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Report: Biden administration gave drugmakers $7 billion meant for hospitals

Many healthcare providers disagree with the decision

January 27, 2022 4:42pm

Updated: January 27, 2022 4:45pm

The Biden administration took nearly $7 billion allocated for medical facilities during the pandemic and used it to purchase COVID-19 vaccines and therapeutics, STAT News reported Wednesday.

The money came from the Provider Relief Fund (PRF) and the U.S. Department of Health and Human Services announced on Tuesday that $2 billion in payments from the PRF would be distributed this week. The following day, STAT reported that the fund is now empty and does not have any money to left to distribute. The PRF only covers medical expenses up to March 31, 2021, not the most recent COVID surges.

In total, pharmaceutical manufacturers have received $17 billion, which is about 10% of the overall funding Congress gave for the medical fund, according to STAT. The PRF was created by Congress to put money aside to assist hospitals and medical clinics struggling with COVID-related costs, such as taking care of uninsured patients and distributing vaccines.

An HHS spokesperson defended the funding change. "All Provider Relief Fund dollars have been used for Provider Relief Fund purposes,” the spokesperson told STAT.

Many healthcare providers disagree with the decision.

Catholic Health Association President and CEO Sister Mary Haddad said: "While we agree there is a need to provide funding for Covid vaccines and treatments, CHA members continue to face mounting financial and operational challenges as they care for Covid patients."

"We would be deeply troubled and frustrated to find out that billions of dollars have been siphoned off from the fund, especially since no funds have been allocated to the Delta or Omicron surges," American Hospital Association executive vice president Stacey Hughes told STAT.

The American Hospital Association is asking Congress to allocate $25 billion in additional PRF funding.

The Trump administration similarly diverted $10 billion from the PRF for Operation Warp Speed to develop the COVID-19 vaccine.