Money, Healthcare

Healthcare providers, including nursing homes, are demanding continued relief from the 2% Medicare sequester cuts through the duration of the COVID-19 pandemic. The relief would help improve the “relatively dire financial outlook” providers are facing thanks to the public health emergency, four top provider groups warned. 

Federal lawmakers in May approved a moratorium on the sequester cuts through the end of 2020 with the passage of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. No action has been taken on the issue since.

“Clearly, Congress recognized the importance of this relief for the duration of the [public health emergency],” the American Health Care, American Hospital and American Medical associations, and the National Association for Home Care & Hospice, wrote in a letter Thursday to Congressional leaders.

“This relief helped to improve what was, and continues to be, the relatively dire financial outlook for many of our members,” they wrote. “Clearly the cost of providing care to patients continues to increase. Without future sequestration relief, America’s health care safety net could be at further risk of collapse.” 

The 2% sequestration reduction to Medicare payments have been in place since 2013. A 2013 analysis found that it would reduce payments to skilled nursing facilities by $9 billion over 10 years when the sequestration cuts first took effect.

The groups argued that it’s safe to assume the public health crisis will continue into 2021 and that providers will see continued financial challenges and pressures associated with higher overhead costs and lost revenue. 

“In some cases, this 2% cut will effectively negate the Medicare inflation adjustment health care providers depend on and would otherwise receive in 2021,” the groups concluded. “As such, we respectfully ask that Congress pass legislation this year that further postpones the application of this harmful 2% cut for the duration of the PHE in 2021.” 

In other news, Congress late Sunday evening reached an agreement on a $900 billion stimulus package. LeadingAge President and CEO Katie Smith Sloan called the deal a “helpful down payment, but it falls short in providing the necessary relief for older Americans.” 

“This crisis is far from over, and the launch of the vaccine cannot become an excuse to walk away from older Americans. The continuing surge of infection, illness and deaths — and the unsustainable escalation of costs — means that struggling aging care providers need more testing, PPE, staffing support and money than this package provides,” Sloan said. 

“Some providers are shutting down, and more will follow unless the next Congress steps up and provides more robust support,” she added.