UPDATE: April 9, 2020: CMS on Thursday hiked the amount of Medicare accelerated payments it's getting to providers this week from its original estimate of $34 billion to more than $51 billion. This funding is in the form of loans and is separate from the $30 billion in CARES funding HHS also announced this week.
- The Trump administration plans to roll out the first $30 billion in funding from the latest stimulus package to hospitals this week, CMS Administrator Seema Verma said Tuesday at a White House coronavirus task force briefing.
- The Coronavirus Aid, Relief, and Economic Security Act passed by Congress in March benchmarked $100 billion in funding to prop up U.S. hospitals struggling with the financial effects of the coronavirus pandemic. This first wave of dollars will be apportioned in grants to hospitals based off their Medicare revenue, with "no strings attached," Verma said.
- The government will directly deposit the money into some hospitals' banks accounts if possible, but other providers may have to register to receive their share. Some $64 billion in aid is flowing into the healthcare system this week alone, Verma said, including the CARES funding and expedited Medicare payments to providers.
President Donald Trump signed the largest stimulus package in history, the CARES Act, on March 27, freeing up $2 trillion in funds to jolt the U.S. economy and bolster the healthcare system, though it wasn't originally clear how the money would be apportioned to providers.
"This is not on a first-come, first-serve basis. We are basing this on [hospitals'] Medicare revenue," Verma said regarding the first wave of funding this week. "They will get these dollars. Even if it takes a few days, there shouldn't be any panic in the system."
It's crucial to get this money to hospitals and doctors as quickly as possible, providers say, to help them get a handle on the virus that's infected almost 400,000 people in the U.S. and killed almost 13,000 as of Wednesday morning. Hospitals are having to shore up expensive resources like personal protective equipment, ventilators and respirators while most have halted lucrative elective procedures — a big hit to their revenue.
The American Hospital Association previously lobbied for hospitals to receive $25,000 per hospital bed — $30,000 if the facility is in a COVID-19 hotspot — a figure which would tally up to about $23 billion of the CARES fund.
And allocating the funds to hospitals based off their Medicare fee-for-service revenue could hurt hospitals that care for disproportionate numbers of uninsured and Medicaid patients, a trade group representing such facilities said — especially since those hospitals usually have smaller margins and are more likely to be at risk of closing.
Verma said there will be a second tranche of funding to address providers that get the majority of their revenue from non-Medicare sources, such as pediatricians, children's hospitals, OBGYNs and nursing homes.
Bruce Siegel, president and CEO of America's Essential Hospitals, said in a statement the group appreciates that Verma "acknowledged this distribution approach will fall short for many providers and that the agency will follow this release of funding with another focused on Medicaid-dependent providers."
The Trump administration has said a portion of the $100 billion pie will be diverted to cover COVID-19 testing and treatment for the roughly 30 million uninsured Americans. It's a significant promise: A Kaiser Family Foundation analysis released Tuesday estimated that hospital costs for the uninsured could reach as high as $42 billion.
And though the emergency funding legislation included a 20% bump in Medicare rates for common treatments of the disease, hospitals could still lose roughly $1,200 per COVID-19 case, according to one analysis.
CMS on Thursday also said it has delivered almost $51 billion in expedited Medicare payments to providers. CMS expanded its Accelerated and Advance Payment Program late last month to get funds to hospitals and doctors' offices more quickly due to the national emergency. Verma said CMS has had roughly 32,000 requests for the accelerated dollars, which are essentially loans and separate from stimulus funding, and approved about 21,000 of them so far.
That's a huge jump from a normal year — CMS processed only 115 accelerated/advance payment requests over the past five years, a spokesperson told Healthcare Dive. The government last made the advance payments available to providers during Hurricanes Harvey and Irma in 2017.