Health Policy Report (4/18)

Capitol Hill Update

Congress has adjourned for a two-week state work period for the Easter and Passover holidays. The Senate will return on Monday, April 25, with the House returning a day later on Tuesday, April 26.

HHS Renews PHE for 90 Days

On April 12, Department of Health and Human Services (HHS) Secretary Xavier Becerraannounced an extension of the COVID-19 public health emergency (PHE) for an additional 90 days. Former HHS Secretary Alex Azar issued a PHE declaration on January 27, 2020, for COVID-19 which he renewed four times until the administration changed. Secretary Xavier Becerra has renewed the PHE an additional five times, including last week’s announcement.

Effective April 16, 2022, this extension marks the continuation of several temporary authorities afforded under the PHE, including continuous enrollment requirements, waivers of telehealth restrictions, and additional federal medical assistance percentage (FMAP) increases, among other items. For more detail about Medicare- and Medicaid-specific flexibilities afforded under the COVID-19 PHE, read TRP’s Special Report outlining these provisions.

HRSA Distributes $1.75 Billion in Provider Relief Funding

On Wednesday the Health Resources and Services Administration (HRSA)announced approximately $1.75 billion in Provider Relief Fund (PRF) allocations to over 3,000 providers. This round of funding represents part of Phase 4 payments, which are designed to reimburse providers who experienced higher rates of loss during the COVID-19 pandemic and serve Medicare, Medicaid, and Children’s Health Insurance Program (CHIP) beneficiaries. After this distribution, roughly $4.5 billion remains in the PRF, and about 92 percent of Phase 4 applications have been processed. 

Biden Administration Focuses on Rural Health Care Ahead of Midterm Elections

The Biden administration has tapped Tom Vilsack, the Secretary of the Department of Agriculture (USDA), to be the administration’s spokesperson on rural health care infrastructure. Last week, Vilsack announced that USDA has awarded $43 million in grants to rural health care providers in 22 states — the first tranche of rural health care funding allocated in the American Rescue Plan (ARP).

Additionally, the administration recently unveiled aplaybook highlighting the impact of the Bipartisan Infrastructure Law (BIL) on rural areas. This focus on rural health care comes as midterm election season looms, and Democrats hope to maintain their slim margins in both chambers.

CMS Proposes FY 2023 SNF Payment Updates

The Centers for Medicare and Medicaid Services (CMS) has begun publishing its proposed rules to update various prospective payment systems for health care providers and other payment rates in fiscal year (FY) 2023. Payment rules update payment methodologies for each prospective payment system, and the agency often packages policy changes along with the updates. On Tuesday, CMS proposed an annual update to Medicare payment policies and rates for skilled nursing facilities (SNF) for fiscal year (FY) 2023 (TRP analysis; fact sheet; press release). Under the proposed rule, Medicare Part A payments would see a decrease of roughly $320 million in FY 2023 as a result of the aggregate impact of the proposed payment policies. While SNF payments would be increased by 3.9 percent in FY 2023 — a projected $1.4 billion increase over FY 2022 — CMS is proposing a 4.6 percent Patient Driven Payment Model (PDPM) parity adjustment reduction that is expected to reduce SNF spending by $1.7 billion in FY 2023. 

The agency is also issuing requests for information (RFI) on several measures, including: (1) two SNF QRP quality measures under consideration for future years; (2) practices for measuring health equity and quality disparities across CMS programs; and (3) inclusion of the CoreQ: Short Stay Discharge measure in a future SNF QRP program year. Notably, CMS is interested in feedback related to best practices in reducing nursing home staff turnover and the impact of such turnover on health equity. The agency also outlined its intent to issue proposed rules pertaining to minimum staffing levels for nursing homes within one year for the SNF VBP Program.