/ en Sat, 26 Apr 2025 01:24:19 -0500 Wed, 26 Jul 23 06:00:00 -0500 /public-comments/2023-07-26-aha-statement-record-house-ways-and-means-committee-july-26-2023 <div class="container"> <div class="row"> <div class="col-md-8"> <p>On behalf of our nearly 5,000 member hospitals, health systems and other health care organizations, our clinician partners — including more than 270,000 affiliated physicians, 2 million nurses and other caregivers — and the 43,000 health care leaders who belong to our professional membership groups, the ���������� Association (AHA) writes to share the hospital field’s comments on legislative proposals that are to be considered before the Committee on Ways and Means on July 26. We would like to provide feedback on sections of H.R. 4822, the “Health Care Price Transparency Act of 2023,” as well as H.R. 3284, the “Providers and Payers COMPETE Act.”</p> <h2>Health Care Price Transparency Act of 2023</h2> <h3>Parity in Medicare Payments for Hospital Outpatient Department Services Furnished Off-campus</h3> <p>The AHA opposes Section 203, which would create harmful site-neutral payment cuts for drug administration services furnished in off-campus HOPDs. This policy would result in a major cut to HOPDs that provide essential drug administration services to patients, including for vulnerable cancer patients, who may require a higher level of care than is available at other care settings.</p> <p>Site-neutral payment policies fail to account for the fundamental differences between HOPDs and other sites of care. Hospitals and health systems are held to higher regulatory and safety standards than other settings, including for drug administration services. Current payment rates support this higher standard of care to ensure that drugs are safely prepared and administered. For example, unlike independent physicians’ offices, hospitals must take steps to ensure the drug preparation is supervised by a licensed pharmacist, employees are protected from exposure to hazardous drugs, rooms are sterilized to prevent contamination, and that they are compliant with other such Food and Drug Administration, U.S. Pharmacopeia and Joint Commission safety standards.</p> <p>The cost of care delivered in hospitals and health systems considers the unique benefits that they provide to their communities that are not provided by other sites of care. This includes investments made to maintain standby capacity for natural and manmade disasters, public health emergencies and unexpected traumatic events, as well as delivering 24/7 emergency care to all who come to the hospital, regardless of ability to pay or insurance status. In addition, hospital facilities also must comply with a much more comprehensive scope of licensing, accreditation and other regulatory requirements compared to other sites of care. These costs can amount to over $200 per patient, resulting in hospitals losing money when providing certain services.</p> <p>Existing site-neutral payment cuts have already had a significantly negative impact on the financial sustainability of hospitals and health systems and have contributed to Medicare’s chronic failure to cover the cost of caring for its beneficiaries. Medicare only pays 84 cents for every dollar hospitals spend providing care to Medicare beneficiaries. Medicare outpatient margins were an average of -17.5% in 2021 and overall median hospital operating margins were negative throughout 2022 and into the beginning of 2023. The impact is perhaps even more acute for rural hospitals whose total Medicare margins were -17.8% in 2021. This is particularly alarming given the fact that 152 rural hospitals have closed or converted to another type of provider since 2010, with 11 occurring so far in 2023. This proposal would expand upon these cuts resulting in a cut of nearly $4 billion over 10 years to hospitals and health systems. This would further exacerbate the financial challenges facing many hospitals and threaten patients’ access to quality care.</p> <p>Some policymakers have inaccurately suggested that site-neutral payments are needed to disincentivize hospitals and health systems from acquiring physician practices. However, the reality is that over the past five years, entities like private equity firms and companies linked to commercial insurers, including UnitedHealth Group’s Optum Care and Humana, are responsible for over 75% of physician acquisitions, while hospitals and health systems only account for 6%.<sup><a href="#fn1">1</a></sup> Instead of allowing these services to be lost into the community or creating new health care deserts, hospitals acquire these practices to ensure that the health care services continue to exist and that patients can continue to receive their care from their existing doctors.</p> <h3>Requiring a Separate Identification Number and an Attestation for Each Off-campus Outpatient Department of a Provider</h3> <p>The AHA opposes Section 202, which would require that each off-campus hospital outpatient department (HOPD) of a provider be assigned a separate unique health identifier from its provider. This provision is unnecessary since hospitals are already transparent about the location of care delivery on their bills. Hospitals and other providers bill according to federal regulations, which require them to bill all payers — Medicare, Medicaid and private payers — using codes that indicate the location of where a service is provided. As a result, this provision would impose an unnecessary and onerous administrative burden on providers and needlessly increase Medicare program administrative costs.</p> <p>Section 202 also would require that as a condition of payment, hospitals submit an attestation of compliance with the Medicare provider-based regulations for each of their off-campus HOPDs within two years of enactment. Given hospitals’ experience with review and approval of similar attestations in the past, we are concerned that this requirement would be extremely burdensome for hospitals and Medicare contractors.</p> <h3>Price Transparency Requirements</h3> <p>Section 101 would require hospitals and ambulatory surgical centers to disclose certain information relating to charges and prices. For hospitals, this would consist of current requirements under the Hospital Price Transparency Rule, including a machine-readable file of the hospital’s standard charges, as well as to provide a list of at least 300 shoppable services. The legislation would allow hospitals to be deemed compliant with the shoppable service requirement if they have a price estimator tool until the No Surprises Act price transparency policies are fully implemented. The information posted would include the gross charges, the discounted cash price and allows the Department of Health and Human Services’ (HHS) Secretary the discretion to require hospitals to disclose negotiated rates. The secretary would establish, as of Jan. 1, 2026, a standard format for facilities to use in compiling and making public these standard charges and prices. The Centers for Medicare & Medicaid Services (CMS) would publish on their website information regarding the number of reviews conducted for hospital compliance, the number of notifications issued, the identity of hospitals that received notices, whether civil monetary penalties were imposed and whether a hospital subsequently came into compliance. Penalties are capped at $2 million per year per facility, which is similar to current CMS enforcement standards, but the Secretary is allowed to increase that amount for persistent noncompliance and could decrease that amount or waive it entirely for hospitals when the fine would pose a hardship.</p> <p>The AHA opposes the provision to eliminate the use of price estimator tools once the No Surprises Act price transparency Advanced Explanation of Benefit (AEOB) policies are in place. Requiring hospitals with price estimator tools to invest time and resources in creating a shoppable service list, in addition to complying with the AEOB, is a move in the wrong direction. This will create undue cost and burden in the health care system and could result in public confusion around which estimates patients should use in preparing for care. Also, given that CMS is contemplating changes to the existing Hospital Price Transparency regulations in the OPPS proposed rule, we are concerned that the legislative approach to price transparency outlined in Section 101 may conflict with new guidelines. Each time CMS makes changes to the underlying transparency program, hospitals must invest additional time and resources to come into compliance. It is essential that any legislative changes are made in accordance with the most current regulatory parameters to avoid confusion and burden for hospitals as they seek to adhere to both the regulations and any statutory changes.</p> <h3>Streamlining Prior Authorization in Medicare Advantage</h3> <p>The AHA is appreciative of efforts in Section 301 that would help ensure access to high quality care in a timely manner by streamlining prior authorization requirements under Medicare Advantage (MA) plans. This section would establish an electronic prior authorization process to increase transparency around which services require prior authorization, streamline approvals, reduce the amount of time a health plan is allowed to consider a prior authorization request, create a process of “real-time decisions” for services that are routinely approved, require MA plans to report on their use of prior authorization and the rate of approvals and denials, and encourage MA plans to adopt policies that adhere to evidence-based guidelines.</p> <p>However, hospitals should not have to endure site-neutral payment cuts to pay for insurer abuses. Inappropriate denials for prior authorization and coverage of medically necessary services are a pervasive problem among certain plans in the MA program. According to a 2022 American Medical Association survey, 94% of physicians reported patient care delays associated with prior authorizations, while 80% indicated that prior authorization hassles led to patient abandonment of treatment.<sup><a href="#fn2">2</a></sup> These practices add financial burden and strain on the health care system through inappropriate payment denials and increased staffing and technology costs to comply with MA plan requirements. They are also a major burden to the health care workforce and contribute to provider burnout.</p> <p>In addition to the provisions included in this section, we encourage the committee to broaden the scope of this bill to apply to state Medicaid and Children’s Health Insurance Program agencies and Qualified Health Plan issuers on the Federally-facilitated Exchanges to reflect the recently proposed rules released by CMS to improve the prior authorization process.</p> <h2>Medicare Sequestration</h2> <p>The AHA opposes Section 302, which would implement further additional Medicare sequester cuts to hospitals. Additional cuts to hospitals will only impede our ability to maintain access to care for the patients and communities we serve.</p> <p>After years of a once-in-a-lifetime global pandemic where hospitals and health systems treated more than six million COVID-19 patients while simultaneously dealing with near historic inflation, rising expenses for drugs, supplies and labor, and incredible workforce pressures, now is not the time to cut Medicare funding. According to the government’s own data, Medicare already chronically underpays providers for caring for patients, and it’s time for policymakers to acknowledge the enormous challenges facing hospitals and health systems today.</p> <h2>Providers and Payers Compete Act</h2> <p>The AHA opposes the Providers and Payers COMPETE Act (H.R. 3284), which would impose new regulatory responsibilities on HHS regarding consolidation. HHS is not charged with protecting competition and it lacks the necessary expertise in this area. These new responsibilities are unnecessary since two other federal agencies — the Department of Justice’s Antitrust Division and the Federal Trade Commission — already have jurisdiction over federal antitrust enforcement. These agencies routinely study, report on and take action to protect competition in the healthcare sector for the benefit of consumers.</p> <p>We urge Congress to reconsider this attempt to expand HHS’s mission and expend resources outside its core competency. Instead, the public will be best served if HHS focuses its efforts elsewhere, where its expertise and resources can benefit the consumers that rely on the programs it oversees.</p> <h2>Conclusion</h2> <p>Thank you for the opportunity to share the hospital and health system field’s perspective on health care price transparency with the committee. We look forward to continuing to work with you to address these important issues.</p> <hr> <ol> <li id="fn1"><a href="/infographics/2023-06-26-setting-record-straight-private-equity-and-health-insurers-acquire-more-physicians-hospitals">/infographics/2023-06-26-setting-record-straight-private-equity-and-health-insurers-acquire-more-physicians-hospitals</a></li> <li id="fn2"><a href="https://www.ama-assn.org/system/files/prior-authorization-survey.pdf" target="_blank">https://www.ama-assn.org/system/files/prior-authorization-survey.pdf</a></li> </ol> </div> <div class="col-md-4"> <p><a href="/system/files/media/file/2023/07/AHA-Statement-of-Record-for-House-Ways-and-Means-Committee-July-26-2023.pdf" target="_blank" title="Click here to download the AHA Statement of Record for House Ways and Means Committee July 26, 2023 PDF."><img alt="AHA Statement of Record for House Ways and Means Committee July 26, 2023 page 1." data-entity-type="file" data-entity-uuid="20a144ab-cfe7-4285-a81e-24030297f048" src="/sites/default/files/inline-images/Page-1-AHA-Statement-of-Record-for-House-Ways-and-Means-Committee-July-26-2023.png" width="692" height="900"></a></p> </div> </div> </div> Wed, 26 Jul 2023 06:00:00 -0500 Medicare Sequestration Payment Reductions /lettercomment/2022-11-30-aha-others-urge-congress-prevent-statutory-paygo-sequester-taking-effect <div class="container"> <div class="row"> <div class="col-md-8"> <p>November 30, 2022</p> <div class="row"> <div class="col-md-6"> <p>The Honorable Charles E. Schumer<br> Majority Leader<br> United States Senate<br> Washington, DC 20510</p> <p>The Honorable Nancy Pelosi<br> Speaker<br> U.S. House of Representatives<br> Washington, DC 20515</p> </div> <div class="col-md-6"> <p>The Honorable Mitch McConnell<br> Republican Leader<br> United States Senate<br> Washington, DC 20510</p> <p>The Honorable Kevin McCarthy<br> Republican Leader<br> U.S. House of Representatives<br> Washington, DC 20515</p> </div> </div> <p>Dear Leader Schumer, Leader McConnell, Speaker Pelosi and Leader McCarthy:</p> <p>The undersigned health care organizations are writing to urge Congress to prevent the Statutory Pay-As-You-Go Act of 2010 (Statutory PAYGO) sequester from taking effect at the end of this session of Congress.</p> <p>Like individuals and families across America, physicians, nurses, hospitals and health systems, long-term care hospitals, inpatient rehabilitation facilities, skilled nursing facilities, home health agencies and hospices are dealing with difficult challenges. These challenges include high inflation and significant increases in costs from workforce shortages, drugs, equipment and supplies (including food and energy costs) that threaten financial stability and the ability to provide access to high-quality health care services. This is exacerbated by supply chain shortages, backlogs in deferred care and government underpayment.</p> <p>Failure to waive Statutory PAYGO sequester cuts would result in $38 billion in Medicare cuts in fiscal year 2023 which would have a devastating impact on the health care field, destabilizing health care access.</p> <p>In previous years Congress has stepped in to pass legislation to avoid triggering PAYGO. Congress once again needs to waive these cuts, to prevent them from taking effect in 2023. We urge Congress to prevent these cuts. Now is not the time for reductions in Medicare payments to providers.</p> <p>Congress must enact into law provisions to prevent a Statutory PAYGO sequester from taking effect at the end of this session of Congress, preventing 4% cuts to Medicare from taking effect so our nation’s health care providers can continue to care for patients, families and communities.</p> <p>Sincerely,</p> <p>���������� Association<br> American Medical Association<br> American Health Care Association<br> National Association for Home Care & Hospice<br> National Hospice and Palliative Care Organization<br> Association for Clinical Oncology<br> AdvaMed</p> </div> <div class="col-md-4"> <div class="external-link spacer"><a class="btn btn-wide btn-primary" href="/system/files/media/file/2022/11/Statutory-PAYGO-Coalition-Letter-113022.pdf" target="_blank" title="Click here to download the AHA, Others Urge Congress to Prevent the Statutory PAYGO Sequester from Taking Effect letter PDF.">Download the PDF</a></div> <p><a href="/system/files/media/file/2022/11/Statutory-PAYGO-Coalition-Letter-113022.pdf" target="_blank" title="Click here to download the AHA, Others Urge Congress to Prevent the Statutory PAYGO Sequester from Taking Effect letter PDF."><img alt="AHA, Others Urge Congress to Prevent the Statutory PAYGO Sequester from Taking Effect letter." data-entity-type="file" data-entity-uuid="78134783-39ec-4431-a746-829080313dfb" src="/sites/default/files/inline-images/Statutory-PAYGO-Coalition-Letter-113022_0.png" width="695" height="900"></a></p> </div> </div> </div> Wed, 30 Nov 2022 07:00:00 -0600 Medicare Sequestration Payment Reductions /fact-sheets/2022-09-13-fact-sheet-medicare-sequester-relief-extension-needed-health-providers <div class="container"><div class="row"><div class="col-md-8"><h2>The Issue</h2><p>The COVID-19 pandemic and its aftermath have resulted in historic challenges for hospitals and health systems and the communities they serve in terms of recovery and rebuilding, placing unprecedented stress on the entire health care system and its financing. Like individuals and families across America, hospitals and health systems are dealing with the difficult challenges of high inflation and significant increases in costs from workforce shortages, drugs, equipment and supplies (including food and energy costs) that threaten financial stability and the ability to provide access to high-quality health care services. This is exacerbated by supply chain shortages, managing a backlog in deferred care and navigating government underpayment.</p><p>The Budget Control Act of 2011 requires, among other things, mandatory across-the-board reductions in certain types of federal spending, also known as sequestration. Medicare claims with dates-of-service or dates-of-discharge on or after April 1, 2013, incur a 2% reduction in Medicare payment.</p><p>The Coronavirus Aid, Relief, and Economic Security (CARES) Act, signed into law in March 2020, included critical relief from sequestration cuts as it applies to Medicare payments, exempting Medicare from the effects of sequestration from May 1, 2020, through Dec. 31, 2020. The moratorium was extended until April 1, 2022. Cuts of 1% were imposed from April 1 through June 30, 2022. As of July 1, 2022, cuts of 2% were reimposed.</p><p>Hospitals are facing crushing financial challenges. Financial support — while greatly appreciated — provided during the COVID-19 public health emergency just barely kept the field afloat. Rising costs, workforce challenges and diminished Medicare and Medicaid reimbursements are prolonging these challenges. Hospitals and health systems are navigating unprecedented expense increases from supply chain disruptions, workforce shortages, and labor and drug costs. Even before the pandemic, labor costs — including recruitment, retention, benefits, incentives and training — accounted for more than 50% of hospitals’ total expenses. By the end of 2021, hospital labor expenses per patient were 19.1% higher than pre-pandemic levels. There is no way to plan for these increases, particularly in a field that routinely struggles to break even. This financial instability threatens access to care for patients and communities. Without a critical lifeline from Congress, hard choices will need to be made regarding services, staffing and patients’ access.</p><h2>AHA Take</h2><p>Now is not the time for reductions in Medicare payments to providers. Congress should pass legislation to again suspend Medicare sequester cuts, so that hospitals and health systems can continue to care for patients, families and communities.</p></div><div class="col-md-4"><p><a href="/system/files/media/file/2022/09/Fact-Sheet-Medicare-Sequester-Relief-Extension-Needed-for-Health-Providers.pdf" target="_blank" title="Click here to download the Fact Sheet: Medicare Sequester Relief Extension Needed for Health Providers PDF."><img src="/sites/default/files/inline-images/Page-1-Fact-Sheet-Medicare-Sequester-Relief-Extension-Needed-for-Health-Providers.png" data-entity-uuid="d03e53a7-2954-44c0-ac98-54f81a0b138a" data-entity-type="file" alt="Fact Sheet: Medicare Sequester Relief Extension Needed for Health Providers page 1." width="695" height="900"></a></p><div class="external-link spacer"><a class="btn btn-wide btn-primary" href="/system/files/media/file/2022/09/Fact-Sheet-Medicare-Sequester-Relief-Extension-Needed-for-Health-Providers.pdf" target="_blank" title="Click here to download the Fact Sheet: Medicare Sequester Relief Extension Needed for Health Providers PDF.">Download the PDF</a></div></div></div></div> Tue, 13 Sep 2022 12:27:19 -0500 Medicare Sequestration Payment Reductions /fact-sheets/2022-09-13-fact-sheet-statutory-paygo-sequester-relief-needed-health-providers <div class="container"> <div class="row"> <div class="col-md-8"> <h2>The Issue</h2> <p>The COVID-19 pandemic and its aftermath have resulted in historic challenges for hospitals and health systems and the communities they serve in terms of recovery and rebuilding, placing unprecedented stress on the entire health care system and its financing. Like individuals and families across America, hospitals and health systems are dealing with the difficult challenges of high inflation and significant increases in costs from workforce shortages, drugs, equipment and supplies (including food and energy costs) that threaten financial stability and the ability to provide access to high-quality health care services. This is exacerbated by supply chain shortages, managing a backlog in deferred care and navigating government underpayment.</p> <p>The Statutory Pay-As-You-Go Act of 2010 (Statutory PAYGO) requires, among other things, that mandatory spending and revenue legislation not increase the federal budget deficit over a 5- or 10-year period. Should such legislation be enacted without offsets, the Office of Management and Budget (OMB) is required to implement sequestration, or across-the-board reductions, in certain types of mandatory federal spending. Medicare benefit payments and Medicare program integrity spending would be cut, but the reduction cannot be more than 4%.</p> <p>The Congressional Budget Office previously estimated that a Statutory PAYGO sequester in fiscal year 2022 resulting from the American Rescue Plan Act of 2021 passage — the $1.9 trillion COVID-19 relief package passed in March 2021 — would cause a 4% reduction in Medicare spending, or cuts of approximately $36 billion. At the end of 2021, Congress deferred action on waiving Statutory PAYGO, so Congress still needs to waive these cuts to prevent them from taking effect in 2023.</p> <p>Although Congress has passed legislation that has increased the deficit several times since enactment of the Statutory PAYGO law, a PAYGO sequester has never been triggered. In fact, Congress always has acted to waive the reductions, or “wipe the PAYGO scorecard clean,” or postpone those cuts, prohibiting the enacted deficit effects of legislation from causing a PAYGO sequester of Medicare or other federal spending programs.</p> <p>Hospitals are facing crushing financial challenges. Financial support — while greatly appreciated — provided during the COVID-19 public health emergency just barely kept the field afloat. Rising costs, workforce challenges and diminished Medicare and Medicaid reimbursements are prolonging these challenges. Hospitals and health systems are navigating unprecedented expense increases from supply chain disruptions, workforce shortages, and labor and drug costs. Even before the pandemic, labor costs — including recruitment, retention, benefits, incentives and training — accounted for more than 50% of hospitals’ total expenses. By the end of 2021, hospital labor expenses per patient were 19.1% higher than pre-pandemic levels. There is no way to plan for these increases, particularly in a field that routinely struggles to break even. This financial instability threatens access to care for patients and communities. Without a critical lifeline from Congress, hard choices will need to be made regarding services, staffing and patients’ access.</p> <h2>AHA Take</h2> <p>Now is not the time for reductions in Medicare payments to providers. Congress has always acted to prevent or postpone a Statutory PAYGO sequester in years when legislation has been enacted that increases the deficit. Congress must do so again this year — enacting into law provisions to prevent a Statutory PAYGO sequester from taking effect at the end of this session of Congress. Congress must prevent 4% cuts to Medicare from taking effect so hospitals and health systems can continue to care for patients, families and communities.</p> </div> <div class="col-md-4"> <p><a href="/system/files/media/file/2022/09/Fact-Sheet-Statutory-PAYGO-Sequester-Relief-Needed-for-Health-Providers.pdf" target="_blank" title="Click here to download the Fact Sheet: Statutory PAYGO Sequester Relief Needed for Health Providers"><img alt="Fact Sheet: Statutory PAYGO Sequester Relief Needed for Health Providers page 1." data-entity-type="file" data-entity-uuid="2481ad18-7c2b-43cc-9733-64b3a2342ad4" src="/sites/default/files/inline-images/Page-1-Fact-Sheet-Statutory-PAYGO-Sequester-Relief-Needed-for-Health-Providers.png" width="695" height="900"></a></p> <div class="external-link spacer"><a class="btn btn-wide btn-primary" href="/system/files/media/file/2022/09/Fact-Sheet-Statutory-PAYGO-Sequester-Relief-Needed-for-Health-Providers.pdf" target="_blank" title="Click here to download the Fact Sheet: Statutory PAYGO Sequester Relief Needed for Health Providers">Download the PDF</a></div> </div> </div> </div> Tue, 13 Sep 2022 09:41:03 -0500 Medicare Sequestration Payment Reductions /news/headline/2022-05-26-advertorial-hospital-challenges-mount-costs-inflation-rise <p>Hospitals are contending with an exhausted workforce, backlogs of care deferred by the pandemic, cracks in the supply chain and a tsunami of financial challenges, AHA President and CEO Rick Pollack writes in an <a href="/aha-news/2022-05-26-advertorial-hospital-challenges-mount-costs-inflation-rise">advertorial</a> published today in the Wall Street Journal. <br />  <br /> “Taken together, these challenges threaten access to care for patients and communities in the short term and are unsustainable for the long term,” he notes. “To address some of the immediate needs and ensure access to care, we continue to urge Congress to provide support to hospitals and their caregivers.” <br />  <br /> Among specific actions, the advertorial calls for Congress to reverse Medicare cuts that resumed in April and will increase July 1; provide additional funding to address lost revenues and increased expenses brought on by the delta and omicron surges; and extend or make permanent critical waivers that have improved patient care. </p> Thu, 26 May 2022 16:38:17 -0500 Medicare Sequestration Payment Reductions /lettercomment/2022-04-07-aha-urges-congress-provide-additional-covid-19-relief-hospitals <p>April 7, 2022</p> <p>The Honorable Charles E. Schumer               The Honorable Mitch McConnell<br /> Majority Leader                                                Republican Leader<br /> United States Senate                                      United States Senate<br /> Washington, DC 20510                                   Washington, DC 20510</p> <p>The Honorable Nancy Pelosi                           The Honorable Kevin McCarthy<br /> Speaker                                                           Republican Leader<br /> U.S. House of Representatives                       U.S. House of Representatives<br /> Washington, DC 20515                                    Washington, DC 20515</p> <p>Dear Leader Schumer and Leader McConnell, Speaker Pelosi and Leader McCarthy:</p> <p>On behalf of our nearly 5,000 member hospitals, health systems and other health care organizations, our clinical partners — including more than 270,000 affiliated physicians, 2 million nurses and other caregivers — and the 43,000 health care leaders who belong to our professional membership groups, the ���������� Association (AHA) writes to express our disappointment that Congress is adjourning for its April recess without providing Medicare sequester relief or critical financial assistance for hospitals and health systems serving their communities during this unprecedented public health crisis.</p> <p>While we appreciate congressional efforts to provide more funding for COVID-19 vaccines, therapeutics and testing, the needs of caregivers and hospitals also must be addressed to protect access and the stability of our nation’s health care system. Hospitals and health systems are facing a mounting financial crisis brought on by a multitude of COVID-19-related financial challenges, including higher expenses from supply chain disruptions, workforce shortages and increased labor costs; months of essential hospital revenue being erased due to the combination of a forced shutdown and slowdown of regular operations for non-emergent care; and reimbursement rates that do not adequately rise with skyrocketing inflation.</p> <p>Adding to this financial instability, the Provider Relief Fund (PRF), which was established to help health care providers mitigate their COVID-19 losses, has been exhausted. No relief was provided for expenses related to the delta or omicron variant surges, despite 49% of COVID-19 admissions occurring during these two surges resulting in steep increases in cases, hospitalizations and deaths. In addition, $17 billion of the PRF resources were diverted to other uses, leaving many hospitals without the resources needed to face the ongoing and overwhelming COVID-19-related financial and operational challenges.</p> <p>A recent report from the health care consulting firm Kaufman Hall highlighted the harsh reality America’s hospitals and health systems face. This winter, the omicron surge drove COVID-19 hospitalizations to new highs, while also driving down non-COVID-19 volume once again. In February 2022, discharges were down almost 14% from pre-pandemic levels, while length of stay was up about 13%, indicating that the patients who were treated were sicker and more medically complex. This is illustrated by the rapidly increasing expenses that hospitals and health systems have faced. Total expense per adjusted discharge rose nearly 31% in February from pre-pandemic levels; labor expense per adjusted discharge rose 32%; and drug expense per adjusted discharge was up nearly 41%. Those combined factors have kept hospitals’ margins in the negative. Hospital and health system margins were -3.45% in February 2022. Median operating margins were down 42% in February from pre-pandemic levels.<sup>1</sup></p> <p>While we appreciate previous congressional action to provide Medicare sequester relief, health care providers were dealt another financial setback when Congress did not extend that relief past April 1, resulting in a 1% cut in Medicare reimbursement for three months with the full 2% sequester resuming July 1. As a result, the AHA estimates hospitals will lose $3 billion by the end of the year.<sup>2 </sup>Now is not the time to reduce payments to hospitals, especially while a new COVID-19 variant is on the rise and health care providers continue to suffer from immense financial burdens brought on by the pandemic.</p> <p>The AHA urges Congress to act to ensure health care providers have the critical relief outlined in our <a href="/lettercomment/2022-03-23-aha-urges-congress-provide-additional-covid-19-relief" target="_blank">March 23 letter</a>, including but not limited to extending the Medicare sequester relief; adding more PRF dollars; and providing flexibility in the repayment terms for Medicare accelerated and advance repayments.</p> <p>We look forward to working with Congress upon your return from the April recess to provide immediate and vital assistance to our hospitals. If you have any questions, please contact me or Lisa Kidder Hrobsky, AHA senior vice president of federal relations, advocacy, and political affairs, at <a href="http://mailto:lkidder@aha.org" target="_blank">lkidder@aha.org</a> or 202-626-2244.</p> <p>Sincerely,</p> <p>/s/</p> <p>Stacey Hughes<br /> Executive Vice President</p> <p>__________<br /> <br /> <small><sup>1</sup> Kaufman Hall National Flash Report, March 2022, <a href="https://www.kaufmanhall.com/insights/research-report/national-hospital-flash-report-march-2022" target="_blank">https://www.kaufmanhall.com/insights/research-report/national-hospital-flash-report-march-2022</a><br /> <sup>2</sup> Medicare fee-for-service claims, Centers for Medicare & Medicaid Services, Chronic Conditions Data Warehouse, <a href="https://www2.ccwdata.org/web/guest/home" target="_blank">https://www2.ccwdata.org/web/guest/home</a>. Claims from January to November, 2021 were adjusted for completion and annualized to calculate the value of the sequester in 2021, which was then conservatively trended forward to 2022 using the Part A growth rate for 2022 published in CBO’s July 2021 Medicare baseline.</small></p> Thu, 07 Apr 2022 15:37:58 -0500 Medicare Sequestration Payment Reductions /news/news/2022-03-23-aha-urges-congress-provide-additional-covid-19-relief <p>AHA today urged Congress to provide immediate additional support for hospitals and health systems as COVID-19 challenges persist. The letter emphasizes the need for additional Provider Relief Funds to address the “tremendous financial strain” caused by the delta and omicron variants and to extend the deadline for spending previously distributed funds; to extend Medicare sequester relief and adjust the repayment terms for Medicare accelerated and advance repayments; and to continue the Hospital at Home waiver program and other critical flexibilities after the COVID-19 public health emergency. </p> <p>“While the nation remains weary and is eager to move past this pandemic, the virus continues to evolve and pose a threat to our nation’s health care system,” AHA said in a <a href="/lettercomment/2022-03-23-aha-urges-congress-provide-additional-covid-19-relief">letter</a> to congressional leaders. “The recent surge of cases and hospitalizations abroad fueled by the omicron variant known as BA.2 serves as a critical warning: The battle is not over, and hospitals and health systems continue to need resources and flexibilities to care for patients and protect communities.”</p> Wed, 23 Mar 2022 16:12:05 -0500 Medicare Sequestration Payment Reductions /lettercomment/2022-03-23-aha-urges-congress-provide-additional-covid-19-relief <p>March 23, 2022</p> <p>The Honorable Charles E. Schumer          The Honorable Mitch McConnell<br /> Majority Leader                                          Republican Leader<br /> United States Senate                                 United States Senate<br /> Washington, DC 20510                              Washington, DC 20510</p> <p><br /> The Honorable Nancy Pelosi                      The Honorable Kevin McCarthy<br /> Speaker                                                      Republican Leader<br /> U.S. House of Representatives                   U.S. House of   Representatives<br /> Washington, DC 20515                              Washington, DC 20515</p> <p>Dear Leader Schumer and Leader McConnell, Speaker Pelosi and Leader McCarthy:</p> <p>On behalf of our nearly 5,000 member hospitals, health systems and other health care organizations, our clinical partners — including more than 270,000 affiliated physicians, 2 million nurses and other caregivers — and the 43,000 health care leaders who belong to our professional membership groups, the ���������� Association (AHA) urges Congress to provide immediate additional support for hospitals and health systems serving their communities during this unprecedented public health crisis. While the support Congress has provided during the last two years of the COVID-19 pandemic has helped hospitals care for their patients and communities, there is still a significant need for financial support and relief as COVID-19 challenges persist.</p> <p>Since the beginning of 2020, hospitals and health systems — along with doctors, nurses and other team members — have been on the front lines of the COVID-19 pandemic, working tirelessly to provide lifesaving care for patients, families and communities. The AHA thanks Congress for its efforts thus far in helping caregivers and providers through these extraordinarily difficult circumstances.</p> <p>While the nation remains weary and is eager to move past this pandemic, the virus continues to evolve and pose a threat to our nation’s health care system. The recent surge of cases and hospitalizations abroad fueled by the Omicron variant known as BA.2 serves as a critical warning: The battle is not over, and hospitals and health systems continue to need resources and flexibilities to care for patients and protect communities.</p> <p>The AHA strongly supports the Biden Administration’s request for federal support for vaccines and therapeutics, testing, research and funding that supports the uninsured. These are essential to our country’s ability to respond to COVID-19. However, we also urge Congress to include direct support and relief for health care providers.</p> <p>The following are specific details on important programs and priorities needed to assist hospitals and health systems, as well as their courageous team members who continue to serve on the front lines of the pandemic. We look forward to working with you on the continuing needs of hospitals and health systems and the patients and communities they serve.</p> <h2>PROVIDER RELIEF FUND</h2> <p>As you know, at the outset of the pandemic, Congress established the Provider Relief Fund (PRF), which was intended to help health care providers mitigate their financial losses and meet the unique challenges that affected the communities they serve. To date, there have been more than 79 million cases of COVID-19 in the U.S. and more than 970,000 deaths. PRF funds have been exhausted through the disbursement of several tranches and targeted payments with strict guardrails as to how and in what timeframe they could be used. In addition, $17 billion of the PRF resources were diverted to other uses.</p> <p>Shockingly, no distributions were made for expenses related to the Delta or Omicron variant surges, despite 49% of COVID-19 admissions occurring during these two surges resulting in steep increases in cases, hospitalizations and deaths. The lack of PRF dollars to address issues wrought by these surges has left many hospitals facing overwhelming financial and operational challenges.</p> <p>We ask Congress to extend the deadline for spending previously distributed funds and provide additional PRF dollars for health care providers who continue to have lost revenues and increased expenses due to the tremendous financial strain caused by the Delta and Omicron variants.</p> <h2>MEDICARE SEQUESTER RELIEF</h2> <p>The AHA appreciates that Congress, as recently as December, has on a bipartisan basis, halted harmful and imminent Medicare cuts to hospitals and physicians by eliminating a 2% Medicare reduction until April 2022 and then lowering the cut to 1% for an additional three months. The pandemic has put severe financial pressure on hospitals, including, but not limited to: higher expenses for labor, drugs and supplies; the astronomical costs of preparing for a surge of COVID-19 patients; months of essential hospital revenue being erased due to the combination of a forced shutdown and slowdown of regular operations for non-emergent care; and the high cost of treating COVID-19 cases, which tend to be incredibly resource intensive.</p> <p>Without immediate action to delay sequestration by April 1, the AHA estimates hospitals will lose $3 billion<sup>1 </sup>by the end of the year. Now is not the time to be reducing payments to hospitals, especially with a new COVID-19 variant on the rise. We ask that you extend the Medicare sequester relief until the end of the COVID-19 public health emergency or Dec. 31, 2022, whichever is later.</p> <h2>MEDICARE ACCELERATED AND ADVANCE PAYMENTS</h2> <p>In March 2020, both the Centers for Medicare & Medicaid Services (CMS) and Congress made changes to the existing Accelerated and Advance Payments Programs to provide additional benefits and flexibilities due to the COVID-19 pandemic. Subsequently, Congress amended the repayment terms for all providers and suppliers who requested and received accelerated and advance payment(s) during the COVID-19 public health emergency.</p> <p>These payments have served as a critical lifeline to hospitals and health systems, providing crucial funding to support the front-line heroes treating patients, build new sites of care to minimize the spread of the virus, and purchase the ventilators, drugs and supplies to care for the critically ill. However, the requirement to repay these funds places hospitals and health systems back in financial jeopardy while they work through this unprecedented pandemic. We ask that Congress suspend repayments for six months and allow for recoupment after the repayment suspension at 25% of Medicare claims payments for the following 12 months.</p> <h2>COVID-19 WAIVERS</h2> <p>At the outset of the COVID-19 pandemic, a number of regulatory requirements were waived to provide hospitals and health systems with critical flexibilities to manage the public health crisis. Hospitals and health systems used these newly permitted tools to increase capacity, separate areas of care for COVID-19 and non-COVID-19 patients, expand testing and telehealth capabilities, and mitigate workforce challenges. While these flexibilities were created as a direct response to the COVID-19 public health emergency, our members have found that this process acted as a catalyst for establishing new, innovative and safe ways for delivering patient-centered care. We urge Congress to continue some of these flexibilities after the COVID-19 public health emergency.</p> <p>In an attempt to maximize inpatient bed capacity while also limiting potential COVID-19 exposure for practitioners and non-COVID-19 patients, CMS permitted providers to stand up expanded Hospital at Home programs, allowing qualified patients the opportunity to receive care in their homes. Hospitals that established or expanded these programs indicate that they were extremely helpful, allowing for effective care, high patient satisfaction, and, for some patients, shorter recovery times. We urge Congress to extend the program as currently authorized under the waiver to allow providers to continue to take steps to transform care delivery in a way that improves patient experiences and outcomes without sacrificing patient safety.</p> <p>The AHA is pleased that Congress took an important first step by passing legislation that includes provisions to extend and expand telehealth flexibilities for 151 days after the end of the COVID-19 public health emergency. We are grateful for the increased flexibility and continue to urge Congress to make these waivers permanent to protect access to vital telehealth services in every community. We also continue to advocate that critical access hospitals have the flexibility to continue providing telehealth care for patients and communities.</p> <p>We look forward to working with Congress to provide immediate and important assistance to our hospitals. If you have any questions, please contact me or Lisa Kidder Hrobsky, AHA senior vice president of federal relations, advocacy, and political affairs, at <a href="mailto:lkidder@aha.org" target="_blank">lkidder@aha.org</a> or 202-626- 2244.</p> <p>Sincerely,</p> <p>/s/</p> <p>Stacey Hughes<br /> Executive Vice President<br /> __________<br /> <small><sup>1</sup> Medicare fee-for-service claims, Centers for Medicare & Medicaid Services, Chronic Conditions Data Warehouse, <a href="https://www2.ccwdata.org/web/guest/home" target="_blank">https://www2.ccwdata.org/web/guest/home</a>. Claims from January to November, 2021 were adjusted for completion and annualized to calculate the value of the sequester in 2021, which was then conservatively trended forward to 2022 using the Part A growth rate for 2022 published in CBO’s July 2021 Medicare baseline.</small><br />  </p> Wed, 23 Mar 2022 12:44:16 -0500 Medicare Sequestration Payment Reductions /lettercomment/2022-02-08-aha-hospital-groups-ask-congress-additional-help-pandemic-continues <div class="row"> <div class="col-md-6"> <p>The Honorable Charles E. Schumer<br /> Majority Leader<br /> U.S. Senate<br /> Washington, DC 20510</p> <p>The Honorable Mitch McConnell<br /> Republican Leader<br /> U.S. Senate<br /> Washington, DC 20510</p> </div> <div class="col-md-6"> <p>The Honorable Nancy Pelosi<br /> Speaker<br /> U.S. House of Representatives<br /> Washington, DC 20515</p> <p>The Honorable Kevin McCarthy<br /> Republican Leader<br /> U.S. House of Representatives<br /> Washington, DC 20515</p> </div> </div> <p>Dear Leader Schumer, Speaker Pelosi, Leader McConnell and Leader McCarthy:</p> <p>As representatives of our nation’s hospitals and health systems, we are writing to ask you for additional resources for our members as we are continuing to experience financial and operational challenges related to the impacts of treating new variants of the COVID-19 virus. We are very appreciative of the aid that has been given to date and how it has sustained front-line providers and allowed hospitals to continue providing high quality care for their patients and communities during a critical time in the nation’s history.</p> <p>We are entering the third year of the pandemic, and our nation’s hospital and health system workers have cared for over 4 million inpatient admissions of patients with COVID-19. At the same time, patient acuity has risen based on an increase in how long patients are staying in the hospital compared to earlier in the pandemic. The financial pressures hospitals and health systems faced at the beginning of the public health emergency continue, with, for example, ongoing delays in non-emergent procedures, in addition to increased expenses for supplies, medicine, testing and protective equipment.</p> <p>Hospitals also are facing a shortage of workers needed to meet the increased demand for care, and hospital employment has continued to decline compared to pre-pandemic levels. According to data from the Bureau of Labor Statistics, hospital employment is down 95,600 employees from February 2020. This includes a shortage of nurses, who are essential members of the patient care team. To help mitigate these staffing challenges and maintain appropriate levels of care for patients, nearly every hospital in the country has been forced to hire temporary contract staff at some point during the pandemic, including contract nurses. Unfortunately, some travel nurse staffing agencies seem to be exploiting these shortages by inflating prices beyond reasonably competitive levels – two or three or more times pre-pandemic rates – and reportedly retaining high profit margins for themselves. According to Prolucent Health, there has been a 67% increase in the advertised pay rate for travel nurses from January 2020 to January 2022, and hospitals are billed an additional 28%-32% over those pay rates by staffing firms. These increased rates are unsustainable and have contributed to the dramatic increase in hospitals’ labor costs since the beginning of the pandemic.</p> <p>We are grateful that Congress in December extended the moratorium on Medicare sequester cuts, with the reductions fully suspended until April 1, and the cuts reduced from 2% to 1% through June 30. We ask for additional relief from these cuts in 2022.</p> <p>We also ask Congress to act now to ensure hospitals and health systems have the additional resources they need to continue to care for our communities and patients, including supplies and equipment, as well as to offset staffing costs.</p> <p>Thank you for your consideration of these important requests. We look forward to continuing to work with you.</p> <p>Sincerely,</p> <p class="text-align-center">America’s Essential Hospitals<br /> ���������� Association<br /> Association of American Medical Colleges<br /> Catholic Health Association of the United States<br /> Federation of ����������s<br /> National Association for Behavioral Healthcare<br /> Premier healthcare alliance<br /> Vizient, Inc.</p> Tue, 08 Feb 2022 11:23:38 -0600 Medicare Sequestration Payment Reductions /fact-sheets/2021-03-09-fact-sheet-medicare-sequester-relief-needed-health-providers-during-covid-19 <div class="container row"> <div class="row"> <div class="col-md-8"> <h2>The Issue</h2> <p><strong>The COVID-19 pandemic has resulted in historic challenges for hospitals and health systems and the communities they serve, placing unprecedented stress on the entire health care system and its financing. In recent months, the spread of the highly contagious omicron variant has demonstrated that hospitals will continue to experience profound headwinds throughout the rest of 2022.</strong></p> <p>The Budget Control Act of 2011 requires, among other things, mandatory across-the-board reductions in certain types of federal spending, also known as sequestration. Medicare claims with dates-of-service or dates-of-discharge on or after April 1, 2013, incur a 2% reduction in Medicare payment.</p> <p>The Coronavirus Aid, Relief, and Economic Security (CARES) Act, signed into law in March 2020, included critical relief from sequestration cuts as it applies to Medicare payments, exempting Medicare from the effects of sequestration from May 1, 2020, through Dec. 31, 2020. The moratorium has been extended until April 1, 2022, and the cuts have been reduced from 2% to 1% from April 1 through June 30, 2022.</p> <p>As of January 2022, there have been over 70 million COVID-19 cases and nearly 900,000 deaths in the U.S., with over 20 million cases and approximately 100,000 deaths since December 2021. In addition, there have been over 4 million hospitalizations. The number of cases and hospitalization rates have directly affected the U.S. health care system and its ability to continue to provide access to care.</p> <p>The pandemic has put severe financial pressure on hospitals, including, but not limited to: higher expenses for labor, drugs and supplies; the astronomical costs of preparing for a surge of COVID-19 patients; months of essential hospital revenue being erased due to the combination of a forced shutdown and slowdown of regular operations for nonemergent care; and the high cost of treating COVID-19 cases, which tend to be incredibly resource intensive.</p> <h2>AHA Take</h2> <p><strong>During the pandemic, Congress has provided much-needed assistance to health care providers in the form of Medicare sequester relief. This relief helped to improve what was, and continues to be, the relatively dire financial outlook for many hospitals and health systems. However, additional relief is needed. </strong>Congress should pass legislation to extend Medicare sequester relief until the end of the COVID-19 public health emergency or Dec. 31, 2022, whichever is later, so that hospitals and health systems can continue to care for patients, families and communities.</p> </div> <div class="col-md-4"> <div class="panel module-typeC"> <div class="panel-body"> <h5 class="text-align-center"><a href="/system/files/media/file/2021/03/fact-sheet-medicare-sequester-relief.pdf" target="_blank"><strong>Download<br /> Fact Sheet: Medicare Sequester Relief Extension Needed for Health Providers During COVID-19 Public Health Emergency</strong></a></h5> <p class="text-align-center"><a href="/system/files/media/file/2021/03/fact-sheet-medicare-sequester-relief.pdf" target="_blank"><img src="/sites/default/files/2022-01/image-fact-sheet-medicare-sequester-relief-r-342px.png" /></a></p> </div> </div> </div> </div> </div> Mon, 31 Jan 2022 16:11:51 -0600 Medicare Sequestration Payment Reductions