COVID-19 Stimulus Bill Brings New Healthcare Provisions Prior to Holidays
A COVID-19 relief package was agreed upon by bipartisan congressional leaders on December 20, 2020, just before the end of the year. The $900 billion COVID-19 relief package, the second-largest stimulus package in history, includes a multitude of provisions and federal spending that will take several weeks to unpack and interpret. As the effect on the healthcare industry is far reaching, more information and interpretations will most likely be released in the upcoming weeks. The 5,593-page 2021 Consolidated Appropriations Act was voted on and approved on December 21, 2020, before congressional leaders took a break for the holidays. The below summary is by no means an exhaustive list of all the provisions in the relief package, and we encourage you to refer to it for specific information related to each topic. Also see this previous BKD alert, which highlights other provisions that may be of interest to healthcare providers.
Some of the critical healthcare provisions in the relief package are as follows:
- Division N – Additional Coronavirus Response and Relief: Title I – Healthcare provides for the extension of temporary suspension of Medicare sequestration for an additional three months to March 31, 2021.
- Division M – Coronavirus Response and Relief Supplemental Appropriations Act, 2021 includes additional funding through the Public Health and Social Services Emergency Fund (PHSSEF) of $23 billion to prevent, prepare for, and respond to the coronavirus. In addition, the relief package includes another $22.4 billion in the PHSSEF for testing, contact tracing, surveillance, containment, and mitigation to monitor and suppress COVID-19. Also, the relief package clarifies that for any reimbursement to a subsidiary of a parent organization, the parent organization may allocate (through transfers or otherwise) all or any portion of such reimbursement among the subsidiary of the parent organization, including reimbursements referred to by the Secretary of Health & Human Services (HHS) as “Targeted Distribution” payments.
The relief package also contains language related to the Provider Relief Fund lost revenue calculation as such: “That, for any reimbursement from the Provider Relief Fund to an eligible healthcare provider for healthcare related expenses or lost revenues that are attributable to coronavirus (including reimbursements made before the date of the enactment of this Act), such provider may calculate lost revenues using the Frequently Asked Questions guidance released by HHS in June 2020, including the difference between such provider’s budgeted and actual revenue budget if such budget had been established and approved prior to March 27, 2020.” This provision in and of itself will create an additional option for eligible healthcare providers to calculate their lost revenues due to the coronavirus.
- Division BB – Private Health Insurance and Public Health Provisions:
- Title I – No Surprises Act requires health plans to hold patients harmless from surprise medical bills. It states that patients are only required to pay the in-network cost-sharing, i.e., copayment, coinsurance, and deductibles, amount for out-of-network emergency care for certain ancillary services provided by out-of-network providers at in-network facilities, and for out-of-network care provided at in-network facilities without the patient’s informed consent. It also requires that patients’ in-network cost-sharing payments for out-of-network surprise bills are attributed to a patient’s in-network deductible. In addition, the relief package goes on to list out provider requirements for surprise medical billing. Also, surprise air ambulance bills, transparency regarding in-network and out-of-network deductibles and out-of-pocket limitations, provider discrimination, and other items are addressed.
- Title II – Transparency requires increasing transparency by removing gag clauses on price and quality information, direct and indirect compensation for brokers and consultants to employer-sponsored health plans and enrollees in plans on the individual market, strengthening parity in mental health and substance use disorder benefits, and reporting pharmacy benefits and drug costs.
- Title III – Public Health Provisions:
- Subtitle A – Extenders Provisions provides for extending funding through 2023 for community health centers, the National Health Service Corps, and teaching health centers that operate GME programs. Funding for special diabetes programs also are extended through 2023.
- Subtitle B – Strengthening Public Health authorizes a national campaign on improving awareness of disease prevention and the development of a guide on evidence-based strategies for public health department obesity prevention programs. In addition, it authorizes the evaluation, development, and expansion of technology-enabled learning and capacity to build access and requires HHS to modernize the public health data systems used by the Centers for Disease Control and Prevention (CDC). It also authorizes several other programs.
- Subtitle C – FDA Amendments allows for the Food and Drug Administration (FDA) to continue the rare pediatric disease priority review voucher program. In addition, for orphan drugs, it clarifies the clinical superiority standard applies to all drugs with an orphan drug designation and for the FDA to identify and select modernizing the labeling of certain generic drugs.
- Division CC – Health Extenders:
- Title I – Medicare Provisions:
- Subtitle A – Medicare Extenders includes several provisions ranging from extending the work geographic index floor under the Medicare program, funding for quality measure endorsement, input and selection, extending funding outreach and assistance for low-income programs, and several others.
- Subtitle B – Other Medicare Provisions: Like Subtitle A, there are many provisions in this section of the relief package. Here are a few highlights:
- Improving measurements under the skilled nursing facility value-based purchasing program under the Medicare program by allowing the Secretary of HHS to add up to 10 quality measures
- Prohibits the Secretary of HHS from making payments under the Physician Fee Schedule for procedures described by Healthcare Common Procedure Coding System code G2211 prior to January 1, 2024
- Instituting a temporary freeze of APM payment incentive thresholds
- Expands access to mental health services furnished through telehealth to Medicare beneficiaries
- Medicare payment for rural emergency hospital services by creating a new, voluntary Medicare payment designation that allows either a critical access hospital or a small rural hospital with fewer than 50 beds to convert to a Rural Emergency Hospital (REH). The REH will be reimbursed based on Medicare prospective payment systems, plus an additional monthly facility payment and an add-on payment for hospital outpatient services
- Extending for five years the Rural Community Hospital Demonstration designation, which is paid using a reasonable, cost-based methodology
- Implements a comprehensive rural health clinic (RHC) payment reform plan to increase the RHC cap to $100 starting April 1, 2021, and gradually increase the upper limit each year through 2028 until the cap reaches $190
- Provides for RHCs and federally qualified health centers (FQHC) to furnish and bill for hospice services when RHC and FQHC patients become terminally ill and elect the hospice benefit, beginning January 1, 2022
- Distribution of additional GME residency positions for rural hospitals, hospitals that are above their Medicare cap for residency positions, hospitals in states with new medicals schools, and hospitals that serve Health Professional Shortage Areas
- Title II – Medicaid Extenders and Other Policies: The Medicaid extenders and other policies include several provisions; however, this article only covers a few of the provisions below due to the high volume. We recommend you review the relief package text for additional provisions.
- Eliminates the DSH payment reductions for fiscal years 2021, 2022, and 2023 and adds reductions to fiscal years 2026 and 2027
- Establishes a system for supplemental payment reporting to CMS by states including the amount of supplemental payments made to each eligible provider
- Establishes that state Medicaid programs cover nonemergency medical transportation to necessary services. It also requires states to comply with certain program integrity standards
- Title III – Human Services
- Provisions in this section extend the current funding for programs such as the Temporary Assistance for Needy Families, the Child Care Entitlement to States and other related programs, the Personal Responsibility Education Program, and Sexual Risk Avoidance Education and Health Professions Opportunity grants, among others, for the upcoming year and into the future. See the actual relief package text for specifics on the years that each program was extended
- Title IV – Health Offsets
This section includes provisions ranging from drug pricing requirements to the Medicare improvement fund. We recommend reviewing the text of the relief package for full details.
- Requires all manufacturers to report drug pricing information with respect to drugs covered under Medicare Part B to report average sales price information to the Secretary of HHS beginning on January 1, 2022
- Extends months of coverage of immunosuppressive drugs for kidney transplant patients and other renal dialysis provisions
- Allows direct payments to physician assistants under the Medicare program for services provided to Medicare beneficiaries on or after January 1, 2022
- Adjusts the calculation of the hospice aggregate cap amount by using the hospice payment update percentage rather than the Consumer Price Index for Urban Consumers for fiscal years 2026 through 2030
- Makes changes to the hospice program survey and enforcement procedures under the Medicare program to improve consistency and oversight
- Title I – Medicare Provisions:
Overall, the bipartisan relief package is far reaching and proposes additional funding and requirements to programs and policies, and the details surrounding these changes will continue to evolve in the upcoming days, weeks, and months.
As with most topics related to COVID-19, changes are rapidly occurring and continuing to monitor the information will be critical to understanding the overall effect. The information contained in this article is current as of the date of this publication. For more information, contact your BKD Trusted Advisor™ or submit the Contact Us form below.
Want even more insight on the relief package? Join BKD Trusted Advisors™ for “Consolidated Appropriations Act, 2021 Town Hall for Healthcare” on Friday, January 8, at 11 a.m. Central time. Register Today!