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US Senate Adds $75 Billion to CARES Act Funding for Hospitals and Health Care Providers as HHS Announces Additional Funding Details

April 23, 2020

The U.S. Senate agreed on April 21 to add nearly $500 billion in additional funding for an interim coronavirus relief package. Dubbed “COVID 3.5,” the legislation was agreed to via unanimous consent in a pro-forma session, to prevent the need for the entire Senate to act on it. It is expected to gain approval soon from the U.S House of Representatives and President Trump.
While most of the funding will inject additional funds into the depleted Paycheck Protection Program for small businesses, an additional $75 billion was also added to the Public Health and Social Services Fund for hospitals and health care providers. That brings total funding for COVID relief for hospitals in this fund to $175 billion.
WHA has been strongly advocating for additional funding targeted toward hospitals and health systems to assist them with significant losses they are facing after heeding the CDC’s and U.S. Surgeon General’s recommendations in mid-March to pause elective surgeries and medical procedures. Wisconsin hospitals are estimated to be losing $265 million per week in operating revenue due to following this guidance. WHA has advocated that states receive this funding proportionally based on the amount of the U.S. population they serve to ensure states like Wisconsin are not shortchanged.
While the U.S. Dept. of Health and Human Services had previously distributed $30 billion from this pot based on a Medicare fee-for-service formula, they acknowledged on April 22 that this had been done only to get revenues out as quickly as possible. HHS also said that they would be rebasing those payments along with another $20 billion in payments to health care providers, so that providers would see payments from this $50 billion pot based on their percent of overall net operating revenue. HHS also announced additional distributions that would soon be coming from the CARES Act, including:
  • $10 billion for hospitals and providers based on their share of COVID patients treated as of April 10.
  • $10 billion for rural hospitals.
  • An unknown amount that would be used to pay providers Medicare rates for treating uninsured COVID patients.
  • Future amounts for additional providers such as nursing homes, dentists, and Medicaid-only providers.

While it is unclear how the additional $75 billion will be distributed, HHS said in a call on April 22 that they intend to base all distributions going forward on the principles of getting payments out quickly in a fair, equitable and transparent manner. WHA will continue advocating to Wisconsin’s Congressional Delegation and the Trump administration that future distribution formulas take into consideration impacts on Wisconsin.

This story originally appeared in the April 23, 2020 edition of WHA Newsletter