Late Thursday, January 18, the US House of Representatives passed the Senate-approved measure for a continuing resolution to keep the government funded through early March. The stopgap measure goes to President Biden today, who is expected to sign it.
The resolution staves off a partial government shutdown and extends last year’s spending levels, including extensions for several significant healthcare programs:
- Community health centers
- Teaching Health Center Graduate Medical Education Program
- Special Diabetes Program
- National Health Service Corps
Additionally, Medicaid Disproportionate Share Hospital (DSH) payment cuts have been delayed through March 9, as has the physician work portion of the geographic cost index (GPCI) floor expiration through Medicare. The DSH payment cuts would have a significant impact on facilities treating large numbers of low-income patients.
What This Means for Rural Providers
The American Hospital Association and other advocacy groups have urged Congress to reject these cuts, stating that they will directly impact the care and services available to vulnerable patients in rural communities. If the physician work portion of the GPCI floor were removed, physicians providing services in 51 predominantly rural localities would see an additional reduction (up to a 5% change) on top of the Medicare Physician Fee Schedule (MPFS) cuts in reimbursement. Given the financial vulnerability of many rural hospitals, which function as both a safety net for secondary care and as a primary employer in their local communities, removing the GPCI floor could have devastating consequences to patient access to care across the country.
While there has been continued debate on addressing the MPFS payment cuts and changes to the budget neutrality requirement, no legislation has been passed to counteract the reduction to the conversion factor that took effect on January 1, 2024. The congressional record from January 17, 2024, states that “CMS has said that they are going to hold payments until Congress acts.”
What’s Next?
ECG closely monitors policy updates and regulatory changes at the national level that may impact healthcare organizations and providers. While this short-term funding measure provides a temporary reprieve, similar dialogue will likely occur in March, when the formal appropriations process is finalized. Provider organizations should proactively analyze the potential impact of these legislative changes on their practice.
Contact us for a better understanding of the implications of recent legislation as well as MPFS changes on your provider compensation plans, reimbursement, and contracts.
Contact Us
Edited by: Matt Maslin
