The end of the COVID-19 Public Health Emergency will bring the largest health coverage changes since implementation of the Affordable Care Act.
The Families First Coronavirus Response Act’s continuous coverage requirement prevents state Medicaid agencies from disenrolling people during the COVID-19 public health emergency. However, when the declaration of the emergency expires—currently scheduled for April 2023—states will resume normal eligibility determinations. This could result in millions losing access to affordable health coverage through Medicaid.
18 million people could lose Medicaid coverage when the COVID-19 public health emergency (PHE) ends, according to a new analysis.
While many who are currently enrolled in Medicaid will transition to other coverage options, nearly 4 million people (3.8M) will become completely uninsured.
19 states will see their uninsurance rates spike by more than 20 percent.
3.2 million children will transition from Medicaid to separate Children’s Health Insurance Program (CHIP) health plans.
State Medicaid officials and policymakers must continue to ensure that individuals currently enrolled in Medicaid are aware of the approaching end of the public health emergency, and that they have a plan to maintain or find new health coverage through their employer, the federal healthcare Marketplace, or Medicaid.
While healthcare wasn’t a top priority for lawmakers hammering out the Omnibus bill aimed at keeping the government open through next September, the graphic above outlines the bill’s three greatest areas of impact for providers.
The package reduces the planned 4.5 percent 2023 physician fee schedule cut to two percent, while also extending value-based care bonuses in alternative payment models (albeit at 3.5 percent, instead of five percent). It also delays the $38B Medicare spending cut required by the PAYGO sequester, pushing that cut out two years.
On the telehealth front, the bill extends Medicare’s pandemic-era virtual care flexibilities through 2024, including the “hospital at home” waiver. It also sets April 1, 2023 as the start date of a one-year window for states to reassess Medicaid enrollment,decoupling the start of eligibility redeterminations from the end of the federal COVID public health emergency. Medicaid enrollment grew by 25 percent over the course of the pandemic, but around two-thirds of new enrollees may lose eligibility after redeterminations.
Overall, the legislation is a mixed bag for providers.The uninsured population is expected to grow, at least in the short term. Physician groups had hopes for a complete reprieve from Medicare pay cuts, and the fact that they didn’t get it may signalgrowing Congressional hesitancy to intervene with the Medicare physician fee schedule in the future. But the telehealth extensions may encourage other wider adoption of reimbursement by private insurers, bolstering providers’ long-term virtual care investments.
Late last week, President Biden signed a $1.7T spending package to fund the federal government through next September. While around half the funds are dedicated to defense, some important healthcare items made it into the bill, including a reduction in planned Medicare physician pay cuts and a two-year postponement of the $38B Medicare spending cut required by the PAYGO sequester.
The law also decoupled several measures from the end of the federal COVID public health emergency (PHE), setting April 1st as the start date for states to begin Medicaid eligibility redeterminations, and extending Medicare’s telehealth flexibilities and the Acute Hospital Care at Home waiver program through the end of 2024. For more details on these changes, see our graphic below.
The Gist: Medical groups were hoping for more of a reprieve from the Medicare physician fee schedule cuts, but Congress proved unwilling to address concerns over rising practice costs. We’re relieved that Medicare’s new telehealth and hospital at home policies will continue beyond the PHE, given the early interest we’ve seen from the provider community in embracing these new, more consumer-friendly care models.
Once the new Congress finally gets underway, we’re expecting this to be an uneventful two years for federal healthcare legislation, with the emphasis of health policy likely to shift toward states, federal agency rulemaking, and judicial activity.
Americans expect the best care from their doctors. Decades of experience, thoughtful interdisciplinary planning, and evidence-based research mean providers are treating them based on widely accepted standards of care.
For example, someone who has experienced a heart attack would never be discharged from a hospital without being prescribed medications to mitigate future cardiac events. A patient with acute pulmonary issues would receive medications and resources for oxygen therapy, if appropriate. Stroke patients receive the acute hospital-based care they need to save their lives, as well as a constellation of other types of care and services to decrease complications and enhance recovery — pharmacological, dietary, and rehabilitative.
Physical therapy and occupational therapy are among the critical standards of care that would be included for all of these patients. These services help form the bedrock of ensuring good outcomes, decreasing secondary injury and complications, and reducing rehospitalizations.
In addition to serving as an important part of post-acute care, physical and occupational therapy provided by licensed therapists can help improve balance and mobility, improve cardiovascular function, reduce pain, and decrease falls. In fact, healthcare associated with falls costs the healthcare system tens of billions of dollars each year — and exercise interventions by physical therapists have helped to lower the risk of falls by 31%.
Eliminating or reducing access to physical and occupational therapy due to Medicare cuts would be devastating to patients’ health outcomes. Not only would it undermine the standards of care for many conditions, it would also complicate the lives and tenuous health situations of the millions of Americans who depend upon it.
Seniors nationwide, therefore, are extremely concerned about the 4.5% cut to their therapy providers in 2023 under the Medicare Physician Fee Schedule. If this cut is implemented, the physical and occupational therapy community will experience cuts totaling approximately 9% by 2024. The continued practice of annual Medicare cuts threatens the sustainability of the country’s physical and occupational providers, especially in rural and underserved areas where they are needed most.
Our nation’s Medicare beneficiaries understand how integral physical and occupational therapy are to standards of care — and they value it deeply. According to a recent survey, 9 out of 10 Americans over the age of 65 have favorable views of physical therapists, and the majority see considerable value in the services they provide. Nearly the same number (88%) expressed concerns that proposed Medicare payment cuts may eliminate alternatives for therapy outside of nursing homes and eliminate seniors’ ability to age in place. More than three in four respondents (76%) say it is important for them to be able to access their physical therapist when they cannot come into the office for an in-person appointment.
Care professionals across the healthcare continuum — from skilled therapists to physicians to nurse practitioners and physicians’ assistants — recognize the negative impact these cuts would have on their patients, and support efforts in Congress to address these cuts in the year ahead.
Bipartisan lawmakers in Congress have introduced legislation to block these harmful cuts from taking effect in 2023, an essential step toward ensuring all Americans can access quality physical therapy and other specialty services. The Supporting Medicare Providers Act of 2022 (H.R. 8800) would block Medicare’s Physician Fee Schedule cuts by providing an additional 4.42% to the conversion factor for 2023.
It’s inconceivable to think we can continue to provide thorough care without one of the most essential elements — therapy. We hope that Congress will act — and quickly before the end of the year — so that our critically important healthcare standards for patients suffering from a multitude of diseases, injuries, and conditions are not irrevocably undermined.
Even before the pandemic, healthcare workers accounted for nearly three quarters of non-fatal injuries from violence in the workplace. Given the level of emotion and stress experienced in hospitals, that’s not surprising. But during the pandemic, once-sporadic violent outbursts became routine, leaving many healthcare workers fearful for their safety.
According to several health systems we’ve recently spoken with, violent events haven’t waned as the number of COVID admissions has fallen. One hospital CEO recently told us, “I never would’ve imagined that security would consume so much of my time. We keep looking for a great solution, but despite a ton of effort and a lot of money, it’s barely made a dent.” The cost of additional security—more personnel, metal detectors, restricted access—can run into millions annually for the average hospital.
Another CEO shared, “We want the hospital to be a healing environment, not feel like a prison, so we were looking for less-threatening alternatives. But those were even more expensive. Placing a canine team in the ED would run over $1M per year!” And violent episodes are not limited to hospitals, with systems reporting an increase in incidents at outpatient and clinic sites where it’s not feasible to place onsite security, given the number of smaller-scale locations.
Human resource leaders report that experiencing workplace violence, either personally or through a colleague, has been a tipping point for those considering leaving the field. According to one CHRO, workers experiencing repeat violence has been increasingly common: “We recognized the importance of having someone very senior—CEO, COO, or CMO—personally reach out to staff who have been assaulted in the workplace. But there are people who we’ve now had to call two or even three times. It’s hard to even know what to say in those situations.”
In addition to visible security and constant staff communication, providers must lobby state and federal lawmakers for legislation that requires tracking and reporting of healthcare workplace violence, and increases penalties. The Workplace Violence Prevention for Health Care and Social Service Workers Act was passed by the US House of Representatives in 2021, and was recently introduced into the Senate, so it’s time to contact your representatives and urge them to move this bill forward.
On Tuesday, the Centers for Medicare and Medicaid Services (CMS) announced a proposed rule that aims to streamline the prior authorization process by requiring certain payers to establish a method for electronic transmission, shorten response time for physician requests, and provide a reason for denials. This rule replaces one proposed in December 2020 that was never finalized.
In addition to applying to Medicaid and Affordable Care Act exchange plans, the new rule would also apply to Medicare Advantage plans, which the previous rule did not. If finalized, it will take effect in 2026.
The Gist: Managing prior authorization requests is one of providers’ greatest sources of frustration, with over 80 percent of physicians rating it as “very or extremely burdensome” in a recent Medical Group Management Association survey.
Not only would patients would benefit from faster turnarounds, but even major payers agree that the status quo is suboptimal, and payer advocacy organization AHIP has signaled support for transmitting prior authorization requests electronically.
The challenge for regulators will be to strike a balance that satisfies the competing interests of payers and providers—turnaround time is likely to be a sticking point—but the one good thing about a system that no one likes is that there’s plenty of room for improvement.
And in Texas, an expansion could reduce the $7 billion in uncompensated care hospitals there have to absorb each year, according to the state’s hospital association.
Yes, but: Republican lawmakers in the holdout states continue to oppose enlarging their Medicaid rolls, citing higher state costs of covering a bigger population.
And hospital associations in North Carolina and Florida have opposed expansion plans, either out of concern about alienating key lawmakers or because the plans could bring other changes that disrupt dollars flowing to their members.
State of play: South Dakota voters approved a Medicaid expansion ballot measure this fall, leaving 11 non-expansion states.
Democratic governors in North Carolina and Kansas think they may be wearing down Republican opposition, Politico reports, but still face uphill battles when the new legislative sessions begin.
Zoom in: Medicaid expansion can bring dollars into a state’s health care system, even if the program pays only a fraction of the actual cost of care.
Numerous studies show that Medicaid expansion can have a positive financial impact on hospitals’ operating and profit margins, particularly smaller rural facilities, Robin Rudowitz, vice president at the Kaiser Family Foundation, told Axios.
The program could provide a reprieve for hospitals that were kept afloat in part by federal pandemic aid that’s now drying up.
“We have hospitals with 12 days cash on hand. We’ve lost a nursing home this year. We have seen decreased services. We’ve lost OB services in a few places, and we’ve seen over the years the decrease in mental health,” Wyoming Hospital Association vice president Josh Hannes told state lawmakers last month, per Politico.
Expanding Medicaid in other states has also led to a significant decline in uncompensated care costs, as well as improved states’ health outcomes, including overall mortality.
Yes, but: Medicaid expansion is not necessarily a silver bullet that will rescue every struggling facility.
Some state hospital associations are seeking other types of relief, from cuts in hospital bed taxes or higher reimbursements for existing Medicaid beneficiaries.
Of note: Rural, small hospitals have the most to gain from Medicaid expansion, because they serve a smaller patient populations with a larger pool of uninsured people.
Congress sweetened the deal for non-expansion states in the American Rescue Plan Act, with a 5% increase in the federal Medicaid Assistance Percentage for the state’s current Medicaid recipients, which lasts for two years.
In Texas, whose uninsured rate is the highest in the nation, hospital leaders think Medicaid expansion could help cover many in the working class whose jobs do not offer health plans.
“If you could get those folks coverage at a Medicaid rate it would obviously help the financial situations of (rural) hospitals, and if you could get them to a medical home you could deal with more acute medical conditions going forward,” John Hawkins, president of the Texas Hospital Association, told reporters last week.
The bottom line: While rural hospitals all over are facing headwinds, those in non-expansion states are bearing the brunt of the pain. And while there is a potential lever for those states, it doesn’t appear likely their elected officials are willing to pull it.
Driven by the steady progress of Medicaid expansion and pandemic-era policies to ensure access to health insurance coverage, the US uninsured rate hit an all-time low of 8 percent in early 2022. Since the Affordable Care Act passed in 2010, the US uninsured rate has been cut in half, with the largest gains coming from Medicaid expansion.
However, using data from Commonwealth Fund, the graphic below illustrates how this noteworthy achievement is undermined by widespread underinsurance, defined as coverage that fails to protect enrollees from significant healthcare cost burdens. A recent survey of working-age adults found that eleven percent of Americans experienced a coverage gap during the year, and nearly a quarter had continuous insurance, but with inadequate coverage.
High deductibles are a key driver of underinsurance, with average deductibles for employer-sponsored plans around $2,000 for individuals and $4,000 for families.
Roughly half of Americans are unable to afford a $1,000 unexpected medical bill. Americans’ healthcare affordability challenges will surely worsen once the federal COVID public health emergency ends, because between 5M and 14M Medicaid recipients could lose coverage once the federal government ends the program that has guaranteed continuous Medicaid eligibility.
The process of eligibility redeterminations is sure to be messy—while some Medicaid recipients will be able to turn to other coverage options, the ranks of uninsured and underinsured are likely to swell.
An unsparing piece published this week in the New Yorker examines the unscrupulous and exploitative practices of AseraCare and several other for-profit hospice providers, who have gone from controlling 30 percent of the hospice market to more than 70 percent across the last decade. The article outlines the companies’ playbook of delivering the least amount of care to the greatest number of patients, many of whom are not actually in need of hospice services at all.
In order to game Medicare’s policy to extract repayments from hospice providers whose average patient stay exceeds six months, many of these companies have employed strategies ranging from recruiting “last breath” patients from oncologists to lower their average length of stay, to “graduating” an absurd 70 percent of enrolled patients once they reach their six-month limit.
The Gist: While it only takes a few bad apples spoil the bunch, the US hospice industry appears to be in a thoroughly rotten state. Caring for the elderly and dying is already a difficult (and expensive) proposition, and the questionable practices detailed in this piece further undermine the good work being done by those providers committed to helping patients and their families during extraordinarily difficult times.
Currently subject to only minimal federal oversight, the hospice industry is in dire need of stronger regulation, which might take its cue from California, which recently issued a licensing moratorium for hospice providers while redesigning its auditing process.
Surgeons in Ukraine operated on a patient in the dark using only a flashlight after Russia unleashed a missile barrage on the nation’s power grid. (NBC News)
Pharma industry groups and CVS Health expressed skepticism over a plan proposed by the FDA that would allow certain generic drugs to pick up over-the-counter indications. (Endpoints News)
Marketing biosimilars with skinny labels — labels for biosimilars or generics that include a smaller set of indications than the brand-name drugs — saved Medicare $1.5 billion from 2015 to 2020, 5% of what it spent on five biologics during that period. (JAMA Internal Medicine)
Flu hospitalizations are up nearly 30% from last week, as scientists and public health experts express concern about the virus spreading during holiday gatherings. (CNBC)
As the CDC prepares to announce nearly $4 billion to improve public health infrastructure, most of which will be allocated to local health departments, community-based health groups say they’re being left out of funding. (CNN)