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June 9, 2022

White House shifts Covid-19 funds toward acquiring vaccines

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    With additional Covid-19 response funding stalled in Congress, the White House on Wednesday announced it is cutting funding from some Covid-19 response areas in order to prioritize acquiring more vaccines.

    Our take: 10 health policy topics—including Covid response—to watch in 2022

    Where Covid-19 funding stands

    In March, Democrats and Republicans agreed to provide $15.6 billion in funding for Covid-19 vaccines and treatments as part of a larger $1.5 trillion omnibus bill.

    However, House Republicans argued the Covid-19 funding would need to be offset by tapping into $7.1 billion in coronavirus relief funds that have yet to be distributed to 30 states. This led House Speaker Nancy Pelosi (D-Calif.) to cut the Covid-19 funds from the omnibus bill so the issue could be debated and passed separately.

    Since then, the funding has been stalled in Congress. Some Republicans have argued they don't believe the new funds are urgently needed.

    "There are all these, I think, other issues right now that have just kind of eclipsed it in terms of their need to be dealt with," Sen. John Thune (R-S.D.) said. "So I mean, obviously, at some point, vaccines and therapeutics, it's something we're probably going to have to deal with one way or another."

    In addition, Republicans and a handful of Democrats have been looking to add an amendment to the funding bill that would reverse the Biden administration's action rescinding Title 42, a public health policy enacted by the Trump administration that limited migration at the border and blocked migrants from seeking asylum in March 2020 due to public health concerns.

    When asked in May if he'd allow a vote on reinstating Title 42 in order to get Covid-19 funding passed, Senate Majority Leader Chuck Schumer (D-N.Y.) said, "We'll see what the House sends over."

    However, House Majority Leader Steny Hoyer (D-Md.) said the House passing funding first wouldn't "magically" solve the need for 60 votes in the Senate to overcome a filibuster. "The Senate needs to get this done," he said.

    White House announces it will shift Covid-19 funding

    According to the White House, funding will be cut from areas of Covid-19 response like testing and new vaccine research and instead diverted towards purchasing more vaccines and treatments.

    Specifically, the White House said $5 billion will go towards purchasing updated vaccines for the fall, $4.9 billion will go towards purchasing 10 million courses of the Covid-19 treatment Paxlovid, and $300 million will go towards purchasing more monoclonal antibody treatments.

    Despite this shift, the White House said there likely still won't be enough funding to purchase updated Covid-19 vaccines for all Americans this fall unless more funding is provided by Congress. The total amount needed for a new vaccination campaign later this year is still unknown because contract negotiations are ongoing.

    "Due to a lack of additional funding, HHS is now forced to pull funds from other essential elements of our response to meet some basic COVID-19 response needs," a White House official said. "This will allow the U.S to get in line to procure some additional lifesaving vaccines for the fall, including next-generation vaccines if available, and procure additional lifesaving treatments. We will still not have the resources needed to secure enough vaccines for all Americans who may want them this fall."

    The White House said the funding cuts will hurt capacity for domestic testing and will reduce investments into the research and development of next-generation Covid-19 vaccines.

    "The administration has to act because Congress won't," the White House said in a statement. "These trade-offs we are being forced to make because of Congress will have serious consequences on the development of next-generation vaccines, therapeutics and diagnostics, domestic vaccine production capacity, stockpiling of PPE and the procurement of tests and testing supplies for federally qualified and community health centers."

    Ashish Jha, the White House's Covid-19 response coordinator, said purchasing new vaccines and treatments couldn't wait until the fall.

    "If you want to ask what keeps me awake at night, it is that we are going to run out of vaccines," he said. "We're not going to be able to have enough of the next generation of vaccines. We're going to run out of treatments. And we're going to run out of diagnostic tests, probably in the late fall into winter, if we end up having a significant surge of infections."

    Jennifer Nuzzo, an epidemiologist at Brown University School of Public Health, said the United States isn't going to be able to track variants as well given the shift in funding.

    "Because we can't get our act together to pass the funding, it's like trying to decide between which of your children you're going to save," she said. "My worry is this is not only compounding the stark toll of the virus, but compounding the disparities." (Sullivan, The Hill, 6/8; Weiland, New York Times, 6/8; Reed/Bettelheim, Axios, 6/9; Miller, Associated Press, 6/8)

    Health policy topics to watch in 2022

    The legislative, regulatory, and judicial outlook for health policy in 2022


    The Biden administration's first year in office was unsurprisingly dominated by the Covid-19 pandemic. While Democrats in Congress were able to pass part one of President Biden’s infrastructure package, other health care priorities were largely sidelined. As we look to 2022, there are 10 key health care topics that are ripe for congressional or regulatory action. If and how Congress and the Biden administration move on those actions will have strategic implications for industry executives across the health care ecosystem.

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