Subscribe to receive email updates as new information becomes available.

Following nearly a full week of around-the-clock negotiations, on late Wednesday evening the U.S. Senate passed its coronavirus economic relief bill with a unanimous vote of 96-0.  Then, despite some bipartisan opposition to the bill, on Friday afternoon the House of Representatives passed it with a voice vote.  Hours later, President Trump signed it into law. 

The $2.2 trillion, 880-page bill is officially titled the “Coronavirus Aid, Relief, and Economic Security Act", or "CARES Act”, and it includes many different provisions intended to help individuals, families, businesses, and the healthcare sector survive this national emergency.  

For individuals and families, the bill provides economic aid through various programs, including expanding unemployment insurance benefits and making direct cash payments to those making up to $75,000 per year ($150,000 for married couples) with smaller amounts to those making more and phasing out completely at $99,000 ($198,000 for married couples).  

For businesses, the bill offers a host of targeted tax credits.  It also creates a new $454 billion loan guarantee program to offer financial assistance to distressed businesses, while earmarking a separate $350 billion in potentially forgivable loans to help small businesses (those with less than 500 employees) pay fixed costs such as payroll, rent, and utilities.  

Provisions offering assistance or regulatory relief to healthcare providers include:

  • $100 billion emergency fund for healthcare providers. The bill increases funding for the Public Health and Social Services Emergency Fund by $127 billion, with $100 billion earmarked to reimburse eligible healthcare providers for healthcare-related expenses or lost revenues not otherwise reimbursed that are directly attributable to COVID-19.  Funding would be distributed by HHS through grants or other mechanisms and would remain available until expended, but the specific details and circumstances of when, how, how much, or to whom this funding will be provided to are still to be determined.
  • Increased reimbursement and advanced payments for hospitals. The bill increases Medicare payments made to hospitals for treating COVID-19 patients by 20 percent and delays scheduled reductions in Medicaid disproportionate share hospital payments through November 30.  The bill also provides hospitals access to advanced payments from Medicare through the expansion of an existing program.
  • $1.32 billion in supplemental grant funding for community health centers. Health centers received $100 million in the March 6 bill and HRSA announced this week that those funds would be distributed as soon as possible to every center in the nation, with an average award of approximately $70,000 per center (with the awards ranging from $50,000 to $300,000).  With each center getting approximately $70,000 from the $100 million appropriation, each center can expect an average payment of $900,000 if the $1.32 billion is similarly distributed.  
  • Extension of community health center federal grant funding through November 30. This bill extends federal grant funding for community health centers at current levels from May 22 (when it was previously set to expire) through November 30.  Also extended through November 30 is funding for two programs that help provide staffing support for some centers, the National Health Service Corps and Teaching Health Centers that Operate Graduate Medical Programs.  Health center advocates had been pushing for this funding (which is not tied to the COVID-19 crisis) for month
  • Allows community health centers to deliver telehealth services to Medicare patients. Several states have recently issued new Medicaid policies that enable FQHCs to receive Medicaid reimbursement for telehealth services, but this provision would for this first time allow FQHCs to get paid for providing telehealth services to Medicare patients.  This bill says that during the emergency, FQHCs can furnish telehealth services to Medicare beneficiaries under the same conditions that the CMS waiver provided the Medicare program last week and at the same reimbursement rates.
  • 2 percent Medicare payment increase for physicians. The bill lifts the Medicare sequester, which for years has reduced Medicare payments to physicians and other providers by 2 percent, from May 1 through December 31, 2020.  It is estimated that sequestration would reduce Medicare reimbursement to providers by $15 billion in fiscal year 2020.
  • Offers partially forgivable loans for small businesses (including many physician groups) to pay certain fixed costs. This bill creates the “Paycheck Protection Program” for small businesses with less than 500 employees (which would include many physician groups) to obtain government backed loans of up to $10 million from Small Business Administration lenders.  These loans are only eligible to pay for fixed costs, such as rent, mortgage, insurance, and payroll expenses.  And to discourage staff reductions, to the extent that the loan proceeds are used to fund those fixed costs during an eight-week period, a loan could be fully forgiven if a business retains its employees and their salary levels.  All borrower fees would be waived and principal and interest payments deferred for at least six months.  For physician groups, there are many limitations and conditions to consider, but the program is intended to provide an eight-week forgivable loan (a grant) to pay for certain fixed costs and avoid staff reductions.  

While there are certainly many other provisions in this $2.2 trillion legislative package, these policies are likely to have the biggest impact on healthcare providers.  And critically, these policies will soon empower federal administrative and regulatory agencies to allocate hundreds of billions of dollars to distressed healthcare providers.  As such, the discretionary decisions these agencies make in the next few weeks will have a huge impact not only on our nation’s healthcare providers, but on our nation’s ability to successfully combat the COVID-19 virus as well.

 

Meet NextGen Ambient Assist, your new AI ally that generates a structured SOAP note in seconds from listening to the natural patient/provider conversation.

Read Now
Chris Emper headshot
Government Affairs Advisor, NextGen Healthcare
Chris Emper, JD, MBA, is government affairs advisor at NextGen Healthcare and president of Emper Healthcare Advisors—a health IT industry advisory and consulting services firm in Washington, D.C. that specializes in helping healthcare providers and technology companies successfully navigate and comply with complex regulations and value-based reimbursement models. Prior to forming Emper Healthcare...