The manner in which the federal government is distributing COVID-19-related CARES Act funding is unfair to private safety-net hospitals, the National Alliance of Safety-Net Hospitals has written in a letter to Health and Human Services Secretary Alex Azar and Centers for Medicare & Medicaid Services Administrator Seema Verma.
The formula CMS used for its second round of funding from the $100 billion designated by the CARES Act for health care providers poses a distinct disadvantage to private safety-net hospitals, NASH wrote, because
With its emphasis on net patient revenue, this formula is damaging to safety-net hospitals that care for especially high proportions of Medicaid and low-income Medicare patients. As a result, hospitals that care for significant numbers of Medicaid and low-income patients are getting smaller grants, no grants at all, and in some cases a warning that they will be expected to return some of the money they have already received.
To address this problem, NASH asked administration officials to
…address these concerns by using the troubling outcome of this second tranche of payments to develop a consistent, appropriate funding formula that focuses more on hospitals than on other health care providers; that is fairer to safety-net hospitals than the second tranche formula; and that makes a concerted effort specifically to direct additional resources to safety-net hospitals. We also ask you to act immediately to ensure round one and round two grant recipients that there have been no “overpayments” of CARES Act funds and that the administration will not be asking them to repay some of the grants they have already received because the formula was changed.
See NASH’s letter here.