Childhood Vaccine Financing: Implications for States

1. Childhood Vaccine Financing: Implications for States National Vaccine Advisory Committee November 29, 2005 Washington, DC Lance E. Rodewald, MD Director, Immunization Services Division National Immunization Program, CDC

2. Topics • Sources of childhood vaccine financing • Financial implications of ACIP votes • Stress in the system: now and future • Next steps

4. Federal Contract Prices for Vaccines Recommended Universally for Children and Adolescents 1985 – 2005 $621 $155 $45 Federal contract price shown for 1985 and 1995 are averages that account for price changes within that year. The 2005 contract prices reflect prices on the Sept 1st, 2005. In 2005, Tdap replaced Td as the adolescent booster.

5. Childhood Vaccine Doses Distributed by Funding SourceCalendar Year 2004 Source: Biologics Surveillance Data 2004

6. Contrasts Among Government Funding Sources * Underinsured only at FQHC

7. ACIP Role in VFC Program • By statute: ACIP establishes, maintains, and revises the VFC vaccine list • According to Congress, with regard to VFC resolutions, ACIP should conduct its work objectively • Only concerns: public health and medicine • Work separated from budget considerations • Only Secretary can question validity of ACIP recommendation, and propose changes to Congress • Funding for vaccines in the ACIP list is mandatory, implying that ACIP can raise vaccine funding for about 45% of U.S. children by a vote

8. Childhood Vaccine Doses Distributed by Funding SourceCalendar Year 2004 Source: Biologics Surveillance Data 2004

9. Number of Children and Adolescents Who Could Potentially Receive Full Series with 317 funds 2005 estimate includes the cost to vaccinate one adolescent with one dose of Meningococcal and one dose of Td. 2004 and 2005 reflect new budget lines 1) Business Services Support and 2) Public Health Improvement & Leadership — which were created to the show CDC indirect cost assessments to programs Td was not included in the cost of the full series 1999-2004. States negotiated their own contracts because there was no federal contract for this vaccine. TdaP is expected to be licensed and recommended in FY2006; CDC estimates the new vaccine may be used 50% of the time in adolescents and the current Td vaccine used the remaining 50% of the time.

10. Pneumococcal Conjugate Vaccine (PCV) Two-Tier Policies, by State, United States* D.C. *As of February 2003 States with a two-tiered PCV policy (19 states are not implementing PCV with 317 funds)States without a two-tiered PCV policy If all States implemented PCV and flu, the 2004 funding shortfall would be $55 Million

11. Unresolved Problem of Underinsured • Public health safety net is missing in many locations • Underinsured crisis likely to worsen • Ethical tension for states and providers

12. ACIP Vote Implications • VFC entitlement must be fulfilled • States’ options for underinsured • Raise funding consistent with purchase policy • Selectively implement a vaccine • Providers’ options for underinsured • Ask parents to pay • Refer patients out, if possible • Take a financial loss? • Stop vaccinating?

13. New Vaccines and Vaccines on the Horizon

14. President’s Proposed Extension of Access to VFC Vaccine

15. Additional Challenges for States • State immunization requirements for children • Maintaining immunization insurance regulations in the face of ERISA • Responding to vaccine safety concerns • Responding to outbreaks • Managing vaccine supply issues • Cost sharing the VFC administration fee

16. Actual vs Allowable State Medicaid VFC Vaccine Administration Fees for CY2000 * * *Universal purchase states are allowed to develop their own maximum fees.

17. Cost to Administer Three Vaccines Medicaid average admin fee 2000 Fontanesi J et al. The Price of Prevention: Cost of Recommended Activities to Improve Immunization. Am J Prev Med 2003; 1:41-45.

18. NVAC Leadership in Vaccine Financing • Measles White Paper • Strategies to Sustain Success • Review of IOM report, “Calling the Shots” • Review of IOM “Financing Vaccines for the 21st Century” • Recommendations for financing vaccines

19. Conclusions • Childhood vaccine financing has not changed qualitatively since prior to the IOM vaccine financing study • VFC entitlement is a major benefit to the health of children, but its underinsured gap leaves the safety net vulnerable, especially for new vaccines • Administration fees vary substantially, and in many places do not support the service rendered by the provider • States face very difficult choices

20. How Can NVAC Help? • Evaluate the vaccine financing crisis through testimony and review of the evidence • Develop and publish strategic plan with key stakeholders to improve vaccine financing • Monitor and guide implementation of strategic plan

21. Extra Slides Start Here

22. Vaccine Purchase Policy: 50 States, DC, VI, PR: 2005

23. States with immunization mandates and/or universal programs (n = 51) VT NH WA ME MT ND MA OR MN NY SD WI RI MI ID WY PA AK IA NE DE OH NV IL IN UT WV CT VA CA CO KS MO MD KY NC DC TN AZ AR SC OK NM GA MS AL LA TX FL Mandate Only(AR, CA, CO, DE, DC, FL, GA, IL, KS, LA, MD, MI, MN, MS, MO, MT, NE, NJ, NY, OH, OK, PA, TX, VA, WVA, WI) Mandate and Universal(MA, NM, NC, RI) Mandate and Universal Select(CT, HI, ND) Universal or Universal Select Only (AK, ID, ME, NV, NH, SD, VT, WA, WY) No Mandate and No Universal or Universal Select (AL, AZ, IN, IA, KY, OR, SC, TN, UT) HI GWU/SPHHS/CHSRP Analysis of State Immunization Laws, Winter 2003