McDermottPlus Check-Up: June 05, 2020 - McDermott+Consulting

McDermottPlus Check-Up: June 05, 2020

This Week’s Dose: House Republicans released proposals to support coronavirus (COVID-19) testing, and the Center for Medicare and Medicaid Innovation (CMMI) released new flexibilities for numerous value-based payment models.


Congress Eyes July for Next Relief Bill. Last week, the House of Representatives issued its revised calendar for the remainder of the year. The congressional schedule has been unpredictable up to this point, with leadership making frequent last-minute decisions to call members back to Washington. The published schedule indicates that the House is trying to settle into its new normal. According to the calendar, the entire month of June is designated for committee activity. Members will likely hold remote committee hearings focused on oversight of the government’s COVID-19 response. With the chamber’s adoption of proxy voting, members will have no reason to return to Washington until work begins in earnest on the next relief package. The House calendar and statements from Senate leadership indicate this will likely be July at the earliest.

House Republicans Issued Proposals for COVID-19 Testing. Republicans on the House Energy and Commerce Committee released a series of recommendations that call for testing to be directed toward vulnerable populations at the highest risk for infection, including nursing community residents, healthcare facility workers, meat and poultry packing workers, and minority communities. The plan also recommends that Public Health Laboratories be modernized to provide access to high throughput testing equipment, similar to what large commercial laboratories have. This proposal follows a report released by the Department of Health and Human Services (HHS) last week, which outlined the Administration’s goals for increasing the nation’s testing capacity. The Energy and Commerce Republicans’ recommendations broadly align with the Administration’s strategy, leaving most of the responsibility and authority for testing to states. Senate Democrats released a proposal on April 15 to bolster COVID-19 testing, which calls for a more centralized approach coordinated by the federal government.


CMMI Announced Payment Model Flexibilities. CMMI released new flexibilities and adjustments for many of its payment models to help protect model participants during the COVID-19 pandemic. A comprehensive table detailing the announced flexibilities for each of the payment models is available here, and a blog post from Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma announcing these changes is available here. Significantly, many of the new models, including Direct Contracting and Kidney Care Choices, are slated to begin on April 1, 2021. Primary Care First will begin January 1, 2021, except for the Serious Illness component, which will begin April 1, 2021. In addition, the Next Generation Accountable Care Organization model is extended an additional year, through the end of 2021. In the announcement, CMMI states it will release additional model-specific flexibilities as information becomes available. The COVID-19 pandemic has underscored the weaknesses of Medicare’s fee-for-service (FFS) payment model, with many FFS providers facing significant financial shortfalls. This week’s announcement demonstrates the Administration’s desire to continue to move providers away from FFS, toward capitated payment models that could provide more stable cash flow.

CMS Released Data on Nursing Home Facilities and Announced Enhanced Enforcement Measures. CMS released a report showing that nearly 26,000 nursing home residents and staff have died from COVID-19, which has swept through long-term care facilities. According to CMS, the virus has infected more than 60,000 long-term care residents and 34,000 staff. CMS also posted state-by-state data on nursing home cases and deaths, showing the highest rates of incidence in Connecticut, Massachusetts, New York, New Jersey, and Washington, DC. In the past month, CMS has required enhanced reporting of COVID-19 data from nursing facilities, with increased penalties for facilities that fail to meet transparency or virus mitigation requirements. Following the report, CMS announced that it will increase civil monetary penalties for nursing homes with persistent infection control violations. In addition, CMS will distribute $80 million provided by the CARES Act for states to conduct surveys of nursing homes based on performance metrics. States that do not complete required surveys will face a reduction in their portion of the CARES Act funding. The agency also sent a letter to governors urging them to target testing efforts to nursing communities.

Provider Relief Fund Updates

  • HHS updated the Provider Relief Fund FAQs to provide additional clarity on items and services that count as “lost revenues” attributable to COVID-19, and therefore can be covered using payments from the Fund. Keep in mind that all providers are also required to comply with the Terms & Conditions specific to each distribution stream.
  • The Centers for Disease Control and Prevention (CDC) updated its dataset of the healthcare entities who have agreed to the Terms and Conditions and received claims reimbursement for testing or treatment of uninsured COVID-19 patients.
  • Bipartisan leadership from the Senate Finance and House Energy and Commerce committees sent a letter urging HHS to improve its pace in making distributions from the Provider Relief Fund specifically for Medicaid-dependent providers. Lawmakers join stakeholders who are becoming increasingly frustrated with the amount of time it has taken to get relief to some of the most vulnerable safety net providers. It has been 70 days since the CARES Act funded the Provider Relief Fund.

Our toolkit assembles resources related to the Provider Relief Fund all in one place.

Quick Hits

  • The House Energy and Commerce, Senate Finance, and House Appropriations committees held hearings on governors’ response to COVID-19, the Food and Drug Administration’s foreign drug manufacturing inspection process, and CDC’s efforts surrounding the pandemic.
  • Democratic leaders of the House Coronavirus Committee and House Oversight Committee sent a letter demanding information from HHS on the government’s vaccine development contracts with drug companies.
  • Senator Patty Murray (D-WA), Ranking Member of the Senate Health, Education, Labor and Pensions (HELP) Committee, sent a letter seeking information on the Administration’s decision to contract with a private company to collect COVID-19 data.
  • The Congressional Budget Office estimates that the HEROES Act (H.R. 6800), House Democrats’ opening bid for the next COVID-19 relief package, would cost approximately $3.5 trillion over 10 years, far surpassing the scale of the CARES Act, which is, to date, the largest government stimulus package ever enacted.
  • HHS announced the distribution of $250 million to help hospitals and other entities train workforces, expand telemedicine, and procure supplies to respond to COVID-19.
  • CMS released guidance to help states implement the Optional COVID-19 Testing (XXIII) Group­­­ for uninsured individuals established by the Families First Coronavirus Response Act.
  • HHS released new guidance for laboratories specifying what additional data must be reported along with COVID-19 test results.
  • The HHS Office of Inspector General released its semiannual report to Congress documenting its COVID-19 pandemic activities.
  • The Government Accountability Office published a report identifying current federal policies that create program administrative challenges for state Medicaid officials.

M+ Resources

  • The 2020 presidential election is five months away. On this week’s episode of the Health Policy Breakroom, our consultants discuss how COVID-19 has shifted the dynamics of the race.
  • The federal response to COVID-19 includes several financial relief opportunities for healthcare providers. Our chart highlights the primary funding streams available.
  • Find all McDermottPlus analysis related to COVID-19 on our COVID-19 Resource Center.

Next Week’s Diagnosis:  The Senate HELP Committee will hold a hearing on going back to school safely. We continue to watch for HHS to distribute more money from the Provider Relief Fund.


For more information, contact Mara McDermott, Rachel Stauffer or Emma Zimmerman.

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