The voluminous American Rescue Plan – the second largest stimulus package in U.S. history – has something for everyone. Almost.
The $1.9 trillion package that passed the Senate over the weekend and is expected to be passed by the House March 9 failed to extend the current moratorium, set to expire April 1, on the 2% Medicare sequestration. That means Medicare reimbursement for Part B drugs and other covered services will be subject to the automatic cut once again next month.
Adding to the hurt, the Congressional Budget Office has predicted that cut could go up to 4% next year under the pay-go statute. That would be about a $36 billion slice for doctors and hospitals. It also could be a factor as to which Part B drugs and services are used to diagnose and treat patients covered by Medicare.
Conceived as a national debt control effort, the 2% Medicare sequestration has been in force since 2012. But the CARES Act, the first COVID-19 stimulus package that was passed last May, put the sequester on hold until Jan. 1. In response to requests from several health care organizations, Congress extended the hold in December for three more months.
The day before the Senate passed the American Rescue Plan, the American Medical Association (AMA) wrote to congressional leaders urging them to amend the legislation to extend the moratorium once again. “We strongly oppose these arbitrary across-the-board Medicare cuts and the predictably devasting impact they would have on many already distressed physician practices,” AMA CEO and Executive Vice President James Madara said in the letter.
The AMA wasn’t the only group to stress the need for continuing the moratorium. After the Senate voted 50-49 to pass the bill Saturday, the American Hospital Association (AHA) said it was concerned that the American Rescue Plan didn’t address the sequester.
The groups do have another shot at renewing the moratorium, but it could be a long one. Reps. Brad Schneider (D-Ill.) and David McKinley (R-W.Va.) re-introduced a bill in January that would lift the Medicare sequester for the duration of the public health emergency. However, there’s been no action on H.R. 315, the Medicare Sequester COVID Moratorium Act, since it was referred to the House Budget Committee. Congressional watchers give it a 25% chance of being enacted.
The failure to extend the moratorium wasn’t the only disappointment in the American Rescue Plan. The AHA also expressed concern about the level of overall funding for the Provider Relief Fund, which it said “has been crucial in supplying hospitals, health systems and other providers with resources during the pandemic.”
On the positive side, the bill includes:
- $47.8 billion for COVID-19 testing and contact tracing;
- $7.5 billion for vaccine administration and distribution;
- $10 billion for emergency medical supply production under the Defense Production Act;
- $6.05 billion for the development, manufacturing and government procurement of vaccines and therapies for COVID-19 or other diseases with pandemic potential;
- $1.75 billion for SARS-CoV-2 genomic sequencing and surveillance;
- $1 billion for government activities to increase vaccine confidence and improve the rate of COVID-19 vaccinations;
- $500 million for FDA activities related to evaluating and monitoring COVID-19 devices, drugs and vaccines;
- $500 million to support public health data surveillance and analytics infrastructure modernization initiatives at the CDC, and to establish and maintain efforts to modernize the U.S. disease warning system to forecast and track hotspots for COVID-19, its variants and emerging biological threats;
- a provision mandating coverage of COVID-19 vaccines, administration and treatment under Medicaid and the Children’s Health Insurance Program.