Kaiser Health News reports that the US Department of Health and Human Services (HHS) is misdirecting the first $30 billion of stimulus funds intended for health care providers treating COVID-19 patients. It is apportioning the stimulus money based on hospitals’ revenues from traditional Medicare and away from hospitals that desperately need it. Hospitals burdened with high COVID-19 expenses which do not treat a sizable portion of people with traditional Medicare are losing out. Will the hospitals most at risk stay afloat?
The CARES Act, which appropriated $100 billion for hospitals and doctors, gives HHS discretion as to how to allocate these money. Why HHS chose to distribute the money based on past Medicare payments is an open question but appears to be because it was easy to do. The law specifically states that the money is intended “to prevent, prepare for and respond to coronavirus.”
Hospitals that treat a disproportionate share of uninsured patients and patients with Medicaid are not seeing the money they need. For example, Florida’s Jackson Health hospital system, one of the nation’s largest public health systems, is suffering from lack of federal funds and a huge COVID-19 caseload. It is losing $25 million a month in revenue from canceling elective procedures. It is not alone.
Other hospitals in “hot spot” areas are also not seeing the emergency money they need. In stark contrast, hospitals in states that are not facing heavy COVID-19 caseloads are receiving more than $300,000 for each report COVID-19 case. And, many of these hospitals are generating good income because they can continue to perform elective procedures. New York is receiving just $12,000 for each COVID-19 case. New York has the highest number of recorded COVID-19 cases. New Jersey has the second-highest number.
It appears that our nation’s multi-payer system makes it easier to channel money to traditional Medicare providers than to hospitals that don’t see as many fee-for-service Medicare patients. That said, HHS claims it will focus its next wave of payments on rural hospitals and hospitals that don’t see as many Medicare patients.
Here’s more from Just Care:
