Weekly Health Care Policy Update – August 20, 2021

August 27, 2021

In this update: 

  • Administration
    • Biden Administration Announces Updates on COVID-19 Response 
      • CMS Mandates Nursing Home Staff Vaccination
      • HHS Recommends Booster Shots for All
      • Administration Extends FEMA Reimbursement Deadline
  • Regulatory
    • CMS Offers States Extension of Deadline to Confirm Medicaid Enrollee Eligibility
    • USDA Opens Applications for Rural Health Care Grant
    • HHS Announces $19 Million in Telehealth Funding
    • CMS Releases Bulletin on Display of QHP Quality Rating Information on Exchanges
  • Other
    • Kaiser Foundation Report Says MA Spending Increased Faster than Medicare FFS
    • HHS OIG Issues Report on Medicare Payments to New Hospitals for Capital Costs
  • Congressional Hearings
  • New York State
    • NYS Mandates COVID-19 Vaccination for Hospital and LTC Facility Workers, Authorizes Third Dose for Immunocompromised
    • DFS Announces 2022 Health Insurance Premium Rates
    • OMH Releases Proposed Regulations for Crisis Stabilization Centers
    • NYS Comptroller Releases Audit Reports of the State’s Medicaid Program

COVID-19 Updates

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

  • CMS Mandates Nursing Home Staff Vaccination: On August 18th, the Centers for Medicare and Medicaid Services (CMS), in collaboration with the Centers for Disease Control and Prevention (CDC), announced the development of an emergency regulation requiring staff vaccinations in more than 15,000 Medicare and Medicaid-participating nursing homes. As of August 8th, CMS estimates that about 62% of nursing home staff are vaccinated. CMS will go through its necessary rule-making process over the next several weeks, issuing a rule in September, and encourages nursing home residents, staff, and operators to pursue vaccination in the interim.
  • HHS Recommends Booster Shots for All: On August 18th, the Department of Health and Human Services (HHS) released a statement on the Administration’s plan for booster shots of the Pfizer and Moderna mRNA-based COVID-19 vaccines. HHS plans to begin offering booster shots to Americans beginning the week of September 20th, starting 8 months after an individual’s second dose. The process will be contingent on the Food and Drug Administration’s (FDA) independent evaluation of safety and effectiveness and the recommendations of the CDC’s Advisory Committee on Immunization Practices (ACIP). HHS leadership also anticipates recommending booster shots for Johnson & Johnson vaccine recipients, but is still awaiting further data.
  • Administration Extends FEMA Reimbursement Deadline: On August 17th, President Biden issued a memorandum to the Federal Emergency Management Agency (FEMA) directing it to continue to provide 100 percent cost sharing to states for eligible COVID-19 emergency response costs from January 20, 2020 through December 31, 2021 This extends the previous deadline from September 30th by three additional months.

Regulatory Updates

CMS Offers States Extension of Deadline to Confirm Medicaid Enrollee Eligibility
On August 13th, the Centers for Medicare & Medicaid Services’ (CMS) Center for Medicaid & CHIP Services sent a letter to all State Health Officials outlining policy changes to help states address “the larger volume of pending eligibility and enrollment actions they will need to take after the Public Health Emergency (PHE) ends and minimize beneficiary burden.” The Families First Coronavirus Response Act (FFCRA) offered states enhanced matching funds, conditional on requirements including prohibiting states from disenrolling beneficiaries regardless of eligibility changes, but this provision terminates at the end of the PHE.
 
The letter revises guidance in two key areas: (1) It extends the timeframe for states to complete pending eligibility and enrollment actions to up to 12 months after the month in which the PHE ends; and (2) It prohibits states from terminating coverage for any individual determined ineligible for Medicaid (but not terminated during the PHE) until the state has completed a redetermination after the PHE ends. The letter does not signal the end of the PHE, which is still expected to continue through the end of 2021.
 
The full letter is available here.
 
USDA Opens Applications for Rural Health Care Grant 
On August 13th, the Department of Agriculture announced the availability of $500 million in federal grants through the Emergency Rural Health Care program, funded by the American Rescue Plan (ARP). Through this program, the Department will issue grants to rural health care providers to improve access to COVID-19 vaccines and tests, medical supplies, telehealth, food, and to cover lost revenue or staffing expenses. Eligible applicants include public entities and community-based not-for-profits. Funds will be available through two tracks:

  • Recovery Grants: The Department will award up to $350 million in to help providers recover from and respond to COVID-19 through activities such as vaccine distribution, increasing medical surge capacity or telehealth capabilities, constructing facilities to provide health care, or supporting food banks. Awards will range from $25,000 to $1 million, funding up to 75 percent of eligible project costs.
  • Impact Grants: The Department will award up to $125 million to be used in relation to the COVID-19 pandemic to create new models to solve regional rural health problems and improve the long-term sustainability of rural health care. Examples of projects include integration of behavioral health care or expanding access to telehealth. Awards will range from $5 million to $10 million, funding up to 75 percent of eligible projects costs.

More details are available on the program website here. A program webinar will be held at 2pm on August 25t. Registration is available here.

HHS Announces $19 Million in Telehealth Funding
On August 18th, HHS announced more than $19 million in funding for 36 award recipients to support and expand access to telehealth services in rural and underserved communities. The funding is being made available through four programs in the Health Resources and Services Administration (HRSA) Office for the Advancement of Telehealth. These are:

  • Telehealth Centers of Excellence 
    • Two public academic medical centers with significant experience in telehealth, funded to assess specific uses of telehealth to rural areas.
  • Telehealth Resource Centers 
    • 12 regional and two national centers offering provider training, support, education and partnership promotion.
  • The Telehealth Technology-Enabled Learning Program 
    • Nine awardees for a program to connect specialists at academic medical centers with primary care providers in rural and underserved areas.
  • The Evidence-based Direct to Consumer Telehealth Network Program 
    • 11 organizations that will provide direct-to-consumer telehealth services to patients within established telehealth networks.  

A list of award recipients is available here.

CMS Releases Bulletin on Display of QHP Quality Rating Information on Exchanges
On August 18th, CMS released a bulletin to provide guidance on requirements for exchanges to publicly display quality rating for Qualified Health Plans (QHPs) on the individual market. All exchanges, including state-run exchanges and Direct Enrollment entities, will be required to follow these requirements during plan year 2022. Specifically, CMS is ending enforcement discretion for DE entities, which previously were not required to display quality information for plans. The guidance covers topics such as display of QHP star ratings and how to handle plans that did not receive a 2021 rating.
 
The bulletin is available here.

Other Updates

Kaiser Foundation Report Says MA Spending Increased Faster than Medicare FFS
On August 17th, the Kaiser Family Foundation (KFF) released a report finding that Medicare Advantage (MA) spending is both higher and continuing to increase faster than spending in the Original Medicare fee-for-service (FFS) program. KFF found that Medicare spending per person for beneficiaries in MA was $321 higher per person in 2019 than it would have been if enrollees had instead been covered by Medicare FFS, resulting in an additional $7 billion in spending.
 
Medicare Advantage growth is expected to increase from $348 billion in 2021 to $664 billion in 2029. KFF projects that half of this growth will represent growth in spending per enrollee, after inflation, at 5.3 percent per year on average, while the remainder is accounted for by enrollment growth. Medicare FFS spending growth is projected to be 4.4 percent per year. If MA spending grew at the Medicare FFS rate, spending would be $189 billion lower over this period.
 
The KFF report is available here.
 
HHS OIG Issues Report on Medicare Payments to New Hospitals for Capital Costs
On August 13th, the HHS Office of Inspector General (OIG) published a report examining Medicare capital cost payments to new hospitals. In general, Medicare pays hospitals for capital costs through the Inpatient Prospective Payment System (IPPS), but new hospitals are instead paid on a cost reimbursement basis for their first two years of operation, given the potential for inadequate Medicare utilization in their initial years.
 
In this report, OIG looked at 112 new hospitals, and identified a total of $283 million in capital costs above what the facilities would have been paid through the IPPS methodology. This total represents three times more, on average, than what the facilities would have been paid under the IPPS. OIG recommended that CMS review the findings and consider changing the regulations to require new hospitals to have Medicare capital costs paid through the IPPS, with an option for payment adjustments or supplemental payments if necessary. CMS concurred with the recommendation and stated that it would consider it in future rulemaking.
 
The OIG report is available here.

Congressional Hearings

Monday, August 23rd: 

  • At 11am, the House Rules Committee will hold a meeting to consider the budget resolution for fiscal year (FY) 2022, the Infrastructure Investment and Jobs Act, and the John R. Lewis Voting Rights Advancement Act of 2021. More information is available here.

New York State Updates

NYS Announces COVID-19 Vaccination Mandate for Healthcare Workers, Authorizes Third COVID-19 Vaccine Dose for Immunocompromised 
On August 16th, Governor Cuomo issued an announcement that health care workers in New York State, including staff at hospitals and long-term care facilities, will be required to be vaccinated against COVID-19. Covered workers will need to receive a first dose by September 27th.
 
On August 19th, the Department of Health (DOH) issued a conforming order under Section 16 of the Public Health Law, which permits DOH to take “summary action” to address “danger to the health of the people.” The order requires all hospital and long-term care facilities (including nursing homes, adult care facilities, and other congregate care settings) to develop and implement a policy mandating employee vaccinations, with limited exceptions for those with religious or medical reasons.
 
Governor Cuomo also announced that, in accordance with CDC recommendations, DOH has authorized a third COVID-19 vaccine dose for New Yorkers with compromised immune systems. Eligible New Yorkers can receive their third dose 28 days after the completion of their two-dose vaccination series, including those who have: 

  • Been receiving active cancer treatment for tumors or cancers of the blood;
  • Received an organ transplant and are taking medications to suppress the immune system;
  • Received a stem cell transplant within the last two years or are taking medicine to suppress the immune system;
  • Moderate or severe primary immunodeficiency;
  • Advanced or untreated HIV infection;
  • Active treatment with high-dose corticosteroids, cancer chemotherapy that causes severe immunosuppression, or other medications that suppress the immune response.

The Governor’s press release is available here.
 
DFS Announces 2022 Health Insurance Premium Rates
On August 13th, the New York State Department of Financial (DFS) announced the 2022 health insurance premium rates for the individual and small group markets. Insurance plans requested an average increase of 11.2 percent in the individual market and 14 percent in the small group market, which DFS reduced to 3.7 percent and 7.6 percent, respectively. Approximately 264,000 New Yorkers are currently enrolled in individual commercial plans and almost 900,000 New Yorkers are enrolled in small group plans that cover employers with up to 100 employees.
 
The DFS press release, which includes individual and small group market rate actions by plan, is available here.
 
OMH Releases Proposed Regulations for Crisis Stabilization Centers
On August 18th, the New York State Office of Mental Health (OMH) published a proposed rule in the State Register (available here) that establishes standards for Crisis Stabilization Centers under Article 36 of the Mental Hygiene Law. Crisis Stabilization Centers are a new licensure category authorized by the fiscal year 2021-2022 enacted New York State Budget that will provide 24/7 stabilization services to individuals experiencing or at risk of a mental health or substance use crisis.
 
The proposed rule defines two types of Crisis Stabilization Centers that will be licensed (Supportive and Intensive), outlines the staffing model and governing body requirements, and explains the application and approval process. Eligible applicants are entities currently in possession of an Article 31, Article 32, or Article 28 license.
 
OMH will accept public comment on the proposed regulations through October 17th. SPG will shortly release a more detailed summary of the proposed regulations.
 
NYS Comptroller Releases Audit Reports of the State’s Medicaid Program
On August 17th, the Office of the New York State Comptroller released findings from three audits of the New York State Medicaid program: 

  • The first audit (available here) found that eMedNY, the Medicaid claims processing and payment system, improperly allowed payments for claims that did not contain an appropriate National Provider Identifier (NPI) in the ordering, prescribing, referring, and attending (OPRA) fields. This resulted in improper Medicaid payments, including $1.5 billion in payments that did not have an appropriate referring or attending NPI.
  • The second audit (available here) found that some Medicaid fee-for-service inpatient claims were incorrectly coded as hospital discharges when the patients were actually transferred to another facility, resulting in Medicaid overpayments.
  • The third audit (available here) is a follow-up report to an initial audit released in July 2019, which identified over $102.1 million in improper Medicaid managed care premium payments for recipients with duplicate Client Identification Numbers (CINs). The follow-up report found that DOH made significant progress in addressing the problems identified in the initial report, including enhancing certain controls to prevent the duplication of CINs and recovering nearly $51 million, but that additional action is necessary to prevent future improper payments.