May 13th Newsletter

May 13, 2020

State Updates

New York State Submits Request for COVID-19 Emergency 1115 Waiver

On May 12th, New York State published the text of a proposed Section 1115(a) waiver request it has submitted to the Centers for Medicare and Medicaid Services (CMS) to address immediate needs resulting from the COVID-19 pandemic. NYS is requesting $2.75 billion in federal funding to support the following three investments:

  • Emergency Capacity Assurance Fund ($1.2 billion): The State would provide direct funding to providers affected by COVID-19 who supply “necessary capacity for uninsured and Medicaid individuals” and who “face sustainability challenges.” These may include Article 28 hospitals and clinics, Article 16, 31, and 32 clinics, and nursing facilities. Funds would be transferred to other pools or expended by 60 days after the end of the public health emergency, or March 31, 2021 at latest.
  • Rapid Facility Conversion ($650 million): The State would support providers in identifying facilities appropriate for rapid conversion for triage, quarantine, treatment, or other emergency activities. Funds would be used for conversion costs, staffing, and necessary administrative activities.
  • Regional Coordination and Workforce Development ($900 million): The State would use these funds to convert New York’s existing Performing Provider Systems (PPSs), which were created under the Delivery System Reform Incentive Payment (DSRIP) Program, into regional coordination hubs for COVID-19 response. PPSs would deploy telehealth and other technologies, leverage promising practices identified through DSRIP to coordinate care, and identify workforce capacity and training needs among their community partners.

The State is also requesting the following regulatory flexibilities which would be effective through the end of the emergency and retroactive to March 1, 2020:

  • Authority to suspend contract and program standards, cost sharing, and reimbursement methodologies for State Plan services, 1915(c) waiver services, and demonstration services for both Medicaid managed care and Medicaid fee-for-service, without the need for State Plan Amendment (SPA) submission and public notice processes.
  • Approval to establish temporary hospital facilities for COVID-19 treatment and other inpatient or emergency treatment and to claim federal financial participation on the inpatient and outpatient emergency department services delivered at those facilities. 
  • Waiving of the Institution of Mental Disease (IMD) exclusion, so that the State could use waiver funds to reimburse IMDs (including facilities that became IMDs due to emergency capacity expansion) for services provided to individuals under 65 years of age. This would also extend to situations where hospitals repurpose psychiatric beds in response to COVID-19 and deliver IMD care in appropriate psychiatric settings.

In addition to the Regional Coordination and Workforce Development funding request, the State is requesting a 12-month extension of the current MRT 1115 Waiver (currently set to expire on March 31, 2021) to allow the State to review all programs and conduct the appropriate budget neutrality review and public notice process. The State also included a number of requests previously submitted through an 1135 emergency waiver application.

NYS intends next to submit a concept paper on how it will “build the delivery system of the future” by leveraging lessons learned during the COVID-19 pandemic to better respond to future public health emergencies, while simultaneously addressing the State’s long-term goal of developing a comprehensive health care system based on value-based care. The concept paper will be submitted as part of the State’s broader request for renewal of the MRT 1115 Waiver.

The State’s application letter is available here. The full waiver application is available here.

Governor Cuomo Announces Essential Worker Antibody Testing Results, Calls for Financial Relief

Today (May 13th), Governor Cuomo held a press conference during which he announced additional results from the State’s antibody testing of downstate essential workers. In general, essential workers tested positive for antibodies at a lower rate than the general population (19.9% in NYC), as follows:

  • Transit workers (14.2%)
  • Health care workers (12.2%) 
  • NYPD (10.5%)
  • FDNY/EMT (17.1%)

The State also tested 2,750 New York State police members and 3,000 Department of Corrections and Community Supervision members, and found 3.1% and 7.5% tested positive for antibodies, respectively (compared to 12.3% in the New York State general population). The Governor also announced that facilities in 12 additional counties are now eligible to resume elective surgeries and ambulatory services, (Albany, Cayuga, Chemung, Columbia, Clinton, Cortland, Montgomery, Orange, Otsego, Rensselaer, Schenectady, and Warren Counties). 

The Governor reiterated his calls for the federal government to provide financial relief for state and local governments and additional federal funding for testing, tracing, and public infrastructure as an economic stimulus. He also announced that New York’s congressional delegation will introduce his proposed “Americans First Law,” which would require corporations to maintain the same number of employees that they had before the COVID-19 pandemic as a condition of receiving government funding.

SAMHSA COVID-19 Emergency Response for Suicide Prevention Grants

On May 12th, the Substance Abuse and Mental Health Services Administration (SAMHSA) released a Funding Opportunity Announcement (FOA) for COVID-19 Emergency Response for Suicide Prevention grants. These grants will provide $40 million in total funding to support states and communities during the COVID-19 pandemic in advancing efforts to prevent suicide and suicide attempts among adults age 25 and older.

Eligible applicants for funding include state government agencies, community-based primary care or behavioral health care organizations, public health agencies, community-based service providers, and emergency departments. SAMHSA anticipates awarding up to 50 entities with up to $800,000 over 16 months. A minimum of 25% of direct services funding must be used to support domestic violence victims. Awarded applicants will be expected to develop follow-up plans and care transition protocols for individuals who have attempted suicide after discharge, provide or assure provision of suicide prevention training to community and clinical service providers, and provide suicide screening/assessment and the appropriate clinical treatment services, including telehealth options during the current pandemic. 

The full FOA is available here. Applicants are due on May 22nd.

National Updates

House Democrats Release $3 Trillion COVID-19 Response Plan

On May 12th, House Democrats released the text of a proposed bill for a “fourth round” of COVID-19-related relief, with a proposed total spending of $3 trillion. Major provisions of this proposal, called the “Health and Economic Recovery Omnibus Emergency Solutions Act,” or HEROES Act, would:

  • Provide states and local governments with aid of nearly $1 trillion, including:
  • $540 billion for states, territories, and tribes and
  • $375 billion for localities;
  • Add $100 billion to the Provider Relief Fund to reimburse healthcare related expenses or lost revenue attributable to COVID-19;
  • Providers receiving these funds would be required to submit quarterly documentation of their COVID-19-related expenses and lost revenue compared with the prior year, and HHS would reimburse 100% of expenses and 60% of lost revenue. If a provider’s revenue decreased by less than 10%, they would not be eligible for payments. These guardrails would also apply to the remainder of the $175 billion provider funding pool appropriated by the CARES Act, and the bill would prohibit providers from double-dipping into more than one funding stream.
  • Provide an additional $75 billion to support testing and contact tracing;
  • Disburse another round of $1,200 in direct payments to Americans;
  • Amend PPP funding to make all nonprofits eligible regardless of number of employees and to set aside certain funding specifically for nonprofits, including specifically for those with fewer than 500 employees;
  • Modify the 6.2% increase in the standard federal medical assistance percentage (FMAP) for states (which was implemented in the second COVID-19 relief bill) to a 14% increase for the period July 1st through June 30, 2021;
  • Delay repayment of loans associated with Medicare Accelerated and Advanced payments by one year and the final full repayment deadline by two years, and limit recoupment to 25% of Medicare claims;
  • Create a special enrollment period for the federal health exchange; and,
  • Fully fund private employer insurance premiums for laid-off or furloughed workers between March and next January.

The House plans to vote on the bill on Friday. However, Senate Majority Leader Mitch McConnell stated that he intends to “hit pause” on further relief funding, and the Senate is not expected to take up this proposal in the near term. The proposed text of the HEROES Act is available here.

FAIR Health Releases Study on the Initial Impact of COVID-19 on Hospitals and Health Systems

On May 12th, FAIR Health released a study on the impact of COVID-19 on health systems around the United States for privately insured patients. The study compares allowed amounts on private insurance claims submitted in the first quarter of 2019 with those submitted during the first quarter of 2020. Expenses in the northeastern United States, the hardest-hit region, were highlighted. Major findings included:

  • There was an association between larger facility size and greater impact from COVID-19.
  • In March, the decrease in average per-facility private claims revenue was 16% nationally and 26% in the Northeast. In contrast, both discharges and revenues were generally higher in January and February than in the same months of 2019. 
  • Discharges in the third and fourth weeks of March at large northeastern hospitals fell by approximately 40% compared to 2019. These same hospitals had 8% higher discharge rates in January 2020 than in January 2019.
  • During the third and fourth weeks of March 2020, diseases and disorders of the respiratory system rose in share by volume and dollars in the inpatient setting, with the share of inpatient revenue increasing from 9% to 22%.

The study is available here.