CMS and MedPAC Guidelines and Trends

Hospital provisions could end up in the next coronavirus bill passed by Congress

May 26, 2020 6:11 pm
  • Congress is expected to enact another major coronavirus law with hospital provisions by early July.
  • Additional grants totaling $100 billion — and directions on who should get them — were included in the House-passed version.
  • Ongoing negotiations are likely to see certain hospital-related provisions tossed or added.

A range of hospital-sought funding and policy provisions may survive coming negotiations in Congress over the next major coronavirus bill, observers say.

The opening marker for the next bill was the HEROES Act, which the U.S, House of Representatives passed May 15 mostly along partisan lines. The Democrat-led bill was described as “dead on arrival” by Senate Majority Leader Mitch McConnell (R-Ken.).

But hospital advisers are optimistic that ongoing negotiations in Congress will result in a final legislative package that includes the provisions most beneficial to hospitals, as well as others that were not included in the HEROES Act.

“We do hope, as the two chambers continue to talk, that there are provisions included in the HEROES Act that certainly should find their way into whatever final agreement is reached,” Carlos Jackson, vice president of legislative affairs for America’s Essential Hospitals (AEH), said in an interview. “It’s more of a possibility that something happens, rather than nothing; it’s just the timing of when that happens and what does it look like?”

“It’s likely that there will be one more large coronavirus package,”  said Emily Felder, JD, senior policy adviser and counsel for Brownstein, Hyatt, Farber and Schreck.

HEROES provisions for hospitals

Key hospital provisions in the HEROES Act include:

  • $100 billion in grants (added to $175 billion previously appropriated) for hospitals and other healthcare providers
  • Leeway on repayment of Medicare advance payments
  • Elimination of cost sharing for Medicaid beneficiaries and the uninsured for COVID-19 treatment
  • Moratorium on implementation of an overhaul of Medicaid regulations
  • 14% increase in Federal Medical Assistance Percentage (FMAP) payments to state Medicaid programs
  • Full premium subsidies for COBRA coverage through January 2021

A key provision was the inclusion of language specifying various ways the $100 billion in provider assistance should be disbursed. Some hospitals have been critical of the disbursement approaches taken by the U.S. Department of Health and Human Services (HHS) for the previously appropriated provider grants.

“It’s an acknowledgement that there is a lot of criticism about how HHS initially allocated dollars,” Felder said.

Critics noted HHS likely paid less than half of the funds to hospitals, even though they lost a much greater share of revenue than did other providers as they were required to continue operating during the pandemic, she said.

The bill also would target the Medicaid Fiscal Accountability Regulation (MFAR) proposed rule, which would add more scrutiny to state supplemental payments, among other provisions.

Although AEH was supportive of the bill’s suspension — for the duration of the public health emergency of rule changes the Trump administration has proposed for Medicaid, they would like the pause to last two years longer. That’s because they don’t expect the revenue snap-back by the end of this year that some hospitals anticipate.

“I don’t think we’re going back to the way things were; you’re not simply flipping a switch, returning to the way healthcare was delivered,” Jackson said. “As long as there is still some uncertainty, we should have some certainty around the federal safety-net supports that our hospitals depend on, like supplemental payments.”

The bill’s tweaks to the Medicare Accelerated and Advance Payment Program — through which payments are effectively loans and cover three or six months of an organization’s typical Medicare payments — include a reduction in the interest rate applied to any funds not repaid after a year. AEH also wants Congress to go further on this provision by broadly forgiving such loans, such as for safety net hospitals that sometimes have less than 10 days cash on hand.

Other provisions sought

Advocates hope the Senate takes additional steps to stabilize hospitals.

For instance, seven national hospital groups and others recently wrote a letter urging Congress to include “provisions to shield from unwarranted liability the facilities and providers responding in good faith to prepare for and treat patients during the pandemic.”

“To further secure the care for patients and prevent obstacles to service, it is vital the next legislative package also includes additional crucial priorities such as COVID-19 medical liability protections for hospitals and caregivers,” Chip Kahn, president and CEO of the Federation of American Hospitals, said in a written statement.

The ongoing negotiations also may see an effort to add provisions that would make permanent Medicare telehealth waivers issued during the public health emergency. The waivers allow much broader use of telehealth.

“Hospitals like the additional flexibility,” Felder said.

Jackson said passage of a final package was possible in June but could come as late as the July 4 recess.



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