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White House warns free Covid treatments are at risk as subsidies run out

The Biden administration is debating how to wind down the federal subsidies that guarantee free treatments for coronavirus patients, as it prepares for a scenario where Congress fails to authorize new funding for the pandemic response.

The move would bring a halt to government coverage for certain Covid-19 therapeutics, shifting them onto the private market and potentially forcing some Americans to pay out of pocket for pricey treatments like monoclonal antibody drugs that can cost as much as $2,000 per dose.

White House and administration health officials led by Covid coordinator Jeff Zients have ramped up efforts in recent days to map out the logistics of such a transition — weighing which treatments to stop funding first, and what the consequences will be for vulnerable and uninsured patients, four people with knowledge of the deliberations told POLITICO.

“They’re not ready yet,” one of those people said of the administration. “This would force them to have to do it abruptly.”

The internal discussions are still in preliminary stages, and no decision is imminent. But Congress’ ongoing stalemate over authorizing more Covid funding has turned what was once a longer-term project into a more urgent dilemma.

The funding standoff has also dampened what the White House hoped would be a triumphant period for President Joe Biden on Covid, as cases fell and the administration laid out plans for a new, less disruptive phase of the pandemic. Instead, Biden is confronting a situation that could leave the federal government without the money to execute those plans — or respond to another surge.

The White House maintains that it needs billions more dollars to keep its core response efforts running, including purchasing more vaccines and treatments.

But a spending dispute prompted House Democrats last week to pull $15.6 billion in Covid aid from a broader omnibus package, and there is no clear path in Congress for passing that money in a separate bill.

The impasse has spurred White House warnings that treatments will begin running out by May absent more funding, with other pandemic programs — such as the system for reimbursing providers that care for uninsured patients — set to collapse even earlier.

“If we think this is all done,” Sen. Tim Kaine (D-Va.) said of the Covid crisis, “we’re being fools.”

Behind the scenes, health officials are scrambling to plan for additional disruptions — including the possibility they’ll need to shift certain treatments to the commercial market within months, meaning patients would need to go through private insurance or pay out of pocket.

On Tuesday, a senior administration official acknowledged to reporters that it is “exploring” such a move in the absence of additional funds.

“It takes time, as you know, to move to such a system,” the senior official said. “It needs to be an orderly, smooth transition.”

The administration first began discussing such a transition last year, as part of long-range planning for moving the government out of its crisis response mode and toward more sustainable management of the virus. Officials never set a timeline for that complicated changeover, and there had been no expectation it would occur any time soon.

But work accelerated after Congress abandoned its Covid funding plan, with officials trying to solve a series of logistical and regulatory challenges.

In internal discussions, some have floated moving select treatments to the commercial market, so as to better concentrate the government’s dwindling resources on high-priority therapeutics, one of the people with knowledge of the deliberations said.

But there’s no agreement yet on which should be prioritized or when that should happen, and it’s unclear how the government could ensure uninsured patients aren’t priced out of life-saving therapeutics.

Monoclonal antibody treatments, which can help keep high-risk Covid patients out of the hospital, can cost as much as $2,000 per course. The government has so far covered that price in full for all Americans regardless of insurance status — an arrangement that would end if the treatments were moved to the commercial market.

“With a reduced government role, we could see growing inequities,” said Larry Levitt, the executive vice president for health policy at the Kaiser Family Foundation. “For uninsured people, in addition to the health risks for Covid, there would be big financial risks as well.”

The administration also faces clear regulatory roadblocks. Most Covid treatments — including Pfizer’s highly effective antiviral pill — are still only authorized by the Food and Drug Administration for emergency use and can’t yet be sold commercially. That means that once the administration’s supply runs out, companies wouldn’t be able to make them available through private insurance.

The administration had originally envisioned Congress passing legislation to change that and allow Medicare and private insurers to cover treatments that aren’t fully approved, a White House official said. Yet it’s still unclear whether lawmakers would support that and how quickly a bill could be moved.

The Covid vaccines from Pfizer and Moderna are fully approved for certain age groups and could be transitioned to the commercial market. But administration officials are wary of the political and practical consequences of such a move, the people with knowledge said.

Doing so would represent a major departure from Biden’s consistent messaging of the vaccine as free and widely available, while raising fresh access and equity concerns.

It would also be difficult for individual insurers to compete with other nations to stockpile the shots, potentially leaving the U.S. shorthanded in the face of another virus surge.

Some health officials in the meantime have privately concluded that another booster shot will eventually be necessary, at least for high-risk Americans — strengthening the argument for keeping the vaccines under government control for as long as possible.

“We’re moving closer and closer to a fourth dose,” one of the people with knowledge of the deliberations said. “The only issue is timing.”

The administration in the interim has sought to more closely manage its existing supplies, in hopes that Congress can strike a deal soon enough to avoid major disruptions. On Tuesday, it told governors that regular shipments of monoclonal antibody treatments would be cut by 30 percent starting next week. Even after that reduction the government could still exhaust its supplies by late May.

As part of the internal discussions, officials have also examined the mechanics of cutting off federal support for certain treatments and then immediately resuming them as soon as Congress approves more money, another of the people with knowledge of the deliberations said.

Yet as White House and health officials game out scenarios, Congress appears no closer to a resolution. After Republicans demanded some of the planned $15.6 billion be paid for by clawing back pandemic aid from states and localities, some Democrats balked at the plan — forcing House leadership to pull the funding entirely from a broader omnibus package.

Democrats are subsequently trying to tee up a standalone measure that included different offsets. But Republicans are questioning whether more money is necessary at all, leaving no path to passage in the Senate.

White House officials have vowed to raise the pressure on Congress to find a compromise, issuing a list of the various Covid programs it planned to end or scale back unless funding is authorized. Still, there are no clear signs yet that approach is resonating on Capitol Hill.

“There’s a number of Republicans who won’t even return our phone calls about the impact of the lack of Covid funding,” press secretary Jen Psaki said Tuesday.

Alice Miranda Ollstein contributed to this report.

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