A look at some of the healthcare-specific provisions in the pending COVID-19 relief legislation

With a $1.9 trillion COVID-19 relief package making its way through Congress, several provisions have implications for the healthcare industry.

President Joe Biden proposed the American Rescue Plan to bolster the COVID-19 vaccination program, boost the national economic recovery and safely reopen schools, among other goals. In drafting the legislation, Congress issued specific proposals that could have a direct impact on healthcare coverage and hospital finances.

A boost for rural healthcare providers

Sens. Susan Collins (R-Maine) and Joe Manchin (D-WVa.) proposed a budget amendment to add $35 billion to the Provider Relief Fund (PRF), and the amendment passed the Senate last week. If incorporated in the final legislation, the amendment would set aside 20% of the $35 billion for rural healthcare providers.

Manchin noted in a news release that Congress has appropriated $178 billion to the PRF since passage of the CARES Act in March, yet only 6% has been directed to rural providers.

“Nearly 20% of Americans live in rural communities, making a 20% set-aside only fair,” he said.

An attempt to buttress the Affordable Care Act marketplaces

At the House committee level, proposals under consideration would expand support for healthcare coverage under the Affordable Care Act (ACA).

The Ways and Means Committee planned votes for the week of Feb. 8-12 on provisions that aim to make health insurance more affordable by:

• Reducing premiums for low- and middle-income families by increasing the ACA’s premium tax credits for 2021 and 2022
• Supporting the continuation of employer-based health coverage by subsidizing COBRA coverage through the end of the fiscal year
• Creating healthcare subsidies for unemployed workers who are ineligible for COBRA

Support for the Medicaid program

Proposals being considered by the House Energy and Commerce Committee are designed to boost Medicaid coverage.

The “Medicaid rebate cap” for drug pricing would be rescinded starting in 2023, making it less advantageous for drug manufacturers to raise prices. With the current cap of 100% of a drug’s average manufacturer price, pharmaceutical companies can raise prices and avoid potentially big increases in the rebates they owe state Medicaid programs.

For the 12 states that have yet to expand Medicaid as authorized by the ACA, the federal government would pick up 95% of the cost of the expansion over the next two years. That’s an increase from the current share of 90%.

In addition, Medicaid coverage could be extended to women for 12 months postpartum over the next five years.

Under another proposal, federal funds would be used to give state Medicaid programs incentives to cover mobile crisis intervention services for individuals experiencing a mental health or substance use disorder crisis.