Author Archives: henrykotula

Tower Health takes financial hit from COVID-19, Epic install costs

Posted on by • Posted in Cash, Cash Reserves, Economic Stimulus, Elective Procedures, Elective Surgery, Electronic Health Record (EHR), Employee Furlough, Employee Hiring Freeze, Employee Layoffs, Employee Pay Cuts, Financially Distressed, Health System, Hospital, Net Income, Nonoperating Income, Operating Expenses, Operating Income, Operating Margin, Operating Performance, Operating Revenue • Leave a comment

https://www.beckershospitalreview.com/finance/tower-health-takes-financial-hit-from-covid-19-epic-install-costs.html?utm_medium=email

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Tower Health reported higher revenue in the nine months ended March 31, but the West Reading, Pa.-based health system ended the period with an operating loss, according to recently released unaudited financial documents.

The health system reported revenue of $1.6 billion in the first three quarters of fiscal year 2020, up 13.8 percent from $1.4 billion a year earlier. Higher expenses and reductions in patient volume in the most recent quarter due to the COVID-19 pandemic hindered further revenue growth.

Tower Health said expenses climbed 19.2 percent year over year to $1.7 billion in the nine months ended March 31. In the first three quarters of fiscal 2020, the health system recorded $27.1 million in one-time expenses — $7 million related to Epic implementation costs at newly acquired hospitals, and the remainder was related to other one-time transaction costs.

The health system said it had 102 days cash on hand as of March 31, down 52 days from a year earlier. The decrease was primarily due to Epic implementation costs and integration expenses, Tower said.

The health system said it has made significant revenue cycle improvements and expects progress to continue.

“During the COVID-19 crisis revenue cycle management is aggressively pursuing advanced payments and outstanding claim resolution from all major commercial payors as well as ensuring capture of additional reimbursement for services such as telemedicine,” Tower said.

The health system ended the first three quarters of fiscal 2020 with an operating loss of $131.9 million, compared to an operating loss of $48.5 million in the same period a year earlier. 

After factoring in nonoperating losses, Tower Health recorded a net loss of $153.9 million in the first three quarters of fiscal 2020. In the same period a year earlier, it reported a net loss of $29.3 million. 

To offset financial damage from COVID-19, Tower Health has furloughed about 1,000 employees and received $166 million in advance Medicare payments, which must be repaid. The health system also received $66 million in grants under the Coronavirus Aid, Relief and Economic Security Act.

 

Prospect Medical Group to add 10,000 physicians with 3 acquisitions

Posted on by • Posted in Market Consolidation, Market Power, Medical Group, Mergers & Acquisitions, Physician Independent Network (IPA) • Leave a comment

https://www.beckershospitalreview.com/hospital-transactions-and-valuation/prospect-medical-group-to-add-10-000-physicians-with-3-acquisitions.html?utm_medium=email

Prospect Medical Group to acquire three physician practices

Prospect Medical Group will double in size when it completes the acquisition of three medical practices later this year. 

Prospect Medical Group, owned by Los Angeles-based Prospect Medical Holdings, entered into an agreement April 22 to acquire certain assets of CalCare IPA and Los Angeles Medical Center IPA, both of which serve Los Angeles County, and Vantage Medical Group in San Diego, San Bernardino and Riverside, Calif.

The transaction, which is subject to customary closing conditions and approvals from contracted health plans, is expected to close this summer. 

The three independent medical associations, representing more than 10,000 physicians, will join Prospect’s existing network of about 10,000 providers when the transaction closes.

“This is a great opportunity to expand Prospect’s system of coordinated care to a much larger market,” said Prospect Medical Systems CEO Jim Brown. “Our vision is that everyone has access to quality health care when they need it, and we look forward to partnering with a new network of physicians to make that a reality.”

 

 

 

 

Michigan Medicine accused of exploiting 1,300 resident physicians in labor dispute

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https://www.beckershospitalreview.com/hr/michigan-medicine-accused-of-exploiting-1-300-resident-physicians-in-labor-dispute.html?utm_medium=email

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The union that represents 1,300 resident physicians at Ann Arbor-based Michigan Medicine said the health system is exploiting its members as both sides negotiate a new contract, according to Michigan Radio.

The University of Michigan House Officers Association and Michigan Medicine are trying to reach an agreement before the current contract expires in late June. But compensation remains a key sticking point.

Ruth Bickett-Hickok, MD, a second-year anesthesiology resident, told reporters May 18 she’s been treating COVID-19 patients and seeks a cost-of-living raise, according to Michigan Radio.

“Frankly I’m here because, for lack of a better term, Michigan [Medicine] residents right now are being exploited for their labor. Especially during this crisis,” said Dr. Bickett-Hickok, who is on the union board. She also cited her debt load for undergraduate and medical school in her reasoning for seeking a cost-of-living raise.

Overall, the union says it wants fair wages that recognize the risks physician residents have been willing to take on during the pandemic.

In a statement provided to Becker’s Hospital Review, Michigan Medicine spokesperson Mary Masson said the health system “recognizes the important role of the [union] members” and amid the pandemic “has honored the compensation package previously proposed to the HOA, which includes salary increases.”

Ms. Masson said Michigan Medicine is undergoing a $400 million expense reduction plan with furloughs and layoffs affecting about 1,400 full-time employees. Physician residents’ salaries range from $58,500 to $82,900 annually based on experience. Ms. Masson said to provide even higher salary increases, Michigan Medicine would have to eliminate additional jobs.

The union proposes that the health system use part of the university’s endowment funds to help cover the new labor deal.

 

 

 

New Coronavirus Vaccine Candidate Shows Promise In Early, Limited Trial

Posted on by • Posted in Clinical Research, Clinical Trials, Coronavirus, Food and Drug Administration (FDA), Pandemic, Vaccination, Vaccine, Vaccine RNA • Leave a comment

https://www.npr.org/sections/coronavirus-live-updates/2020/05/18/857997341/new-coronavirus-vaccine-candidate-shows-promise-in-early-limited-trial

Moderna's coronavirus vaccine shows promise in first human trial ...

A vaccine manufacturer is reporting preliminary data suggesting its COVID-19 vaccine is safe, and appears to be eliciting in test subjects the kind of immune response capable of preventing disease.

Moderna, Inc., of Cambridge, Mass., developed the vaccine in collaboration with the National Institute of Allergy and Infectious Diseases. The results reported Monday come from an initial analysis of a Phase I study primarily designed to see if the vaccine is safe.

The company reports no serious side-effects; however, modest side-effects included redness at the injection site, headache, fever and flu-like symptoms, although none of these lasted more than a day.

The first 45 volunteers for the vaccine trial were divided into three groups, with each group getting a different dose of the vaccine. All groups got an initial shot, followed by a booster shot a month later.

In addition to safety, the company also looked at the vaccine’s ability to induce antibodies to the coronavirus — what’s known as its immunogenicity. It did, for all subjects at all dose levels. In addition, eight of the subjects were tested for the presence of neutralizing antibodies that prevent the virus from infecting cells in the laboratory. All eight did.

The Food and Drug Administration has given Moderna the green light to begin a Phase II study expected to enroll an additional 600 volunteers — half older than 55 — to provide additional immunogenicity data. The company hopes by July to begin a Phase III study, aimed at showing that the vaccine can actually prevent disease.

The Moderna vaccine is made using messenger RNA, or mRNA, a molecule containing the genetic instructions to make a protein on the coronavirus surface that is recognized by our immune systems. Although mRNA vaccines have been studied for several years, so far none has been licensed by the FDA.

The advantage of mRNA vaccines over more traditional vaccines is they can be made quickly. The company says it was just 63 days from the time Chinese scientists revealed the genetic sequence to the time a vaccine was injected into the first volunteer.

Moderna’s is one of about a dozen COVID-19 vaccine candidates that have begun studies in humans.

 

 

 

Medicaid Providers At The End Of The Line For Federal COVID Funding

Posted on by • Posted in 2020 Election Issues, Dept of Health and Human Services (HHS), Employee Furlough, Employee Hiring Freeze, Employee Layoffs, Employee Pay Cuts, Health Policy, Medicaid, Medicaid Childrens Health Insurance Program (CHIP), Medicaid Expansion, Personal Protective Equipment (PPE), Safety Net Hospitals, Safety-Net Providers • Leave a comment

https://khn.org/news/medicaid-providers-at-the-end-of-the-line-for-federal-covid-funding/

Medicaid Providers At The End Of The Line For Federal COVID ...

Casa de Salud, a nonprofit clinic in Albuquerque, New Mexico, provides primary medical care, opioid addiction services and non-Western therapies, including acupuncture and reiki, to a largely low-income population.

And, like so many other health care providers that serve as a safety net, its revenue — and its future — are threatened by the COVID-19 epidemic.

“I’ve been working for the past six weeks to figure out how to keep the doors open,” said the clinic’s executive director, Dr. Anjali Taneja. “We’ve seen probably an 80% drop in patient care, which has completely impacted our bottom line.”

In March, Congress authorized $100 billion for health care providers, both to compensate them for the extra costs associated with caring for patients with COVID-19 and for the revenue that’s not coming in from regular care. They have been required to stop providing most nonemergency services, and many patients are afraid to visit health care facilities.

But more than half that money has been allocated by the Department of Health and Human Services, and the majority of it so far has gone to hospitals, doctors and other facilities that serve Medicare patients. Officials said at the time that was an efficient way to get the money beginning to move to many providers. That, however, leaves out a large swath of the health system infrastructure that serves the low-income Medicaid population and children. Casa de Salud, for example, accepts Medicaid but not Medicare.

State Medicaid directors say that without immediate funding, many of the health facilities that serve Medicaid patients could close permanently. More than a month ago, bipartisan Medicaid chiefs wrote the federal government asking for immediate authority to make “retainer” payments — not related to specific care for patients — to keep their health providers in business.

“If we wait, core components of the Medicaid delivery system could fail during, or soon after, this pandemic,” wrote the National Association of Medicaid Directors.

So far, the Trump administration has not responded, although in early April it said it was “working rapidly on additional targeted distributions” for other providers, including those who predominately serve Medicaid patients.

In an email, the Centers for Medicare & Medicaid Services said officials there will “continue to work with states as they seek to ensure continued access to care for Medicaid beneficiaries through and beyond the public health emergency.”

CMS noted that states have several ways of boosting payments for Medicaid providers, but did not directly answer the question about the retainer payments that states are seeking the authority to make. Nor did it say when the funds would start to flow to Medicaid providers who do not also get funding from Medicare.

The delay is frustrating Medicaid advocates.

“This needs to be addressed urgently,” said Joan Alker, executive director of Georgetown University’s Center for Children and Families in Washington, D.C. “We are concerned about the infrastructure and how quickly it could evaporate.”

In the administration’s explanation of how it is distributing the relief funds, Medicaid providers are included in a catchall category at the very bottom of the list, under the heading “additional allocations.”

“To not see anything substantive coming from the federal level just adds insult to injury,” said Todd Goodwin.

He runs the John F. Murphy Homes in Auburn, Maine, which provides residential and day services to hundreds of children and adults with developmental and intellectual disabilities. He said his organization — which has already furloughed almost 300 workers and spent more than $200,000 on COVID-related expenses including purchases of essential equipment such as masks and protective equipment that will not be reimbursable — has not been eligible for any of the various aid programs passed by Congress. It gets most of its funding from Medicaid and public school systems.

The organization has tapped a line of credit to stay afloat. “But if we’re not here providing these services, there’s no Plan B,” he said.

Even providers who largely serve privately insured patients are facing financial distress. Dr. Sandy Chung is CEO of Trusted Doctors, which has about 50 physicians in 13 offices in the Northern Virginia suburbs around Washington, D.C. She said about 15% of its funding comes from Medicaid, but the drop off in private and Medicaid patients has left the group “really struggling.”

“We’ve had to furlough staff, had to curtail hours, and we may have to close some locations,” she said.

Of special concern are children because Medicaid covers nearly 40% of them across the county. Chung, who also heads the Virginia chapter of the American Academy of Pediatrics, said that vaccination rates are off 30% for infants and 75% for adolescents, putting them and others at risk for preventable illnesses.

The biggest rub, she added, is that with the economy in free fall, more people will qualify for Medicaid coverage in the coming weeks and months.

“But if you don’t have providers around anymore, then you will have a significant mismatch,” she said.

Back in Albuquerque, Taneja is working to find whatever sources of funding she can to keep the clinic open. She secured a federal loan to help cover her payroll for a couple of months, but worries what will happen after that. “It would kill me if we’ve survived 15 years in this health care system, just to not make it through COVID,” she said.

 

 

 

 

OSHA Probing Health Worker Deaths But Urges Inspectors To Spare The Penalties

Posted on by • Posted in 2020 Election Issues, Centers for Disease Control & Prevention (CDC), Employee Protections, Mortality, Occupational Safety and Health Administration (OSHA), Pandemic, Personal Protective Equipment (PPE), Public Health, Public Safety, Worker Protection, Worker Rights • Leave a comment

https://khn.org/news/osha-probing-health-worker-deaths-but-urges-inspectors-to-spare-the-penalties/

OSHA Probing Health Worker Deaths But Urges Inspectors To Spare ...

The Occupational Safety and Health Administration has in recent weeks launched investigations into deaths of workers at 34 health care employers across the U.S., federal records show, but former agency officials warn that the agency has already signaled it will only cite and fine the most flagrant violators.

The investigations come as health care workers have aired complaints on social media and to lawmakers about a lack of personal protective equipment, pressure to work while sick, and retaliation for voicing safety concerns as they have cared for more than 826,000 patients stricken by the coronavirus.

Despite those concerns, the nation’s top worker safety agency is not viewed as an advocate likely to rush to workers’ aid. President Donald Trump tapped a Labor Department leader who has represented corporations railing against the very agency he leads.

“It’s a worker safety crisis of monstrous proportions and OSHA is nowhere to be found,” said David Michaels, an epidemiologist and George Washington University professor who was assistant secretary of Labor and ran OSHA from 2009 to 2017.

Employers are required to report a work-related death to OSHA or face fines for failing to do so. Yet former OSHA leaders say the agency has not openly reminded hospitals and nursing homes to file such reports in recent weeks.

Last week, the Centers for Disease Control and Prevention reported that more than 9,200 health workers had been infected with the coronavirus, a number the agency concedes is a vast undercount. The estimate was based on a set of lab-generated reports in which only 16% included the patient’s profession. The agency said the true number is probably closer to 11% of all known cases.

Federal records show the OSHA fatality investigations ― searchable here — involve hospitals, an emergency medical service agency, a jail health department and nursing homes. Its investigations can be prompted by the complaint of a worker, a former worker or even an OSHA official who sees a news report about a workplace death. They can be conducted by phone and fax or involve an on-site inspection.

One fatality investigation launched April 7 focuses on Marion Regional Nursing home in Hamilton, Alabama, where nurse Rose Harrison, 60, worked before she died of COVID-19, her daughter Amanda Williams said.

Williams said her mother was not given a mask when caring for a patient on March 25 ― 10 days after the county’s first coronavirus case — who later tested positive for the virus. Williams said her mother felt pressured to keep going to work even as she was coughing, fatigued and running a low-grade fever.

“She kept telling me ‘Amanda, I have to work, I have to get my house paid off,’” Williams said, noting her mother said she was urged to work unless her temperature reached 100.4.

Williams said that she drove her mother to the hospital on April 3 and that Harrison was unhappy she’d spent the week working. Harrison went on a ventilator the following day, fully expecting to recover. She died April 6.

“When your mother dies mad, you’re pretty much mad,” Williams, one of Harrison’s three daughters, said. “I think if proper steps were taken from the beginning, this would have been different.”

North Mississippi Health Services, which owns the nursing home, and the home’s administrator did not reply to calls or emails.

An April 13 OSHA memo said the agency would prioritize death investigations involving health care workers and first responders. It said “formal complaints alleging unprotected exposures to COVID-19 … may warrant an on-site inspection.”

Michaels, the former Labor Department official, said a subsequent OSHA memo suggested that officials are unlikely to penalize all but the most careless employers.

The memo about employers’ “good faith” efforts said a citation may be issued “where the employer cannot demonstrate any efforts to comply.”

Michaels said that “any efforts” to comply with work safety rules could amount to making even one phone call to try to buy masks for workers.

Federal OSHA officials did not respond to a request for comment.

Democrats criticized Trump last year when he tapped Eugene Scalia, who spent years of his legal career defending major corporations, to head the Labor Department.

Scalia fought OSHA on behalf of SeaWorld after it was cited over the death of a woman training killer whales, The New York Times reported. Scalia’s team argued the work-safety agency was not meant to regulate the training of killer whales. He also argued that SeaWorld had adequate safety measures in place, but ultimately lost the case.

Sen. Bernie Sanders, alluding to Scalia’s record of defending firms like Chevron and Goldman Sachs, called the appointment “obscene.”

Since March 27, the ongoing fatality investigations have been mostly categorized as “partial” investigations, which initially focus on one area of noncompliance. Four are labeled “complete,” meaning they cover a wide range of hospital operations.

One of the “complete” investigations is listed at Coral Gables Hospital in South Florida, where respiratory therapist Jorge Mateo, 82, worked before he died of coronavirus complications, his daughter said.

The hospital reported the death, according to a statement from Shelly Weiss Friedberg of Tenet Healthcare, which owns the hospital. She said Mateo was with the hospital for four decades and “the loss of Jorge Mateo is felt throughout our entire community.”

A subsequent investigation — also labeled as “complete” ― was opened April 10 at Palmetto General Hospital, in South Florida.

There, 33-year-old Danielle Dicenso worked for a staffing agency as an ICU nurse, treating coronavirus patients. Dicenso died after developing COVID-19 symptoms, including fever and a cough, according to reports in the Miami Herald. The Palm Beach County medical examiner has not yet determined a cause of death, a spokesperson told Kaiser Health News.

Her husband, David Dicenso, told local news station WSVN she had not been given a protective mask and was “very scared of going to work.”

Weiss Friedberg, of Tenet, which also owns Palmetto, said in an email that “nurses are provided appropriate personal protective equipment (PPE) in compliance with Centers for Disease Control (CDC) guidelines.”

The latest guidelines say staff can wear a face mask if no N95 respirator is available when performing routine care with COVID-19 patients. For higher-risk procedures, such as intubation, workers must receive N95 masks.

OSHA opened an inspection at St. Catherine of Siena Medical Center, a Long Island hospital, on April 11. Federal officials had learned from a local news story about a patient care assistant dying of COVID-19, hospital leadership confirmed.

The hospital has no record of that employee having any interaction with COVID patients, said James O’Connor, its executive vice president. The hospital tests employees for COVID-19 only if they have had confirmed exposure to someone who tested positive and if they develop symptoms.

O’Connor said all employees who are in contact with suspected COVID-19 patients get the full suite of PPE; they are told to clean their N95 masks after each shift, he said, and to change masks entirely every three shifts.

That can mean workers wear the same equipment for multiple days.

Early research suggests that N95s can be sanitized and reused up to three times. But that paper has not yet undergone peer review. In an affidavit the New York State Nurses Association filed regarding another state hospital, the union argued that it has “yet to be adequately proven that disposable respirators can be effectively decontaminated” without putting the wearer at risk.

As recently as April 16, the local nurses union told Newsday that St. Catherine workers on Long Island are being told to share PPE.

While OSHA does have a “general duty” clause urging employers to keep workers safe and a standard for respiratory protection, it has no written rule on protecting workers from airborne disease, said Debbie Berkowitz, a former OSHA chief of staff and director of the National Employment Law Project’s worker safety and health program.

As OSHA and the Centers for Disease Control and Prevention downgrade their requirements week by week, workers are left with the choice in some places to wear a bandana in situations that had called for a properly fitted N95 mask, which can filter out particles as small as 0.1 microns.

“OSHA has really completely abandoned their mandate to protect workers,” Berkowitz said, “and every worker is on their own.”

 

 

 

 

Treasury Has Hardly Spent Its $500 Billion Coronavirus Relief Fund

Posted on by • Posted in 2020 Election Issues, Coronavirus, Crisis, Crisis Management, Dept of Treasury, Economic Crisis, Economic Stimulus, Employee Furlough, Employee Hiring Freeze, Employee Layoffs, Employee Pay Cuts, Employee Protections, Health Policy, Job, Job Market, Job Search, Job Security, The CARES Act, Unemployment, Unemployment Insurance • Leave a comment

https://www.thefiscaltimes.com/newsletter/20200518-500-Billion-Coronavirus-Fund-Has-Barely-Been-Used

Hard News Cafe » Blog Archive » Water-faucet-shutterstock-june-2011

The Treasury Department has disbursed just $37.5 billion out of $500 billion in emergency coronavirus funds approved by Congress as part of the CARES Act passed in March, according to the first report of the congressional oversight commission monitoring the implementation of the law.

Airlines still waiting on billions from relief fund: Congress allocated $46 billion for aid to the air travel industry, but the Treasury Department has yet to disburse any of the money. The funds include $25 billion for airlines and $17 billion for related businesses that are critical to national security.

Lending programs not yet lending: The Federal Reserve and Treasury last month announced five lending facilities meant to help prop up various segments of the economy, including “Main Street” lending programs targeting small- and mid-sized businesses, a program for states and municipalities, and a corporate-bond buying facility. Only one of those programs is fully up and running. Treasury disbursed $37.5 billion to the corporate facility, called the Secondary Market Corporate Credit Facility (SMCCF), earlier this month.

“The Treasury and the Fed have announced these facilities but, with the exception of the SMCCF, the Treasury has not invested in them yet, nor has the Fed put them into operation,” the oversight report says. “Their size and scope may also grow as the Treasury has only pledged $185 billion of the $454 billion appropriated in the CARES Act for investments in Fed lending facilities.”

Changes to lending terms: “The report describes how even before any money from the Main Street program has been lent, the terms of the program already have evolved,” The Washington Post’s Erica Werner reports. “The changes include increasing the size of loans, eliminating a requirement that companies have to attest they need money ‘due to the exigent circumstances presented by’ the coronavirus, and modifying a requirement that companies make ‘reasonable efforts’ to maintain payroll and retain employees during the term of a loan. Instead, they will be required to make ‘commercially reasonable efforts’ to do so.”

The Fed and Treasury also expanded the $35 billion facility to buy debt from states, cities and counties, after criticism that the original guidelines left only a few dozen cities and counties eligible to participate. The facility will now buy notes from counties with a population of at least 500,000 residents (instead of the original floor of 2 million residents) and cities with a population of at least 250,000 residents (instead of a million residents). The program will also buy notes that mature within at least three years instead of two years.

The bottom line: Congress may have moved with unusual speed to provide money to address the pandemic, but while the Treasury Department quickly implemented other elements of the CARES Act, the report highlights how the lending programs have gotten off to a slow start and how many questions remain to be answered about how they will function. Roughly a third of the new report is filled with questions for the Treasury Department and the Federal Reserve about the programs.

Similar questions still hang over the oversight commission and broader oversight of the trillions in new spending approved by Congress. The five-member commission still doesn’t have a chairman, as House Speaker Nancy Pelosi and Senate Majority Leader Mitch McConnell have yet to agree on a person to fill that post. The Senate also has yet to confirm a special inspector general to oversee the $500 billion Treasury fund.

The commission’s next report is reportedly due in mid-June.

 

States brace for ‘nearly certain’ Medicaid budget shortfalls amid COVID-19

Posted on by • Posted in 2020 Election Issues, ACA, Coronavirus, Crisis, Crisis Management, Employer-Based Health Insurance, Essential Health Benefits, Health Insurance Coverage Adequacy, Health Policy, Health System, Hospital, Hospital Industry, Medicaid, Medicaid Block Grants, Medicaid Childrens Health Insurance Program (CHIP), Medicaid Expansion, Out of Pocket Expenses, Pandemic, Preexisting Conditions, Uncompensated Care, Underinsured, Unemployment, Unemployment Insurance, Uninsured • Leave a comment

https://www.healthcaredive.com/news/states-brace-for-nearly-certain-medicaid-budget-shortfalls-amid-covid-19/578120/

Coronavirus updates: Virus reaches all 50 states, stock futures fall

Dive Brief:

  • Most states with budget projections expect Medicaid shortfalls due to rising spending as more people lose jobs and enroll into the safety net insurance for low-income Americans due to the COVID-19 pandemic, according to a new Kaiser Family Foundation survey.
  • Almost all states with enrollment projections and more than half with spending projections expect program growth to surpass pre-pandemic estimates. Nearly all states anticipate growth will accelerate even more in the 2021 fiscal year, KFF found. As a result of that growth, 17 of 19 states with budget projections report a shortfall is “nearly certain” or “likely” for the upcoming fiscal year.
  • The survey comes as Congress once again considers raising the federal match rate for Medicaid in the $3 trillion Health and Economic Recovery Omnibus Emergency Solutions Act, passed by the House of Representatives on Friday.​

Dive Insight:

Medicaid is often the top line spending item in state budgets, sending states scrambling for ways to reduce spend in the safety net health insurance program, including controversial block grants for funding.

At the start of the 2020 fiscal year, states anticipated modest Medicaid spending growth, and flat enrollment growth due to the strong economy. That forecast quickly shifted as the coronavirus spread in the U.S., which lost some 21 million jobs in April as businesses shutter their doors in compliance with stay-at-home orders, sending the unemployment rate to 15%.  

Because the U.S. generally couples coverage to employment, skyrocketing job loss could make an estimated 17 million people newly eligible for Medicaid and 6 million eligible for subsidies in the Affordable Care Act marketplaces by January 2021.

Medicaid officials from 38 states shared their budget projections with KFF for the survey. States that did not respond were still gathering data about the coronavirus or didn’t have updated enrollment or spending projections for the 2020 or 2021 fiscal years, KFF researchers Robin Rudowitz and Elizabeth Hinton said.

Thirty-two of 34 states with enrollment projections think enrollment will exceed initial projections in 2020, and 30 of 31 states anticipate that growth in 2021 will outpace the current fiscal year.

States are more mixed on spending projections. Over half of states with projections, 18 of 32, expect 2020 Medicaid spending to exceed pre-pandemic estimates. Eight states anticipate no change, and the remaining six project slightly lowered spending due to lower healthcare utilization as non-essential services have largely ground to a halt.

State Medicaid officials are more in lockstep when it comes to 2021 spending projections. Nearly all states with projections — 29 of 30 — think Medicaid spending rates in 2021 will increase over 2020.

Without greater support from the federal government, the survey hints states will face significant spending cuts for Medicaid for the upcoming fiscal year, which begins July 1 for most states. Multiple groups, including the National Governors Association and the National Association of State Medicaid Directors, have called for a higher federal match rate.

One of the first legislative packages designed to mitigate the fallout of COVID-19, the Families First Coronavirus Response Act passed March 18, authorized a 6.2 percentage point increase in the rate for Medicaid if states meet certain requirements. States can’t increase premiums or restrict eligibility standards and must cover COVID-19 testing and treatment without cost-sharing.

The HEROES Act passed by Democrats in the House on Friday would increase the match rate by 14 percentage points from July 1, 2020, through June 30, 2021, along with benchmarking an additional $100 billion for providers.

However, Senate Majority Leader Mitch McConnell, R-Ky., and President Donald Trump have said they’re in no rush to pass another round of legislation adding to the more than $3 trillion Congress has approved so far.

 

 

 

 

Jay Powell warns US recovery could take until end of 2021

Posted on by • Posted in 2020 Election Issues, Clinical Testing, Contact Tracing, Coronavirus, Credibility, Crisis, Crisis Management, Economic Crisis, Economic Recovery, Economic Stimulus, Economy Reopening, Employee Benefits, Employee Furlough, Employee Hiring Freeze, Employee Layoffs, Employee Pay Cuts, Employee Protections, Employer-Based Health Insurance, False Hope, Health Insurance Coverage Adequacy, Health Policy, Infection Control, Infection Control Plan, Job, Job Market, Job Search, Job Security, Pandemic, Public Health, Public Safety, Quarantine, Social Distancing, Underinsured, Unemployment, Unemployment Insurance, Uninsured, Vaccination, Vaccine, Wishful Thinking • Leave a comment

https://www.ft.com/content/2ed602f1-ed11-4221-8d0b-ef85018c96ea

Fed Makes Second Emergency Rate Cut to Zero Due To Coronavirus ...

Fed chair says economy may not fully bounce back until virus vaccine is available.

Federal Reserve chair Jay Powell has warned that a full US economic recovery may take until the end of next year and require the development of a Covid-19 vaccine.

“For the economy to fully recover, people will have to be fully confident. And that may have to await the arrival of a vaccine,” Mr Powell told CBS News on Sunday. A full revival would happen, he said, but “it may take a while . . . it could stretch through the end of next year, we really don’t know”.

He added: “Assuming there is not a second wave of the coronavirus, I think you will see the economy recover steadily through the second half of this year.”

Mr Powell told CBS it was likely there would be a “couple more months” of net job losses, with the unemployment rate climbing to as high as 20-25 per cent. But he said it was “good news” that the “overwhelming” majority of those claiming unemployment benefits report themselves as having been laid off temporarily, meaning they are expecting to go back to their old jobs.

Oil prices and stocks in Asia rose on Monday despite the gloomy outlook. West Texas Intermediate, the US crude benchmark, climbed 4.4 per cent to take it above $30 a barrel for the first time in two months. Brent crude, the international benchmark, rose 3.6 per cent to $33.67 a barrel. Japan’s Topix was up 0.4 per cent and China’s CSI 300 index of Shanghai- and Shenzhen-listed stocks added 0.6 per cent.

Donald Trump, US president, said last week that he hoped to have a vaccine ready by the end of 2020. But public health experts, including Anthony Fauci, the head of the US National Institute of Allergy and Infectious Diseases, and Rick Bright, the recently ousted head of the US Biomedical Advanced Research and Development Authority, have warned that the process is likely to take longer.

Dr Fauci, a high-profile member of Mr Trump’s coronavirus task force, has said he expects the search for a vaccine to take at least a year to 18 months. But Dr Bright has said that was too optimistic.

Some world leaders have also raised doubts about the immediate prospects for a vaccine. Giuseppe Conte, prime minister of Italy, said at the weekend that his country could “not afford” to wait for a vaccine, while Boris Johnson, UK prime minister, warned that a vaccine “might not come to fruition” at all.

Mr Powell said that while lawmakers had “done a great deal and done it very quickly”, Congress and the Fed may need to do more “to avoid longer-run damage to the economy”.

The Fed chair said fiscal policies that “help businesses avoid avoidable insolvencies and that do the same for individuals” would position the US economy for a strong recovery post-crisis.

Mr Powell also reiterated his position against using negative interest rates, something Mr Trump has called for. The Fed chair told CBS that the Federal Open Market Committee had eschewed negative interest rates after the last financial crisis in favour of “other tools” such as forward guidance and quantitative easing.

The US Congress has already approved nearly $3tn of economic relief measures intended to support struggling businesses and individuals, but there is growing consensus in Washington that more fiscal stimulus will be needed — even if Democrats and Republicans are divided over how to dole out federal funds.

Late on Friday, the Democrat-controlled House of Representatives passed Nancy Pelosi’s plan for $3tn in new stimulus spending.

Mr Trump has repeatedly called for the next stimulus to include a cut to payroll taxes — deductions for entitlements such as social security and Medicare. Last week, Larry Kudlow, the top White House economic adviser, suggested that lower corporate taxes and looser business regulation should be part of any future relief package.

The Trump administration has taken a more bullish stance on the US economic recovery than Mr Powell, with White House officials repeatedly insisting that the economy will bounce back before the end of the year.

Mr Powell told CBS it was a “reasonable expectation that there will be growth in the second half of the year” but “we won’t get back to where we were by the end of the year”.

 

 

 

 

 

Fed’s Powell warns unemployment could reach Depression-level 25 percent

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https://www.politico.com/news/2020/05/17/powell-unemployment-depression-25-percent-264500

Fed's Powell warns unemployment could reach Depression-level 25 ...

The Fed chief expressed hope that the economy would come out of recession in the second half of the year.

Federal Reserve Chair Jerome Powell on Sunday warned that the nation’s unemployment rate could soar to 25 percent during the worst of the coronavirus crisis, though he said the economy should recover more quickly than during the Great Depression, when joblessness last reached those levels.

“Those numbers sound about right for what the peak may be,” Powell said on CBS’ “60 Minutes” after reporter Scott Pelley asked whether unemployment could reach 20 percent or even 25 percent.

His remarks came just days after the central bank released a survey showing that one in five American workers lost their jobs in March — including almost 40 percent of those in lower-income households.

The Fed chief expressed hope that the economy would come out of recession in the second half of the year, but cautioned that a second outbreak of the coronavirus could derail that path.

“This economy will recover,” he said. “We’ll get through this. It may take a while. … It could stretch through the end of next year. We really don’t know.”

The central bank has taken extraordinary measures to rescue the economy since the pandemic began sweeping through the country — slashing interest rates to zero, rolling out trillions of dollars in lending programs for financial markets, and taking the unprecedented step of bailing out state and city governments.

“There’s really no limit to what we can do with these lending programs,” Powell said. “There’s a lot more we can do to support the economy, and we’re committed to doing everything we can as long as we need to.”

He said the economy stands a good chance of bouncing back more quickly than in the 1930s.

“When the Depression, well, when the crash happened and all that, the financial system really failed,” Powell said. “Here, our financial system is strong.”

But he took the opportunity to again warn that Congress will need to spend more to prevent long-lasting damage, even after U.S. lawmakers have shelled out trillions of dollars for American businesses and consumers.

The most important policy objectives should be to “keep workers in their homes, keep them paying their bills,” he said. “Keep families solvent so that when this comes, we come out the other end of this, we’re in a position to have a strong recovery.”