New Delhi, Phoenix, Agency News: There’s no denying that the healthcare industry in the United States has been hit especially hard by the COVID-19 pandemic. In addition to many physicians, nurses, and other healthcare professionals being on the front line caring for patients who contracted the virus, many provider organizations sustained large drops in revenue.
A study reported by Health Affairs in September 2020 found that primary care practices are expected to lose $67,774 in gross revenue per full-time-equivalent physician. Similarly, a poll conducted by the American Medical Association (AMA) found that 81 percent of physicians disclosed revenue remained below pre-pandemic levels and 70 percent of respondents reported providing fewer total visits (in-person and telehealth) than pre-pandemic.
Multiple federal financial assistance programs were enacted in 2020 to aid U.S. businesses in remaining financially viable during the COVID-19 pandemic, including the following:
- Coronavirus Preparedness and Response Supplemental Appropriations Act: provided $8.3 billion in emergency funding for federal agencies to respond to the coronavirus outbreak.
- Families First Supplemental Appropriations Act: provided paid sick leave, tax credits, and free COVID-19 testing; expanded food assistance and unemployment benefits; and increased Medicaid funding.
- Coronavirus Aid, Relief and Economic Security Act (CARES): provided emergency monetary assistance for individuals, families, and businesses affected by the pandemic.
- Paycheck Protection Program and Health Care Enhancement Act: provided an additional $321 billion in funding, with $60 billion set aside for small, midsize, and community lenders.
- Paycheck Protection Program Flexibility Act: extended the PPP loan forgiveness covered the period from eight weeks after the loan’s origination date to the earlier of 24 weeks or December 31, 2020.
Extension of Economic Aid
Although the vast majority of physician practice owners reported that this COVID-19 relief funding was very or extremely helpful, almost 75 percent of small businesses across all industries in the U.S. reveal that an additional federal relief package is needed to help their enterprise survive. To address the ongoing problem of revenue loss due to the pandemic, the U.S. government signed into law on December 27, 2020, the Consolidated Appropriations Act, 2021 (H.R. 133).
The act is an omnibus statute consisting of twelve the fiscal year 2021 appropriations bills for the federal government and an economic aid package to assist business concerns that continue to face hardships due to the COVID-19 pandemic. Title III of the Consolidated Appropriations Act of 2021 is titled Economic Aid to Hard-hit Small Businesses, Nonprofits, and Venues. This act provides additional funding to small businesses under the Paycheck Protection Program (PPP) allows eligible borrowers to receive a second draw loan, simplifies loan forgiveness for loans under $150,000, and classifies forgiven PPP loans as tax-deductible.
Also part of the Consolidated Appropriations Act of 2021 is the Coronavirus Response and Relief Supplemental Appropriations Act, which encompasses some information specific to the healthcare industry. As a healthcare leader, there are five key points included in the act of which you should be aware.
1. Provider Relief Fund Phase 3
Phase 3 offers $24.5 billion in new funding to all providers eligible for a previous Provider Relief Fund distribution and new 2020 providers and behavioral health providers. Located in Division M of the Coronavirus Response and Relief Supplemental Appropriations Act of 2021, this phase is designed to “make payments to eligible healthcare providers based on applications that consider financial losses and changes in operating expenses occurring in the third or fourth quarter of the calendar year 2020, or the first quarter of the calendar year 2021, that is attributable to coronavirus.
The Health Resources and Services Administration (HRSA) in Phase 1 of this program distributed $50 billion to providers who bill Medicare fee-for-service in order to provide financial relief funding during the coronavirus COVID-19 pandemic. In Phase 2, $18 billion was made available to eligible providers, such as participants in state Medicaid/CHIP programs, Medicaid managed care plans, dentists, and certain Medicare providers.
Funds appropriated under the Provider Relief Fund may be made available for the building or construction of temporary structures, leasing of properties, medical supplies, and equipment, including personal protective equipment and testing supplies, increased workforce and training, emergency operation centers, retrofitting facilities, and surge capacity (page 739 of the act). The Act also notes that to be eligible for a payment a healthcare provider should have a valid tax identification number and submit to the Secretary an application that includes a statement justifying the need of the provider for the payment.
HRSA also has assisted healthcare providers through the Families First Coronavirus Response Act (FFCRA), which appropriates $1 billion to reimburse them for conducting COVID-19 testing for uninsured individuals. Eligible providers include those who have:
- Conducted COVID-19 testing of uninsured individuals
- Provided treatment to uninsured individuals with a COVID-19 primary diagnosis
- Administered a licensed or authorized COVID-19 vaccine to uninsured individuals on or after February 4, 2020.
According to HRSA, a patient is considered uninsured if he or she doesn’t have coverage through an individual or employer-sponsored plan, a federal healthcare program or the Federal Employees Health Benefits Program at the time the services were rendered.
2. 2021 Medicare Payment Changes Support
Title I of Division N of the Act, titled “Supporting Physicians and other Professionals in Adjusting to Medicare Payment Changes During 2021,” increases fee schedules that establish payment amounts for services furnished on or after January 1, 2021, and before January 1, 2022, by 3.75 percent (page 768). It also transfers $3 billion from the General Fund of the Treasury to the Federal Supplementary Medical Insurance Trust Fund to remain available until expended.
3. Increased Transparency Through Removal of Gag Clauses
In Title II of the Act, the focus is on “Increasing Transparency by Removing Gag Clauses on Price and Quality Information.” It prohibits group health plans from the following:
- Providing provider-specific cost or quality of care information or data through a consumer engagement tool or any other means to referring providers, the plan sponsor, enrollees, or individuals eligible to become enrollees of the plan or coverage.
- Electronically accessing de-identified claims and encounter information or data for each enrollee in the plan or coverage.
- Sharing information or data or directing that such data be shared with a business associate, consistent with privacy regulations of the Health Insurance Portability and Accountability Act (HIPAA).
4. Expanded Capacity for Health Outcomes
Title III, Public Health Provisions (page 1746) directs that the Secretary shall award grants to evaluate, develop and expand the use of technology-enabled collaborative learning and capacity building models to improve retention of healthcare providers and increase access to healthcare services, such as those to address:
- Chronic diseases and conditions
- Infectious diseases
- Mental health
- Substance use disorders
- Prenatal and maternal health
- Pediatric care
- Pain management
- Palliative care
- Specialty care in rural, frontier, and medically underserved areas or for Native Americans
5. Expanded Access to Mental Health Services Through Telehealth
The Department of Health and Human Services (HHS) recently extended two telehealth waivers, one to enable more types of providers to bill Medicare for telehealth services and the other for the reimbursement of audio-only telehealth services for all providers. The Coronavirus Response and Relief Supplemental Appropriations Act extended coverage of telehealth services for “disorder and mental health services.