Bill to Avert Government Shutdown Extends Important Health Care Programs

October 01, 2020

Late on September 30, the last day of the federal fiscal year, the United States Senate passed, and President Donald Trump quickly signed a bill to avert a government shutdown and extend funding for federal programs through December 11, after the election. The bill, which was passed by the U.S. House of Representatives last week, includes funding extensions of important health care programs and additional flexibility for Medicare Advance and Accelerated Payments.
Medicare Advance and Accelerated Payment loans were made to hospitals and other Medicare providers early during the COVID-19 pandemic with the expectation that the providers would start paying them back within six months and eventually at a more than ten percent interest rate. The U.S. Department of Health and Human Services, however, delayed recoupments, expecting that Congress may agree to provide more flexibility.

The new legislation provides the following changes to repayment terms:

  • Recoupment starts 12 months after payments have been received.
  • Additionally, it will be only at 25 percent instead of 100 percent of Medicare claims for the first 11 months. 
  • For the next six months, any remaining balances are recouped at 50% 
  • After this, any remaining balance must be paid back at a 4% interest rate. 
  • Altogether, interest would begin to accrue 29 months from the date of the loan. 
In addition to flexibilities on these loans, the legislation included funding for certain health care programs that were slated to expire on November 30:
  • Medicare Extenders. The legislation extends the Work Geographic Practice Cost Index floor under the Medicare program; funding for the National Quality Forum to conduct quality measure endorsement, input, and selection; and funding for outreach and assistance for low-income programs.
    • Medicaid Disproportionate Share Hospital (DSH) Payments.
    The legislation delays through December 11, 2020, the start of the $4 billion in fiscal year 2021 Medicaid DSH cuts scheduled to go into effect December 1, 2020.
    • Other Medicaid Extenders. The legislation extends the Money Follows the Person Rebalancing Demonstration Program, the Community Mental Health Services Demonstration Program and the spousal impoverishment protections under the Medicaid program.
    • Other Extenders. The legislation extends funding and authorization for a number of other health care programs, including community health centers, teaching health centers, and the National Health Service Corp.
Contact WHA Vice President of Federal and State Relations, Jon Hoelter with questions.

This story originally appeared in the October 01, 2020 edition of WHA Newsletter