Federal Health Policy Update for Friday, July 2

The following is the latest health policy news from the federal government as of 2:45 p.m. on Friday, July 2.  Some of the language used below is taken directly from government documents.

Supreme Court

  • The Supreme Court has announced that it will hear a case in its next term challenging cuts in 340B payments and another involving Medicare disproportionate share.

White House

Provider Relief Fund

  • HHS has published new information about use of Provider Relief Fund grants, accounting for the use of those grants, expense and lost revenue calculations, changes in ownership, reporting on the use of Provider Relief Fund resources, and more.  The changes, including links to new documents, worksheets, instructions, an FAQ, a link to a webinar to learn about these changes, and more can be found on the Provider Relief Fund’s “reporting requirements and auditing” web page.  Recipients of Provider Relief Fund grants should review this new information carefully.
  • HHS also has updated its Provider Relief Fund FAQ site to reflect the changes introduced on the primary Provider Relief Fund web site (described above).  The update includes 24 new or updated items addressing the expenditure of Provider Relief Fund grants, accounting for and reporting on the use of those grants, recoupments, FEMA funds, and more.  The changes, marked “7/1/2021,” can be found on pages 8, 9, 11, 12, 16, and 22-27.

Department of Health and Human Services


  • HHS’s Office of the Assistant Secretary for Preparedness and Response has introduced a COVID-19 monoclonal antibody therapeutics calculator for infusion sites (mAbs Calculator) to inform staffing decisions and resource investments needed for COVID-19 monoclonal antibody therapeutic infusion sites.  Go here to learn more about the calculator and to find a link to it.
  • HHS’s COVID-19 health equity task force met this week to consider interim recommendations addressing the inequities and the impact of long-COVID or Post-Acute Sequelae COVID-19 infection and access to personal protective equipment, testing, and therapeutics.  Go here for a summary of the meeting and links to a recording of the event.

Health Policy News

Centers for Medicare & Medicaid Services

Health Policy News

  • CMS has released the final notice for the Basic Health Program federal funding methodology for program year 2022.  This document provides the methodology and data sources necessary to determine federal payment amounts for program year 2022 to states that elect to establish a Basic Health Program to offer health benefits coverage to low-income individuals otherwise eligible to purchase coverage through qualified health plans in the exchange.  Learn more in the proposed rule.
  • CMS has proposed updating its End-Stage Renal Disease (ESRD) prospective payment system rates, changing the ESRD Quality Incentive Program, and modifying the ESRD Treatment Choices (ETC) Model.  The proposed changes to the ETC Model policies seek to encourage dialysis providers to decrease disparities in rates of home dialysis and kidney transplants among ESRD patients with lower socioeconomic status.  Other changes in the proposed ESRD regulation address rates, wage index, an update of the outlier policy, a transitional add-on payment adjustment for new and innovative equipment and supplies applications, and more.  Learn more from the following resources:

Centers for Disease Control and Prevention


  • The CDC has published a report in which it evaluates the effectiveness of COVID-19 vaccines among health care workers during the early phase of vaccinations.  Find the report here.
  • The CDC has updated its guidance for laboratories on the use of pooling for COVID-19 testing.  The new guidance notes that while pooling specimens for public health surveillance purposes is still acceptable, the focus now is on its use for diagnostic and screening testing.
  • The CDC has issued a guide for jurisdictions on expanding COVID-19 vaccine distribution to primary care providers to address disparities in immunizations.  Find it here.
  • The CDC has published research on the efficacy of portable air cleaners and masking for reducing indoor exposure to simulated exhaled COVID-19 aerosols.  Read the report here.

Health Policy News

  • The CDC reports that the number of cancer screenings received by women through the CDC’s National Breast and Cervical Cancer Early Detection Program declined 87 percent for breast cancer and 84 percent for cervical cancer during April 2020 compared numbers for that month over the past five years.  The CDC attributes this to delayed in seeking care because of COVID-19.  Learn more here.

Food and Drug Administration


  • With improved access nation-wide to N95 masks, the FDA has revoked emergency use authorizations for certain respirators and decontamination systems.  See the FDA announcement.  The FDA also will hold a webinar to share information and answer questions about its revocation of EUAs for non-NIOSH-approved respirators and decontamination systems.  Go here to learn more about the webinar.

Health Policy News

  • The FDA has alerted users of Philips Respironics ventilators, BiPAP, and CPAP machines and their health care providers that Philips Respironics has recalled certain devices due to potential health risks.  Go here to see the FDA announcement.
  • The FDA has approved Rylaze (asparaginase erwinia chrysanthemi (recombinant)-rywn) as a component of a chemotherapy regimen to treat acute lymphoblastic leukemia and lymphoblastic lymphoma in adult and pediatric patients who are allergic to the E. coli-derived asparaginase products used most commonly for treatment.  Learn more here.
  • The FDA has released a Cyclospora prevention, response, and research action plan.  The plan focuses on improving prevention, enhancing response activities, and filling knowledge gaps to help prevent Cyclospora contamination of foods and to help prepare for responding to future outbreaks.  See the FDA announcement for more.

National Institutes of Health

  • The NIH announced that it is funding five additional projects to identify ways of safely returning students and staff to in-person school in areas with vulnerable and underserved populations. Learn more about the new projects and other NIH-funded projects with similar objectives in this NIH announcement.


  • FEMA has revised its COVID-19 funeral assistance policy to assist with COVID-19-related fatalities that occurred in the early months of the pandemic.  The change is intended to help families paying for funeral costs for people who died of COVID-19 but for which that cause of death was not noted on their death certificate.  Learn more from FEMA’s announcement of the change, which also has links to additional resources.

Stakeholder Events

Thursday, July 8 – HHS

HHS’s “We Can Do This” campaign is a national initiative to build confidence in COVID-19 vaccines and get more people vaccinated.  This campaign offers tailored resources and toolkits for stakeholders to use to provide COVID-19 vaccine information to at-risk populations.  CMS is partnering with the campaign to offer several webinars to walk through each toolkit and its resources and train community organizations, local voices, and trusted leaders to use the campaign tools for vaccine outreach efforts to diverse communities.  A webinar will be held on Thursday, July 8 at 1:00 p.m. (eastern)  Register here.

Wednesday, Thursday, and Friday, July 7, July 8, and July 9 CMS

CMS – Revisions to the Healthcare Common Procedure Coding System (HCPCS) Code Set.

CMS will hold virtual meetings on July 7, 8, and 9, to discuss its preliminary coding recommendations for revisions of the HCPCS Level II code set.  For information about times, registration, submission of materials, signing up to speak, and submitting comments, click here.

Wednesday, July 8 – HHS – Provider Relief Fund

HHS will host a webcast on Wednesday, July 8 at 3:00 p.m. (eastern) to present updated information on the use of Provider Relief Fund grants and reporting and auditing requirements associated with the receipt and use of those grants.  Go here to register.

Tuesday, July 13 – Food and Drug Administration

The FDA will host a webinar to share information and answer questions about its revocation of EUAs for non-NIOSH-approved respirators and decontamination systems.  It will present information about its June 30, 2021 “Update:  FDA No Longer Authorizes Use of Non-NIOSH-Approved or Decontaminated Disposable Respirators – Letter to Health Care Personnel and Facilities.”  To join the webinar:

Zoom Webinar Link: Link Disclaimer

Webinar Passcode: $vrC6z

Dial: 833-568-8864
Webinar ID: 160 097 1341
Passcode: 292602

Tuesday, July 13 Office of the National Coordinator for Health Information Technology (ONC)
ONC Workshop: Advancing SDOH Data Use and Interoperability for Achieving Health Equity
Tuesday, July 13 at 10:00 am – 4:00 pm ET  Click here for connection information
This workshop will explore existing and emerging data standards, tools, approaches, policies, models, and interventions for advancing the use and interoperability of non-clinical health data for individual and community health improvement.  It will share varying perspectives of health policy-makers and health improvement implementers to highlight inventive solutions, share challenges, and offer ideas on data modernization to advance health equity.  The workshop offers introductory content as well as deep exploration of key topics as part of social determinants of health IT data use and interoperability including facilitated, expert stakeholder engagement.


NASH Comments on Proposed Changes in S-10 Uncompensated Care Reporting

NASH has expressed support for several new federal proposals on hospital uncompensated care data reporting and conveyed its opposition to other proposed changes in federal data collection requirements in a new letter to the Centers for Medicare & Medicaid Services.

In response to changes CMS has proposed in the uncompensated care data hospitals must submit to the federal government, NASH expressed:

  • Support for CMS’s proposal to clarify aspects of how hospitals must report data on the uncompensated care they provide on the Medicare cost report’s S-10 form.
  • Expressed concern that some of the new data reporting requirements violate current HIPAA requirements.
  • Asked CMS to defer reporting on the rates hospitals negotiate with Medicare Advantage plans until after the end of the COVID-19 public health emergency.

NASH is especially interested in proposed changes in uncompensated care data reporting on the S-10 form because that form is used in the calculation of private safety-net hospitals’ Medicare disproportionate share payments (Medicare DSH).  Those Medicare DSH payments are a vital tool in helping these hospitals serve the low-income and uninsured residents of the communities in which they are located.

Learn more about NASH’s response to CMS’s proposed new information collection activities in this NASH letter to CMS.

CMS Finalizes FY 2021 Payments to Hospitals

Medicare has announced how it will pay hospitals for inpatient care in FY 2021 with publication of its annual inpatient prospective payment system regulation last week.

Among the changes announced by the Centers for Medicare & Medicaid Services:

  • A 2.9 percent increase in fee-for-service inpatient rates.
  • A compromise on its proposal to require hospitals to report their payer-specific negotiated rates with Medicare Advantage plans.
  • Changes in how Medicare will calculate Medicare disproportionate share (Medicare DSH) uncompensated care payments.
  • A much smaller cut than originally proposed in the pool of funds for Medicare DSH uncompensated care payments.  Medicare DSH uncompensated care payments are especially important to private safety-net hospitals.
  • Minor adjustments in the Medicare area wage index system.
  • Refinements in the Medicare graduate medical education program.
  • A new DRG for CAR T-cell payments and a new pathway to Medicare add-on payments for FDA-approved antimicrobial products.

Learn more from CMS’s fact sheet or see the final regulation itself.

Feds Propose Changing Medicare DSH Calculation

Medicare DSH payments would reflect hospitals’ Medicare Advantage inpatient days under a new regulation proposed by the Centers for Medicare & Medicaid Services.

Under the newly proposed rule, the formula for calculating Medicare disproportionate share payments would incorporate hospitals’ Medicare Advantage inpatient days and not just their fee-for-service inpatient days.

Medicare DSH payments are made to hospitals that serve especially high proportions of low-income and uninsured patients and are intended to help them with the cost of providing those services.  All private safety-net hospitals qualify for Medicare DSH payments and consider the program an essential tool in their efforts to serve their communities.

The National Alliance of Safety-Net Hospitals will review the proposed regulation and model its potential impact on private safety-net hospitals.  As appropriate, NASH also will submit formal comments to CMS.

Go here to see the proposed regulation.


NASH Comments on Proposed Changes in Medicare Payments

NASH has submitted formal comments to the Centers for Medicare & Medicaid Services in response to CMS’s proposed FY 2021 Medicare inpatient prospective payment system regulation.

In its letter, NASH addressed six specific aspects of the proposed rule:

  • Medicare disproportionate share (Medicare DSH) proposals
  • The Medicare area wage index
  • Negotiated rate reporting
  • Medicare bad debt policy
  • Medicare graduate medical education policy
  • CAR-T cell therapy payments

Of particular note, NASH maintained that instead of decreasing the size of the pool of money for Medicare DSH uncompensated care payments, CMS should actually increase that pool in anticipation of increased hospital inpatient volume in FY 2021 – and increased hospital uncompensated care – as people return to hospitals for non-emergency procedures delayed by the COVID-19 emergency.

NASH also conveyed its opposition to the methodology CMS proposes using to calculate Medicare DSH uncompensated care payments, suggesting an alternative approach that makes better use of more current, more accurate data in that calculation.

Medicare DSH and Medicare DSH uncompensated care payments are especially important to private safety-net hospitals because those hospitals care for so many low-income, low-income elderly, and uninsured patients.

Read NASH’s comment letter to CMS here.

NASH Asks Senate for COVID-19 Help

Private safety-net hospitals need help with the challenges posed by the COVID-19 public health emergency, NASH wrote yesterday in a letter to Senate majority leader Mitch McConnell and minority leader Charles Schumer.

In its letter, NASH asked for:

  • An additional $100 billion for hospitals.
  • Forgiveness for money provided to hospitals through the federal CARES Act’s Accelerated and Advance Payment Program.
  • Action to prevent implementation of the Medicaid fiscal accountability regulation.
  • An increase in the federal Medicaid matching rate (FMAP).
  • An increase in states’ Medicaid disproportionate share (Medicaid DSH) allotments.
  • A moratorium on changes in hospital eligibility for the 340B prescription drug discount program, Medicare indirect medical education program, Medicare disproportionate share (Medicare DSH) program, and other programs.

See NASH’s letter here.


NASH Raises Concerns About Proposed Budget in News Release

Medicare and Medicaid cuts detailed in the administration’s proposed FY 2021 budget could be harmful to private safety-net hospitals, the National Alliance of Safety-Net Hospitals declared in a news release issued in response to that proposed budget.

Among those cuts:  $465 billion in Medicare payments and $920 billion in Medicaid reductions over the next ten years.

“The extent of the proposed spending cuts is daunting,” said Ellen Kugler, NASH’s executive director.  “The payments that have been targeted for the biggest cuts are the very payments that enable safety-net hospitals to provide vital services to their communities.  Without them, the capacity of private safety-net hospitals across the country to continue serving the low-income, low-income elderly, uninsured, and medically vulnerable residents of their communities could be in serious jeopardy.”

Among the payments targeted for major cuts are Medicare disproportionate share (Medicare DSH), Medicaid disproportionate share (Medicaid DSH), Medicare graduate medical education payments, Medicare bad debt reimbursement, and payments for some Medicare-covered outpatient services.

Learn more about NASH’s objections to the proposed cuts in this NASH news release.

NASH Unveils 2020 Advocacy Agenda

The National Alliance of Safety-Net Hospitals has published its 2020 advocacy agenda.

To advance the interests of private safety-net hospitals, in the coming year NASH will:

  • Continue to address the major policy challenges of 2019 that had not been resolved as that year ended:  an extended delay of Medicaid disproportionate share (Medicaid DSH) cuts, surprise medical bills, and prescription drug prices.
  • Respond to administration-driven policies such as the calculation of Medicare disproportionate share (Medicare DSH) payments, reduced payments for prescription drugs under the 340B prescription drug discount program, and efforts to reduce Medicaid eligibility and benefits and to limit the means through which states may finance their share of Medicaid payments.
  • Respond to expected judicial decisions addressing the extension of site-neutral Medicare outpatient payments to additional outpatient settings and the implementation of a new public charge regulation.

For a more detailed look at NASH’s advocacy plans for the coming year, see its complete 2020 advocacy agenda.

NASH Comments on Proposed Medicare Regulation (Part 2 of 3)

The National Alliance of Safety-Net Hospitals has submitted formal comments to the Centers for Medicare & Medicaid Services in response to the latter’s proposed hospital payment plan for FY 2020.

Responding to the proposed inpatient prospective payment system published by CMS in April, NASH primarily addressed a CMS proposal to change how it calculates Medicare disproportionate share (Medicare DSH) uncompensated care payments and proposed changes in the Medicare area wage index system.

Yesterday, the NASH blog presented the alliance’s written comments about proposed changes in Medicare DSH uncompensated care payments.  Today, it presents a detailed alternative proposal to CMS’s April 2019 recommendation for calculating those payments.  On Thursday the blog presents NASH’s response to proposed changes in the Medicare area wage index system.  The complete NASH response to the proposed CMS regulation can be found here.

Calculation of Medicare DSH Uncompensated Care Payments for FY 2020

Factor 3 represents a hospital’s share (as estimated by the Secretary) of the total uncompensated care provided by all hospitals eligible to receive DSH payments.  CMS has, in recent years, calculated UCC DSH payments using an average of three factor 3 calculations subject to a budget neutrality adjustment that modifies the average factor 3 for each hospital to spend the appropriate amount of money (i.e., factor 1 times factor 2) for the fiscal year.

For the reasons stated in the accompanying comment letter, NASH recommends that for FY 2020, CMS implement year one of a three-year transition to using a three-year average of audited post-transmittal 11 data.  The schedule for this transition would be as follows:

  • Year one (FY 2020) would consist of a blend of 2/3 of a hospital’s 2019 UCC DSH payment with 1/3 of the hospital’s UCC DSH payment based on unaudited 2017 S-10 data. During FY 2020, CMS could engage in audits of the 2017 data.
  • Year two (FY 2021) would consist of a blend of 1/3 of a hospital’s 2019 UCC DSH payment with 2/3 of the hospital’s UCC DSH payment based on the average factor 3 derived from the hospital’s audited 2017 data and unaudited 2018 data. During FY 2021, CMS could engage in audits of the 2018 data.
  • Year three (FY 2022) would consist of an equally weighted blend of the hospital’s audited 2017 and 2018 data and unaudited 2019 data.

Each year thereafter, CMS could continue to engage in audits while rolling forward the three-year average, adding a new year of data to the calculation and dropping the oldest year of data.  The result balances timeliness and accuracy while also maintaining year-over-year stability.

Specifically, for FY 2020, a hospital’s final factor 3 would be calculated by:

  • Calculating for each hospital a preliminary 2017 factor 3 by dividing the hospital’s reported line 30 uncompensated care (subject to any adjustments or trims) by the total reported line 30 uncompensated care (subject to any adjustments or trims) reported by all hospitals expected to receive DSH in FY 2020 on their 2017 cost reports.
  • Calculating for each hospital a blended FY 2020 factor 3 by summing the hospital’s preliminary 2017 factor 3 plus its FY 2019 final factor 3 plus its FY 2019 final factor 3 and dividing by 3 if the hospital received a payment in 2019 and 1 if the hospital received no payment in 2019.
  • Deriving a standardization factor by calculating the average factor 3 for all hospitals projected to receive DSH and dividing the result by 1.0.
  • Calculating each hospital’s final FY 2020 factor 3 by multiplying its blended FY 2020 factor 3 by the standardization factor.

Puerto Rico hospitals, Indian Health Service and Tribal hospitals would continue receive a factor 3 based on low-income insured days from FY 2013.

For 2021, each hospital’s factor three would be based on the three-year average of its 2019 final factor 3, its 2017 factor 3 and its 2018 factor 3.

*          *          *

Tomorrow, see NASH’s comments on CMS’s proposal for changes in the Medicare geographic wage classification system.

See NASH’s entire response to the proposed Medicare regulation here.

More Potential Budget Obstacles for Private Safety-Net Hospitals

Part two of the Trump administration’s proposed FY 2020 budget brought more potential bad news for private safety-net hospitals.


Last week’s “lean budget” released by the White House included a number of challenges for private safety-net hospitals and this week’s release, intended to fill in some of the blanks that last week’s document left, brought more of the same.

Proposed Medicare challenges include:

  • a call for establishing a new process for calculating Medicare disproportionate share (Medicare DSH) uncompensated care payments
  • slashing Medicare bad debt reimbursement from 65 percent to 25 percent
  • continued movement toward site-neutral payments for outpatient services provided at hospital outpatient facilities

Newly proposed Medicaid challenges include:

  • extending Medicaid disproportionate share (Medicaid DSH) cuts beyond the currently planned six years
  • redesigning the formula for allocating Medicaid DSH funds to the states
  • authorizing states to verify beneficiaries’ Medicaid eligibility more than once a year
  • permitting states to apply means tests to Medicaid eligibility

The latest FY 2020 budget proposal also calls for:

  • consolidating Medicare, Medicaid, and children’s hospital medical education payments into single new capped medical education grant program
  • reduced 340B prescription drug discount program payments for some hospitals
  • reducing the grace period for payment of premiums for health insurance purchased on an insurance exchange
  • income-based increases in premiums for low-cost insurance purchased on those exchanges

All of these changes, if implemented, would pose problems for NASH members and most private safety-net hospitals.

Learn more from this week’s White House budget document.