Weekly Health Care Policy Update – July 23, 2021

July 30, 2021

In this update: 

  • Federal Administration
    • Biden Administration Announces Updates on COVID-19 Response 
      • HHS Renews COVID-19 Emergency
      • CDC Says Delta Represents 83% of COVID-19 Cases
      • HHS Awards $100 Million to Rural Health Clinics
      • HHS Awards $1.6 Billion for Testing in High-Risk Congregate Settings
  • Federal Regulation
    • CMS Releases 2022 OPPS and ASC Payment System Proposed Rule
    • Updated Provider Relief Fund Guidance
    • CMS Issues Bulletin Emphasizing Reversal of “Public Charge” Rule
    • HHS Issues RFPs for $103 Million for Health Workforce Resiliency
  • Other
    • AAMC Recommends Members Require Employee Vaccination
    • AAP Issues Mask Recommendation for Schools
    • CDC Reports Largest One-Year Decline in Life Expectancy Since WWII
  • Congressional Hearings
  • New York State Updates
    • Governor Cuomo Signs Legislation on Adult Social Day Services and DOH Outreach and Education Programs
    • UHF Releases 2021 Medicaid Conference Recording
    • DFS Issues Guidance on Disaster Emergency Planning for Regulated Insurers
    • OIG Says New York Improperly Claims $439 Million for School-Based Medicaid Services
    • NYS Opens Applications for Public Health Corps Fellowship Program

Administrative Updates

Biden Administration Announces Updates on COVID-19 Response
This week, the Biden Administration announced new updates on the COVID-19 response: 

  • HHS Renews COVID-19 Emergency: On July 19th, Secretary of Health and Human Services (HHS) Xavier Becerra renewed the federal Public Health Emergency (PHE) declaration for COVID-19 under the Public Health Service Act for another 90 days. The PHE would now expire October 18th without further action, but HHS has indicated that it will be extended at least through the end of 2021. The declaration can be found here.
  • CDC Says Delta Represents 83% of COVID-19 Cases: On July 20th, Centers for Disease Control and Prevention (CDC) director Rochelle Walensky told a congressional hearing that the Delta variant now accounts for 83% of sequenced COVID-19 cases in the United States. Delta may account for up to 90% of cases in areas of the country with low vaccination rates. The new numbers represent a significant increase in the prevalence of Delta, which represented roughly 50% of cases during the week of July 3rd.
  • HHS Awards $100 Million to Rural Health Clinics: On July 22nd, HHS announced the release of $100 million in American Rescue Plan (ARP) funding to nearly 2,000 rural health clinics to support vaccine education and outreach in areas with low vaccine uptake. Each organization will receive approximately $49,500 per clinic site.
  • HHS Awards $1.6 Billion for Testing in High-Risk Congregate Settings: On July 22nd, HHS also announced an additional $1.6 billion in ARP funding to bolster testing and mitigation efforts in high-risk congregate settings such as mental health and substance abuse treatment centers, homeless shelters, domestic violence shelters, and prison systems. Specifically, the Substance Abuse and Mental Health Services Administration (SAMHSA) will invest $100 million to expand dedicated testing resources through the Substance Abuse Treatment and Prevention and Community Mental Health Services block grant programs. Funds may support workforce needs (including contact tracers), training and technical assistance to implement rapid on-site testing, personal protective equipment (PPE), and supporting mobile health units.

Regulatory Updates

CMS Releases 2022 OPPS and ASC Payment System Proposed Rule
On July 19th, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule regarding the Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) Payment System for calendar year (CY) 2022. The proposed rule updates regulations regarding, among other topics: 

  • Hospital OPPS payment, including maintaining current 340B drug payment levels and reverting the Inpatient Only (IOP) list;
  • ASC payment, including reverting the ASC Covered Procedures List (CPL);
  • Hospital price transparency requirements;
  • Minor changes to the Quality Reporting Program;
  • A request for information on the definition of Rural Emergency Hospitals;
  • A request for comment on the continuation of COVID-19 policies; and
  • Changes to the Radiation Oncology model.

The proposed rule would increase both OPPS rates and ASC payment rates by 2.3 percent. CMS estimates that total payments to OPPS providers (including beneficiary cost-sharing and estimated changes in enrollment, utilization, and case-mix) in CY 2022 would be approximately $82.704 billion, which is an increase of approximately $10.757 billion compared to estimated CY 2021 OPPS payments. CMS estimates that proposed changes for ASCs will lead to approximately $5.16 billion in total payments to ASCs (including beneficiary cost-sharing and estimated changes in enrollment, utilization, and case-mix) in CY 2022, a decrease of approximately $20 million compared to estimated CY 2021 payments.

The full text of the proposed rule is available here. SPG has separately distributed a more detailed summary available here.

Updated Provider Relief Fund Guidance
Over the last several weeks, HRSA has posted updated guidance under its Frequently Asked Questions (FAQ) pages regarding reporting requirements for providers who received money through the Provider Relief Fund (PRF). In particular, HRSA has clarified the procedure for organizations to calculate their lost revenue. Providers may calculate lost revenue using any of three options:

  1. Difference in year-over-year actual patient care revenues for each quarter (i.e., using 2019 results as the baseline);
  2. Difference between budgeted revenue and actual patient care revenue (a budget must have been established by March 27, 2020); or
  3. Any other reasonable method. HRSA will let a reporting entity know if their proposed methodology is not reasonable and the entity is required to resubmit its report within 30 days of notification.

Quarters in which there are no lost revenues, or revenue increases year-over-year, will be disregarded, and all applicable quarters’ lost revenues will be summed together. As such, lost revenues may be carried forward and applied to future receipts of PRF funding. Some other notable updates include:

  • Unused Funds: Unused funds should be returned within 30 days of the end of the reporting period. HHS has opened the “Return Unused RPF Funds Portal” for this purpose. For example, providers who received funds before June 30, 2020 must: 
    • Complete spending by June 30, 2021;
    • Complete reporting by September 30, 2021; and
    • Return funds by October 30, 2021.
  • Sold, Terminated, or Transferred Practices: If an organization has sold or otherwise terminated a practice, it may retain PRF funding if (1) the entity it sold was included in its most recent tax return gross receipts or sales figure and (2) the organization otherwise met PRF Terms and Conditions, including spending the funds on acceptable purposes.
  • Grants for FQHCs and FQHC Look-Alikes: Federally-Qualified Health Centers (FQHCs) and FQHC Look-Alikes must fully draw down COVID-19 supplemental grant awards before PRF payments can be used.
  • Rent/Mortgages and Remote Staff: Rent or mortgages paid while staff worked remotely could be claimed as an eligible expense if considered a health care-related operating expense. The provider must provide documentation to show that expenses are to prevent, prepare for, and respond to coronavirus.
  • FEMA Overlap: The FAQs contain further guidance about how to handle reporting of funds from the Federal Emergency Management Agency (FEMA). In particular, providers should not report requested FEMA funds until they are received. If a provider receives a retroactive FEMA payment, it must not be used on expenses covered by PRF payments.
  • Purchases for Others: The reporting entity does not need to be in receipt of purchases made using PRF payments in order for the expense to be considered eligible for reimbursement.
  • Charity Care and Contractual Adjustments: Reporting entities should not include charity care adjustments or contractual adjustments from third-party payers in their calculation of “patient care-related revenue” for the purposes of lost revenue.
  • Non-Financial Data to be Submitted: Patient metrics must be submitted for the following: 
    • Inpatient admissions;
    • Outpatient visits (in-person and virtual);
    • Emergency department visits; and
    • Number of facility stays (for long-term and short-term residential facilities).
  • No Extensions: Providers are not able to request extensions on submissions of required reports or the deadline to use funds.
  • Appeals/Disputes: HHS is developing a structured reconsiderations process to review and reconsider payment accuracy. More details will be provided in coming weeks.

The PRF FAQs can be found here. 

CMS Issues Bulletin Emphasizing Reversal of “Public Charge” Rule
On July 22nd, the Center for Medicaid and CHIP Services (CMCS) at CMS released an informational bulletin reminding states that the Trump Administration’s 2019 “Public Charge” rule has been vacated and is no longer in effect. The 2019 rule made certain legal immigrants ineligible to receive green cards (i.e., become permanent residents) if they received various public benefits, including Medicaid, but the Department of Homeland Security has since reverted to its previous public charge policy, which only allows the consideration of Medicaid as part of a public charge determination in the case of individuals in long-term care institutions. The bulletin also emphasizes that because states may not share information about beneficiaries for purposes unrelated to administration of the Medicaid program, State Medicaid programs should not provide DHS with information about individuals’ Medicaid benefits, even in the case of institutionalized beneficiaries.
 
The bulletin is available here.
 
HHS Issues RFPs for $103 Million for Health Workforce Resiliency
On July 16th, the Health Resources and Services Administration (HRSA) at HHS issued Requests for Proposals (RFPs) that offer roughly $103 million to reduce burnout and promote mental health among the health workforce. The three-year funding, from the American Rescue Plan, will focus primarily on the needs of rural and medically-underserved communities, within three distinct funding opportunities: 

  1. Promoting Resilience and Mental Health Among Health Professional Workforce: approximately 10 awards totaling $29 million over three years to establish, enhance, or expand programs promoting a culture of wellness;
  2. Health and Public Safety Workforce Resiliency Training Program: approximately 30 awards totaling $68 million over three years for educational institutions and other appropriate state, local, Tribal, public, or private nonprofit organizations training those early in their health careers to reduce burnout, suicide, and promote resiliency; and
  3. Health and Public Safety Workforce Resiliency Training Assistance Center: one award for $6 million over three years to provide tailored training and technical assistance to HRSA’s workforce resilience programs.

SPG will shortly distribute separate summaries of the RFPs. Applications are due on August 30th. More information is available here.

Other Updates

AAMC Recommends Members Require Employee Vaccination
On July 16th, the Association of American Medical Colleges (AAMC) issued a statement recommending that AAMC members require vaccination for employees. The statement notes the “alarming resurgence” in Covid-19 infections as well as the “increasing evidence that those currently unvaccinated continue to be at high risk of acquiring Covid-19 and are the overwhelming majority of new hospitalizations.” AAMC’s member institutions include 172 accredited U.S. and Canadian medical schools, over 400 teaching hospitals and health systems, and over 70 faculty and academic societies. Other groups recently recommending or expressing support for employee vaccination include the American Hospital Association, America’s Essential Hospitals, and the Association for Professionals in Infection Control and Epidemiology.
 
The AAMC’s full statement is available here.
 
AAP Issues Mask Recommendation for Schools
On July 19th, the American Academy of Pediatrics (AAP) recommended that everyone over age 2 wear masks in school this fall. The recommendation conflicts with that of the CDC, which largely recommends masking only for the unvaccinated. In recommending universal masking, the AAP argued that many students are too young to be eligible for vaccines, and that mask wearing would protect this group by lowering overall transmission rates, particularly given more transmissible virus variants. Overall, however, the AAP notes that “the benefits of in-person school outweigh the risks in almost all circumstances” and that “everything possible must be done to keep students in schools in-person.”
 
The AAP’s full set of recommendations is available here.
 
CDC Reports Largest One-Year Decline in Life Expectancy Since WWII
On July 21st, the CDC reported that life expectancy for Americans dropped by 1.5 years in 2020, to 77.3 years. It is the largest one-year decline in life expectancy since World War II. The CDC attributes 74% of the decline to the COVID-19 pandemic, but drug overdoses, homicide, diabetes, chronic liver disease, and cirrhosis were also contributing factors. For Hispanic and Black Americans, life expectancy fell by roughly three years, the worst decrease for Black Americans since the Great Depression. Overall, Hispanic Americans still have the longest life expectancy among tracked groups (78.8 years), followed by white Americans (77.6 years), and Black Americans (71.8 years). The gender gap for life expectancy also increased last year, with life expectancy falling for men by two years (to 74.5 years) but only one year for women (to 80.2 years).
 
The full report is available here.

Congressional Hearings

Tuesday, July 27th:

  • At 10am, the Senate Committee on Health, Education, Labor, and Pensions (HELP) will hold a hearing entitled “The Path Forward: Building on Lessons Learned from the COVID-19 Pandemic.” More information is available here. 
  • At 10am, the House Veterans’ Affairs Subcommittee on Health will hold a hearing entitled “Aging in Place: Examining Veterans’ Access to Home and Community Based Services.” More information is available here. 

Thursday, July 29th:

  • At 11am, the House Committee on Transportation and Infrastructure will hold a hearing entitled “Assessing the Federal Government’s COVID-19 Relief and Response Efforts and its Impact.” More information is available here. 

New York State Updates

Governor Cuomo Signs Legislation on Adult Social Day Services and DOH Outreach and Education Programs
On July 16th, Governor Cuomo signed legislation (S6526/A7499) that amends the State Office of the Aging (SOFA) definition of social adult day care (SADC) services to include community or home settings. The legislative memo states that although SOFA-funded SADC services were traditionally provided in congregate setting, the COVID-19 pandemic has highlighted the importance of allowing SADC to be delivered in an individual’s community or home setting pursuant to their person-centered service plan. Although SOFA provides funding for some SADC programs, it does not license or certify SADC programs in New York in general, and this definition does not affect non-SOFA-funded programs.
 
The Governor also signed the following bills related to the New York State Department of Health (DOH) outreach and education programs: 

  • S6957/A5979 includes reproductive health conditions that affect female fertility as part of the health care and wellness education and outreach program.
  • S3209/A182 allows for health care and wellness education and outreach on the donation of postnatal tissue and fluids.
  • S3474/A6531 allows for education and outreach programs on preeclampsia for consumers, patients, educators, and health care providers.

UHF Releases 2021 Medicaid Conference Recording
This week, the United Hospital Fund (UHF) released the recording (available here) of their 2021 Medicaid Conference entitled “Medicaid in New York: Centering Communities Post-COVID.” The conference, which took place on July 15th, including a keynote address from Brett Friedman, Director of Strategic Initiatives and Special Medicaid Counsel at DOH, on the “State of the State of New York Medicaid.” The conference also included panels and fireside chats on Medicaid’s role in providing care to individuals experiencing homelessness, the future of Medicaid, and addressing community needs through Medicaid.
 
Additional details and the conference agenda are available here.
 
DFS Issues Guidance on Disaster Emergency Planning for Regulated Insurers
On July 19th, the New York State Department of Financial Services (DFS) issued a circular letter (available here) to regulated insurance plans, including health insurance plans, to assist with planning, preparedness, and response to disasters (including pandemics). The letter provides guidance regarding disaster planning requirements for insurance companies both before and after a disaster strikes, including those related to business continuity and disaster response plans.
 
Questions may be submitted to disasterplanning@dfs.ny.gov.
 
OIG Says New York Improperly Claims $439 Million for School-Based Medicaid Services
On July 20th, the HHS Office of the Inspector General (OIG) released a report which found that New York State improperly claimed $439 million in federal Medicaid funds related to certified public expenditures (CPEs) on school-based health services outside New York City. This figure represents the entire amount claimed on such services from October 2011 to June 2016.
 
OIG said that New York used “complex methods that were difficult or impossible to correctly implement and support with documentation” to calculate an estimate of its CPEs on such services. New York generally disagreed with OIG’s recommendations but agreed to refund $1.2 million related to incorrectly offset costs, and also agreed that an additional $19.6 million had been claimed in error.
 
The full report is available here. The OIG summary is available here.
 
NYS Opens Applications for Public Health Corps Fellowship Program
On July 16th, Governor Cuomo announced that applications are now open for the New York State Public Health Corps Fellowship Program. This program will assist with immediate COVID-19 response and vaccination efforts, with the goal of strengthening local and statewide workforce capacities to respond to future public health emergencies. The program will provide up to 1,000 full-time, paid positions with placements in the New York State Department of Health, local health departments (except for New York City), and other public health partners statewide. Candidates include recent graduates and students in advanced clinical or public health studies.
 
Applications will be accepted on a rolling basis. Additional information and a link to the application are available here.