Safety-net providers sue to stop Medicaid carveout


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[MM Curator Summary]: Facilities that make lots of money off the 340B scam are now resorting to “equity” as their last defense against the long-planned reform in NY.



Clipped from:


03/27/2023 10:00 AM EDT

Presented by HANYS and GNYHA

Beat Memo

Two safety-net providers are taking the state Health Department to court in a last-ditch effort to prevent a disputed Medicaid carveout from taking effect.

Evergreen Health, along with Heritage Health and Housing, a not-for-profit that operates a federally qualified health center in Harlem, filed a lawsuit in New York Supreme Court on Friday seeking an injunction of the carveout before it takes effect April 1.

They allege the long-planned effort to merge Medicaid pharmacy benefits under a single state program violates federal law and is discriminatory.

The litigation escalates an ongoing battle at the eleventh hour over the proposed change to how millions of New Yorkers will soon access their medication. The plan, a remnant of Gov. Andrew Cuomo’s last fiscal budget proposal, in 2021, could potentially save the state hundreds of millions of dollars, according to Gov. Kathy Hochul’s proposed budget.

But fierce opposition, mainly from safety-net providers who financially depend on a decades-old federal program known as 340B, which would be sidelined under the new rules, stalled the reform for years.

At a budget hearing in late February to discuss the carveout, Housing Works CEO Charles King was one of several protesters arrested on trespassing charges after disrupting the proceedings to oppose the measure.

New York City Mayor
Eric Adams and Ashwin Vasan, the city’s health commissioner, have also come out against the carveout, saying it would disproportionately harm LGBTQ patients and patients living with HIV.

“DOH will wreak immeasurable harm upon New York’s safety-net health care providers and the largely low-income persons dependent upon those providers for their health care and medications,” the complaint says.

Supporters of the program, including the Pharmacists Society of the State of New York, say that community pharmacies need it to survive, and that the change would allow patients greater access to choose where they get their medications.

The New York State Health Department did not immediately respond to a request for comment on Sunday.


— No one spoke up for or against proposed rate changes to ambulance fees in New York City at a public hearing Friday, leading FDNY officials to close the hearing early. The changes, which were first reported by POLITICO, would raise the cost of basic life-support ambulance services to $1,385 from $900. They would also charge patients $20 per mile traveled rather than $15, among a few other hikes.

The new fee schedule would ultimately bring in more than $16 millions in revenue for the city in fiscal year 2024, an FDNY spokesperson told POLITICO in February. It is expected to go into effect in the spring.

In a written statement to the FDNY, David Jones and Stephen Krause, the president and executive vice president of the nonprofit Community Service Society, opposed the new fee schedule, saying it would have the “unintended consequence of compelling New Yorkers to forgo medically necessary ambulance services to avoid the prospect of a large bill.”


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