Budget Blog

May 7, 2020 - Health Care Issues Update

By Stacey Mazer posted 05-07-2020 03:05 PM


CMS Releases Additional Frequently Asked Questions for Medicaid and CHIP

The Centers for Medicare and Medicaid Services (CMS) released additional Frequently Asked Questions (FAQs) for Medicaid and the Children’s Health Insurance Program (CHIP). The new FAQs cover a variety of Medicaid and CHIP topics, including emergency preparedness and response, eligibility and enrollment flexibilities, benefit flexibilities, cost-sharing flexibilities, financing flexibilities, managed care flexibilities, information technology, and data reporting. This document consolidates previously released guidance and includes a table of contents for an easier way to review the array of topics covered.


HHS Makes Provider Relief Awards to High-Impact Hospitals and Rural Providers

The Department of Health and Human Services (HHS) announced it began processing payments from the Provider Relief Fund to hospitals with large numbers of COVID-19 cases through April 10 and to rural providers. The department is distributing $12 billion to 395 hospitals who provided inpatient care for 100 or more COVID-19 patients, $2 billion of which will be distributed to these hospitals based on their Medicare and Medicaid disproportionate share and uncompensated care payments. HHS is also distributing $10 billion to rural acute care general hospitals and Critical Access Hospitals, Rural Health Clinics, and Community Health Centers located in rural areas. The state and county breakdowns can be found here. The National Academy for State Health Policy (NASHP), in consultation with state officials, has drafted a template that states can use or revise to seek timely information detailing which hospitals are already receiving federal coronavirus relief funds.


HHS Awards Funds to Health Centers to Expand COVID-19 Testing

The Department of Health and Human Services (HHS), through the Health Resources and Services Administration (HRSA), awarded nearly $583 million to 1,385 HRSA-funded health centers in all states, the District of Columbia, and eight U.S. territories to expand COVID-19 testing. Health centers are currently providing more than 100,000 weekly COVID-19 tests in their local communities and HRSA-funded health centers will use this funding to expand the range of testing and testing-related activities.


How Health Care Costs May Change from COVID-19

This brief by the Peterson Center on Healthcare and the Kaiser Family Foundation lays out a framework for understanding changes in health costs arising from the coronavirus pandemic, including the factors driving both health cost increases and decreases, and highlights some special considerations for private insurers, Medicare, and Medicaid programs. The most direct impact the coronavirus pandemic will have on U.S. health care spending is through testing and treatment of COVID-19, but the extent of upward pressure on health costs depends on a number of still unknown factors. Medicaid program costs are expected to increase as a result of dealing with COVID-19 because of the cost of treating currently enrolled patients with COVID-19 and because overall enrollment is expected to rise as unemployment increases and people lose their job-based coverage. Similar to other payers, Medicaid programs may see some declines in utilization of non-urgent care. However, unlike other payers, a larger share of Medicaid spending may continue since a majority of spending is for the low-income elderly and people with disabilities, including spending for long-term services and supports that cannot easily be deferred. 


CMS Releases Interim Final Rule to Provide Additional Flexibilities  

The Centers for Medicare and Medicaid Services (CMS) released this interim final rule with comment period to provide additional flexibilities to individuals and entities that provide services to Medicare, Medicaid, Basic Health Programs, and Exchange beneficiaries. Several Medicaid and Basic Health Program (BHP) regulatory updates in the interim final rule address laboratory services flexibility, home health expansions, and flexibility for BHP Blueprint revisions.


Results from a State Medicaid Pharmacy Survey for Fiscal Years 2019 and 2020

The Kaiser Family Foundation and Health Management Associates conducted a survey of all states and the District of Columbia to better understand how the Medicaid pharmacy benefit is administered. Medicaid drug spending growth has slowed, after seeing a sharp spike in 2014 due to specialty drug costs and coverage expansion under the Affordable Care Act. However, state policymakers remain concerned about Medicaid prescription drug spending as spending is expected to grow in future years. Due to Medicaid’s role in financing coverage for high-need populations, it pays for a disproportionate share of some high-cost specialty drugs. In addition, Medicaid is required to cover the blockbuster drugs increasingly entering the market as a result of the structure of the pharmacy benefit. The survey looks at states’ use of the array of payment strategies and utilization controls to manage pharmacy expenditures including preferred drug lists, exploring value-based arrangements, and carving out high-cost drugs from managed care.