Nurse Valarie Tyree gives a man a dose of the Moderna COVID-19 vaccine during “Senior Weekend” at Richmond Raceway in Richmond, Va., Feb. 2, 2021. Virginia officials are bracing for the loss of federal funding for COVID-19 treatment and testing for the uninsured. (Parker Michels-Boyce/ For the Virginia Mercury)
Since the start of the COVID-19 pandemic, a federal program has reimbursed more than $99 million to Virginia providers for offering testing and treatment to uninsured patients.
But state health officials said they were notified this week that the program, administered by the U.S. Health Resources and Services Administration, had run out of money, bringing those reimbursements to a sudden halt. Repayment for claims related to testing and treatment, including monoclonal antibodies and oral antivirals, ended Tuesday, according to the Virginia Department of Health. Reimbursements for administering vaccinations will end on April 5.
The funding has supported care for the roughly 648,000 Virginians without health insurance, a group that’s particularly likely to face financial vulnerabilities or medical comorbidities that make them especially susceptible to the virus, experts say.
The news came as a shock to Virginia’s safety net providers amid an ongoing federal debate over additional COVID-19 spending. Earlier this month, U.S. House Speaker Nancy Pelosi stripped $15.6 billion in emergency aid from a larger funding package as Republicans demanded a closer inspection of how previous COVID dollars had been spent, The New York Times reported.
With no agreement on the horizon, both state and local health officials are still working to determine how the deadlock will affect pandemic management.
“I’m not aware that there was much advance notice of this,” said Dr. Laurie Forlano, VDH’s deputy commissioner for population health. “We’re still trying to gather information and assess potential impact and think about how we might need to right-size our budget accordingly.”
Spokespeople for Gov. Glenn Youngkin did not respond to questions on whether the administration was considering a shift in state spending to make up for the loss of federal dollars. The most immediate impact will likely be shouldered by medical providers offering direct care to some of Virginia’s most vulnerable residents.
That’s because much of the state’s federally funded programming is supported through 2023 or 2024, according to VDH. When it comes to vaccines, for example, Virginia has received more than $169 million in grants to support storage, distribution and administration of the shots — funding that won’t expire until June 2024. Christy Gray, the state’s vaccination coordinator, said Virginia also has enough supply to offer first and second shots, as well as booster doses, to any resident who wants them.
“It’s not like the supply doesn’t exist in the field,” she said. Likewise, much of the state’s testing is supported by grants to expand laboratory capacity and support detection in cases of outbreaks and community events. The funding, which extends through July of 2023, also supports test kits distributed through libraries and offered in congregate settings like daycares and colleges, according to the department.
But the reimbursement program for free clinics and other community providers has supported the staffing and administrative expenses that go into treating and vaccinating patients throughout the pandemic, Gray said. According to Forlano, most also pay for their own testing supplies along with the staff needed to see patients. Without repayment for those services, there’s concern some practices may not be able to handle the additional cost of managing the pandemic along with their regular medical care.
“So what might become a problem is a reduction in vaccinators,” Gray said. “Because for every uninsured person, they’re eating those costs.”
The current funding debate is taking place amid a precipitous plunge in cases, which in Virginia have dropped to levels not seen since August of 2021, according to a recent report by the University of Virginia’s Biocomplexity Institute. Hospitalizations have also dropped dramatically, and while a handful of districts are currently experiencing a slow growth in cases, there’s hope that the state may avoid another spike thanks to warming weather and an increase in both vaccine and so-called natural immunity from prior infections with the omicron variant, which is also protective against the growing subvariant BA.2.
The drop in transmission levels, along with a decrease in severe outcomes, has allowed state health departments and many local providers the chance to scale back their services and focus on targeted outreach. The Richmond-Henrico Health District, for example, recently expanded their “Doses on Demand” program, allowing any local resident to schedule an at-home vaccination with local nurses.
But the uncertain future of federal funding has created doubt about the state’s ability to respond to future surges or new developments with the virus, including new variants, said Ruth Morrison, the district’s policy director. While the funds remain in place for many state programs, some key initiatives are at risk of being discontinued by this summer. Funding for screening and diagnostic testing in K-12 schools, for example, is set to expire at the end of July. Reimbursement for mass vaccination sites is expected to end at the end of June.
As demand for the shots has dropped to record lows, that’s less of a concern for some officials than the expiration of reimbursement for mobile clinics, which have been serving an increasingly important role in reaching undervaccinated populations — including Virginia’s Medicaid enrollees. Funding for the state’s COVID-19 call center will also expire this summer, meaning the state will likely be forced to end those initiatives, according to VDH spokesperson Logan Anderson.
“It sows a level of doubt into the operational, on-the-ground reality not just for public health, but also for health systems and federally qualified health centers and the ecosystem of providers who have been relying on federal dollars for two years now,” Morrison said.
Julian Walker, vice president of communications for the Virginia Hospital and Healthcare Association, said the state’s health systems are also still rebuilding after a dramatic increase in COVID-related costs along with an initial decline in emergency and in-patient admissions.
“Inaction in Washington that results in a discontinuation of pandemic-related support could have harmful implications for patients and health care providers who have already endured so much,” he wrote in a statement.
The issue is personal not only for local health districts and hospital systems, but community providers who have spent more than two years offering support to un- and under-insured Virginians in some of the state’s most high-risk areas. Currently, it’s unclear whether the impasse over federal funding will affect the supply of treatments such as monoclonal antibodies, which — thanks to their current federal authorization status — can’t be independently purchased by the private sector.
That’s a big concern for Dr. Teresa Owens Tyson and Paula Hill-Collins, executives with The Health Wagon, a free clinic in Southwest Virginia. One of the least-vaccinated areas of the state, the organization has tested more than 5,000 patients since the height of the omicron surge and administered nearly 6,000 monoclonal antibody treatments.
Some of Virginia’s far southwestern counties remain the few areas of the state where community transmission levels are rated as high under new guidelines from the U.S. Centers for Disease Control and Prevention. In some areas, less than 50 percent of the population has been fully vaccinated. With so many vulnerable patients, both providers are warily awaiting more information about potential funding and supply cuts.
“We don’t have the resources or the hospitals to support another surge,” Hill-Collins said. “If our supply of treatments goes down, there’s no doubt it will cause people to lose their lives.”
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