Update – US Federal Payments to Hospitals For Treating Uninsured COVID-19 Patients
On Friday, April 3, 2020, the administration announced that the US federal government would compensate hospitals and other providers treating uninsured COVID-19 patients at Medicare rates. Health and Human Services Secretary Azar said:
“Under the President’s direction, we will use a portion of that funding [CARES Act] to cover providers’ costs of delivering COVID-19 care for the uninsured, sending the money to providers through the same mechanism used for testing.”
When making this announcement, the Secretary stressed that providers would be paid at Medicare rates and would be forbidden to balance bill any covered person. Although asked, Azar did not clarify whether government funds would be available for treating undocumented persons. Azar promised that regulations explaining how this would work would be released soon.
While HHS has not issued new regulations, Secretary Azar stated in an interview yesterday that providers treating uninsured COVID-19 patients “[c]an register to get Medicare reimbursement for uninsured treatments starting on April 27 via a website that will soon be launched https://www.hrsa.gov/coviduninsuredclaim.” Resolving concerns about coverage for undocumented persons, Azar also specifically stated that providers will not be required to inquire as to an uninsured patient’s immigration status.
The funds to cover these expenses will come from the $100 billion allocated to hospitals in the CARES Act. While the Secretary was not precise about how much money would be available to cover these costs, he stated that HHS expected there to be sufficient funds based on its understanding of the rates of “uninsured utilization and COVID utilization.”
Others are skeptical. For example, the Kaiser Family Foundation released a study on April 7, 2020 that estimates that the cost of treating uninsured COVID-19 patients ranges from nearly $14 billion to $41 billion. In reaching this conclusion, Kaiser used the 2017 Medicare cost to provide hospital-based care for respiratory infections (less severe illness) and more serious conditions including pneumonia. The Kaiser study then added 20% to these typical charges due to COVID-19 complexity, borrowing the formula adopted by Congress in the CARES Act. Kaiser conservatively estimated that 2% to 7% of uninsured people could require hospitalization for the virus, leading to between 670,000 and a little more than 2 million hospitalizations.
Hospitals and public policy experts continue to press the administration to open a special enrollment window under the ACA to permit uninsured patients who do not qualify for Medicaid to seek coverage under the ACA. Resisting this request, Secretary Azar states repeatedly that there will be sufficient government funding to cover the cost of treating the uninsured COVID-19 patients. Time will tell.
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