Editor’s note: Richard Hughes is a member of the firm Epstein Becker Green in the Health Care & Life Sciences practice and a former vice president for Moderna.
Just over two years since the coronavirus pandemic began, society presses forward, seeking normalcy. Restrictions have lifted, severe cases and deaths from COVID-19 have plummeted thanks to rapidly developed vaccines and therapeutics.
The United States government has played an important role in assuring supply of these life-saving interventions, while state and local public health has muscled the logistics of allocating and distributing vaccines, getting them the last mile to the front lines.
Today, Congress and the Biden administration are at odds on the need to purchase additional vaccines and therapeutics while the public health workforce is beleaguered as it faces the newly added battle against a monkeypox outbreak. The administration just procured antibody treatments for an additional $275 million while members of Congress are calling for the federal role to wind down.
The Biden administration has announced efforts to address the burnouts, but there is no transition plan to relieve the public health workforce while sustaining longer-term access to vaccines and therapeutics.
Transitioning distribution responsibilities
As the Congressional appetite for continued purchase of COVID-19 vaccines and therapeutics continues to shrink, reliance can be shifted from the federal government to viable systems for continued purchase, coverage and finance of these interventions. This will require a transition plan that balances two important interests — the uninterrupted supply of COVID-19 vaccines and therapeutics and continued access to protections for patients. These interests are politically important for the administration and they can be accomplished while taking definitive action to relieve our nation’s public health workforce.
To date, the vaccine and treatment response has relied almost singularly on public health infrastructure for allocation and distribution. State and local health departments have worked tirelessly since the beginning of the COVID-19 pandemic, operating under a continued emergency response.
In many states, these departments were responsible for augmenting the capacity of strained health systems. They implemented the myriad public health policy interventions to stem the pandemic’s effect, including introducing masking and social distancing requirements, as well as restricting daily gatherings and activities. When the FDA authorized vaccines and treatments for emergency use, state and local public health agencies stepped up and rapidly distributed the products to their communities.
Today, multiple distributors and group purchasing organizations, ordinarily integral supply chain entities, are on the sidelines regarding the distribution of vaccines and therapeutics. These organization are accustomed to supporting the flow of both publicly and privately procured vaccine doses, as well as therapeutics.
This “know-how” was unfortunately missing last summer as immunization rates plateaued. Despite the urging of numerous stakeholders through Healthcare and Public Health listening sessions hosted last year by the HHS, no transition plan has emerged from the administration.
Transitioning to the next Stage 2 would maintain the federal government’s current role as the sole procurer of products, but would engage private sector partners in their distribution, relieving the strain on state and local public health. This would also greatly enable access to COVID-19 vaccines because providers would be able to place orders through ordinary channels without relying solely on Centers for Disease Control ordering systems.
Perhaps most importantly, rebalancing the responsibility for COVID-19 vaccines and therapeutic distribution would free up the resources and capacities of state and local public health agencies to address other public health challenges. During the pandemic, routine immunization rates for diseases other than COVID-19 have plummeted. This poses a very real public health threat, like potential measles outbreaks. Moreover, public health threats such as monkeypox have and will continue to emerge and require agencies to pivot focus and resources.
Transitioning coverage, finance responsibilities
Preparation for an ultimate transition to Stage 3 is also needed as COVID-19 becomes an endemic disease and seasonal vaccination efforts take place alongside influenza vaccination. Under this stage, subject to FDA approval status, and once the administration is assured that supply is sustainable, products would be purchased through ordinary public and private channels. Significant planning and preparation is needed across federal agencies and among private actors to enable Stage 3.
The CDC will ultimately establish contracts with vaccine manufacturers through the Vaccines for Children and the Public Health Service Act Section 317 Immunization programs. Likewise, the Veteran’s Administration and Defense Department will purchase vaccines and contracts that will need to be put in place. These agencies’ processes entail solicitation of bids that require significant lead time.
The CMS will need to provide payers with guidance across multiple markets as to when they must begin covering the acquisition cost of COVID-19 vaccines and therapeutics. Currently, plans are only responsible for the associated administration fees. For CY 2023, the CMS is requiring that Medicare Advantage plans capture the cost of COVID-19 vaccines in capitation rates. These plans will need sufficient notice in order to include the full cost of both product and administration in their bids. Moreover, state Medicaid programs will need to ensure fee for service and managed care programs are prepared to cover these costs.
Joint, multi-agency guidance from the federal government with articulated processes and detailed timelines would aid public and private sector partners in a smooth transition to both Stages 2 and 3.
Addressing remaining gaps
Important policy questions loom in conjunction with Stage 3. Importantly, a transition does not automatically equate to loss of access. Rather, it provides an opportunity for the Administration to “right size” its role in procurement. As I observed at the beginning of the COVID-19 pandemic when lawmakers prematurely fixated on pricing, there are existing mechanisms for vaccine coverage and access and they should not be overlooked.
Yet, while private health insurance, Medicare, the Vaccines for Children programs and expanded Medicaid coverage will cover the entire cost of COVID-19 vaccines with no out of pocket costs, how will those without a source of coverage continue to access vaccines? Congress recently declined to appropriate additional funds for the COVID-19 Coverage Assistance Fund administered by HRSA and there is no vaccine safety net for about 20 million American adults. The president’s CY23 budget proposal takes the important step of outlining the need for such a safety net.
While the out-of-pocket protection for vaccines was enshrined in the Affordable Care Act, patients still typically bear out-of-pocket costs for treatments. This norm has been suspended for COVID-19 treatments as the federal government procured their supply.
This reduced access barrier has been important to the overall containment of COVID-19, including reduction of transmission, severity and mortality. As the pandemic subsides, policymakers and payers will need to determine whether COVID-19 treatments are subject to all of the ordinary aspect of cost containment in our health care system or if out of pocket protections should continue.