May 12, 2020
U.S. House Speaker Nancy Pelosi unveiled a new $3 trillion coronavirus relief plan on Tuesday that includes $1 trillion in direct aid for states, increases federal matching payments for Medicaid and offers an additional $100 billion in direct aid to physicians and hospitals that does not need to be repaid.
The bill, called “The Heroes Act,” is expected to be up for a vote on the House floor as soon as Friday. Senate Republicans, however, have indicated they have no intention of passing the proposal as drafted, and negotiations over the bill are expected to carry on for weeks. (See CMA's summary of the bill here.)
But the bill offers a marker for Democrats heading into new negotiations, outlining their priorities for a new COVID relief bill. The federal legislation comes just days before California Gov. Gavin Newsom is expected to release a revised state budget that will show a shortfall of more than $54 billion. Newsom’s budget, and the extent of cuts state lawmakers will consider to health care and other social programs, will be shaped in part by the level of federal support.
Speaker Pelosi’s proposal contains many of the California Medical Association’s (CMA’s) top federal advocacy priorities.
The proposal includes more money for Medicaid, including increased payments to facilities that serve a high proportion of Medicaid patients. It also boosts federal Medicaid matching funds to states by 14% through June 2021 to help prevent state Medi-Cal cuts, and increases federal match by 10% for states that keep patients in home-health and community-based care.
In addition to the Medicaid enhancements, the bill includes an additional $100 billion for the $175 billion U.S. Department of Health and Human Services (HHS) Provider Relief fund, with a more equitable distribution formula that would reimburse physicians for 100% of their unreimbursed expenses related to COVID-19 and 60% of each individual physician’s/group’s lost revenue from all payors on a quarterly basis.
For Medicare providers, the bill would reinstate the Medicare Advance Payment Program, with a lower 1% interest rate and a 12-month extended timeline for repayment, retroactive to March 1.
Speaker Pelosi’s bill also delays implementation of the proposed Medicaid Fiscal Accountability Rule that would cut Medicaid funding by up to 50% in all 50 states.
The bill would also provide an additional $75 billion for coronavirus testing, contact tracing and isolation measures, and health insurance coverage to ensure every American can access free coronavirus treatment.