Last Friday, Congress passed and the president signed a continuing resolution (CR), averting a government shutdown and maintaining funding for important health care programs through Dec. 18.
Of note for essential hospitals, the CR also delays until Dec. 19 a scheduled $4 billion cut to Medicaid disproportionate share hospital (DSH) payments. America’s Essential Hospitals in a media statement thanked House and Senate lawmakers for standing with its member hospitals and patients by delaying this damaging cut.
The CR provides a one-week extension for negotiators to agree on fiscal year 2021 federal spending and other important health care policies. Must-pass spending legislation at the end of the year could address several issues important to essential hospitals, including maternal mortality, COVID-19 relief, and surprise billing.
Details of Bipartisan COVID-19 Deal
A new two-part legislative proposal would offer $908 billion for unemployment benefits, state and local aid, and other priorities to mitigate the pandemic, marking a possible step forward in COVID-19 relief negotiations.
The legislation, presented by a group of bipartisan senators in conjunction with the House Problem Solvers Caucus, is divided into two parts:
- a $748 billion package with largely bipartisan policies, including the Paycheck Protection Program and unemployment benefits; and
- a $160 billion package that includes funding for state and local aid and liability protections — two areas of disagreement during negotiations.
Lawmakers hope separating the more contentious issues could allow progress on bipartisan relief efforts.
The proposal would appropriate an additional $35 billion to the Provider Relief Fund and offer additional flexibility and guidance on allocated dollars, such as clarifying appropriate uses and reporting requirements. The proposal also calls for the Department of Health and Human Services to distribute funds to providers who were underrepresented in earlier funding disbursements.
House Speaker Nancy Pelosi (D-CA) and Senate Minority Leader Chuck Schumer (D-NY) characterized this plan as the best pathway to achieving a bipartisan deal. But Senate Majority Leader Mitch McConnell (R-KY) last week indicated it was unlikely to receive the needed votes from the Republican caucus. Treasury Secretary Steve Mnuchin last week presented a separate $916 billion COVID-19 package to Democratic leadership, who ultimately rejected it for insufficient unemployment benefits.
It remains unclear how congressional leadership will move forward now that the legislative text of the bipartisan deal has been released.
Compromise on Surprise Billing Proposal
Late Friday, leaders of several congressional committees announced a deal on legislation to address surprise medical bills. The legislation comes after a two-year policy standoff on surprise billing, also known as balance billing, which occurs when a patient is unexpectedly billed an out-of-network rate for a health care service or item.
The announcement last week was made by members of the Senate Health, Education, Labor, and Pensions Committee and the House committees on Energy and Commerce, Ways and Means, and Education and Labor.
Like previous proposals, the agreement would prohibit balance billing patients for more than the in-network rate for rendered services or items. Insurers and providers would have 30 days to agree to an acceptable payment for the remaining charges. If an agreement is not reached, insurers and providers would choose to enter an independent dispute resolution (IDR) or binding arbitration process. Under the IDR framework, both parties would submit what they believe should be the appropriate payment for the claim. An independent arbiter would determine which of the two submissions is appropriate, based on several factors. Once a decision is made, the provider or insurer may not initiate arbitration for the same item or service, with the same party, for 90 days.
Notably, this proposal does not establish a government mandated benchmark payment rate for out-of-network care, nor does it rely on a minimum dollar threshold for claims eligible for arbitration. However, the arbiter is required to consider the median in-network rate for the item or service in question when determining the level of payment.
Pelosi and Schumer have announced their support for this legislation. McConnell has yet to weigh in on the proposal; his support is necessary if lawmakers want to include the surprise billing proposal in must-pass legislation before the end of the year.