMH could be hurt by cuts

ALBANY — U.S. Sen. Minority Leader Chuck Schumer is calling on federal health and human services agencies to restore funding to a program meant to help hospitals offer prescription drugs to low-income people for a reduced cost, a program that is important to patients of Columbia Memorial Health.

Schumer, D-N.Y., held a press conference outside Albany Medical Center on Monday where he urged the U.S. Department of Health and Human Services and the Centers for Medicare and Medicaid Services to restore funding that reimburses hospitals for providing drugs to low-income patients with reduced cost prescription drugs.

The program is called 340B. It provides reimbursement to eligible hospitals including many inner city and rural hospitals through the Medicaid and Medicare Part B programs, to provide drugs to patients for a reduced price or free of charge. The program started with Congress in 1992, allowing eligible organizations to purchase prescription medications at a 20 percent to 50 percent discount.

The departments issued a rule Jan. 1 that hospitals will now be paid average sales price for drugs minus 22.5 percent for drugs purchased under the 340B program and administered in the outpatient setting. Eligible hospitals previously were paid average sales price plus 6 percent, the standard formula for all other Medicare Part B drugs.

“The 340B hospital program has been a lifeline to hospitals across the Capital Region including Albany Medical Center Hospital and Ellis Medicine,” Schumer said Monday. “This critical program has given hospitals significant financial relief by decreasing the burden of the high cost of prescription medication, and it must be protected at all costs.”

Hospitals eligible for 340B in New York could stand to lose a total of $1.76 billion because of the cuts over the next decade.

Five hospitals in the Capital Region are categorized as 340B hospitals and stand to lose millions of dollars over the next 10 years because of these cuts, according to Schumer’s Office: Columbia Memorial Hospital, which expects to lose $1.6 million; Albany Medical Center Hospital, which expects to lose $11.5 million; Ellis Medicine, in Schenectady, which expects to lose $23 million; St. Mary’s Hospital, in Troy, which expects to lose $7.8 million; and Nathan Littauer Hospital, in Gloversville, which expects to lose $503,000.

“The 340b program is very important to the communities and families that CMH serves,” said Columbia Memorial Health Spokesman William Van Slyke. “The loss of this funding would significantly undermine our ability to provide a comprehensive array of services to our patients.”

If the cuts continue, CMH would have to assess a spectrum of options moving forward, VanSlyke added.

Schumer warned it could lead to cuts in services and staff at eligible hospitals.

“In January of this year, the feds slashed the 340B hospital program, which could lead to hospitals being stripped of their ability to provide critical services, and could even lead to the layoff of hospital staff,” Schumer said. “That’s why today I’m calling on HHS and CMS to reverse these cuts at once, to protect access to essential health care services for communities across upstate New York.”