[Updated] HHS Sending $25 Billion to Medicaid Providers, Safety Net Hospitals

After nearly two months of waiting, Medicaid-reimbursed in-home care providers appear to finally be getting some financial assistance to help cover coronavirus costs.

The U.S. Department of Health and Human Services (HHS) announced Tuesday it is distributing an estimated $15 billion to providers that participate in Medicaid and the Children’s Health Insurance Program (CHIP). HHS also plans to send roughly $10 billion to America’s network of safety net hospitals, which care for vulnerable citizens regardless of their insurance status.

The combined total of $25 billion comes from the Provider Relief Fund, a pool of relief money created by the bipartisan CARES Act to help keep U.S. health care organizations afloat as they deal with canceled appointments, rising personal protective equipment (PPE) costs and other coronavirus-related challenges.

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“Health care providers who focus on treating the most vulnerable Americans, including low-income and minority patients, are absolutely essential to our fight against COVID-19,” HHS Secretary Alex Azar said in a statement. “HHS is using funds from Congress, secured by President Trump, to provide new targeted help for America’s safety-net providers and clinicians who treat millions of Medicaid beneficiaries.”

Prior to Tuesday, the federal government had already dispersed tens of billions of dollars’ worth of financial relief, including $30 billion to Medicare-reimbursed organizations on April 10 and another $20 billion to a variety of health care providers shortly thereafter.

To be eligible for the newly announced $25 billion, providers must have not received payments from the earlier emergency-funding rounds, according to HHS.

Nationally, Medicaid and CHIP provide health and long-term care coverage to more than 70 million low-income children, pregnant women, adults, seniors and individuals with disabilities. In 2018, joint federal and state Medicaid spending on home- and community-based care services totaled $92 billion, according to statistics from the Kaiser Family Foundation.

While Medicare-reimbursed home health agencies received relief payments relatively quickly, their peers in the Medicaid space were left waiting due to red tape. HHS first asked state officials for data on Medicaid spending on May 1 so the department could begin sending direct payments to providers.

State officials, however, were reportedly slow to respond to that request, with some states lobbying to act as a middleman between Provider Relief Fund money and health care providers.

U.S. Senators Charles Grassley (R-Iowa) and Ron Wyden (D-Ore.) voiced concern over the delay in a June 3 letter to HHS. Representatives Frank Pallone, Jr. (D-N.J.), and Greg Walden (R-Ore.) also signed onto the letter.

“As the chairs and ranking members of the committees of jurisdiction over the Medicaid program, we are concerned that the delay in disbursing funds from the Public Health and Social Services Emergency Fund (PHSSEF) for Medicaid-dependent providers could result in long term financial hardship for providers who serve some of our most vulnerable populations,” the lawmakers wrote. “It could also severely hamper their ability to continue to serve as essential providers amid the COVID-19 pandemic and beyond.”

Grassley and Wyden are the chairman and ranking member of the Senate Committee on Finance, respectively. Pallone and Walden serve as chairman and ranking member of the House Committee on Energy & Commerce.

“Many of these providers are safety-net providers that operate on thin profit margins, if at all,” their letter continued. “The COVID-19 pandemic has strained their already scarce resources, threatening their ability to keep their doors open in the midst of a declared public health emergency.”

HHS plans to disburse payments to Medicaid-reimbursed in-home care providers and others through an “enhanced” online portal it’s launching on Wednesday. Once live, the portal will allow eligible Medicaid and CHIP providers to report their annual patient revenue, which will be used as a factor in determining their Provider Relief Fund payment, HHS noted in its announcement.

The payment to each provider will be at least 2% of reported gross revenue from patient care. HHS will determine the final amount each provider receives after data is submitted, including information about the number of Medicaid patients providers serve.

To be eligible, providers must have billed Medicaid, CHIP or their Medicaid managed care plans for health care-related services between Jan. 1, 2018, and May 31, 2020.

The Partnership for Medicaid Home-Based Care — a Washington, D.C.-based advocacy organization — was among the long-term care groups to thank HHS and Congress for the forthcoming financial support.

“The financial viability of Medicaid [home- and community-based services] providers is critical to the national health care infrastructure,” Partnership Chairman David J. Totaro said in a statement shared with Home Health Care News. “If HCBS providers are unable to continue delivering these health-sustaining services, at-risk populations will experience exacerbated chronic conditions or disabilities and increased emergency room visits and/or hospitalizations, all of which are critical to avoid, especially during this crisis.”

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