Budget Blog

August 20, 2020 - Health Care Issues Update

By Stacey Mazer posted 08-20-2020 12:00 AM


HHS Announces $1.4 Billion Distribution to Children’s Hospitals

The Department of Health and Human Services (HHS), through the Health Resources and Services Administration (HRSA), announced an additional $1.4 billion in targeted distribution funding to almost 80 free-standing children’s hospitals. According to the press release, this distribution will help ensure children’s hospitals receive relief proportional to other hospitals, with funding distributed from the $175 billion Provider Relief Fund. Qualifying free-standing children’s hospitals must either be an exempt hospital under the Centers for Medicare and Medicaid Services (CMS) inpatient prospective payment system or be a HRSA defined Children’s Hospital Graduate Medical Education facility. The facilities will be eligible for grants of 2.5 percent of their net patient revenues. Qualifying free-standing children’s hospitals will begin receiving funds next week. A preliminary state-by-state breakdown can be found here.


CMS Announces New Rural Health Payment Model

The Centers for Medicare & Medicaid Services (CMS) Innovation Center announced the  Community Health Access and Rural Transformation (CHART) Model, which aims to provide a way for rural communities to transform their health care delivery systems. CMS is providing funding for rural communities to build systems of care through a Community Transformation Track and is enabling providers to participate in value-based payment models where they are paid for quality and outcomes, instead of volume, through an Accountable Care Organizations (ACO) Transformation Track. The CHART ACO will enter into participation agreements with CMS to participate in both the Shared Savings Program and the CHART Model and must meet the requirement that a majority of its ACO providers and suppliers are located within rural counties or census tracts.  CMS anticipates the Notice of Funding Opportunity for the Community Transformation Track will be available in September and the Request for Application for the ACO Transformation Track will be available in early 2021.


Implementation of the CMS Interoperability and Patient Access Final Rule

The Centers for Medicare & Medicaid Services (CMS) released a letter to state health officers describing how state Medicaid agencies should implement the CMS Interoperability and Patient Access final rule in a manner consistent with existing guidance. The letter discusses provisions in the final rule which affect Medicaid agencies, Medicaid managed care plans, the Children’s Health Insurance Program (CHIP), and CHIP managed care entities. CMS published the Interoperability and Patient Access final rule on May 1, 2020. Additionally, the letter advises states to be aware of the Office of National Coordinator’s 21st Century Cures Act final rule on information blocking.


CMS Guidance on Third-Party Payments for Medicaid Eligible or Uninsured Individuals

The Centers for Medicare & Medicaid Services (CMS) released guidance for states on how they can treat certain third-party payments for Medicaid eligible or uninsured individuals when reporting data to the agency. These third-party payments factor into the Uncompensated Care Costs (UCC) data that is used by CMS when calculating the hospital-specific limits for Medicaid Disproportionate Share Hospital (DSH) payments. This bulletin outlines the two methods that CMS is recommending for states.