Hospital entrance sign

Hospitals to receive advanced Medicare payments

Hospitals around the country are preparing to handle the onslaught of patients who need care due to the spreading coronavirus. Some hospitals, like those in New York, are already facing a massive wave of patients needing high-intensity care. One of the ways that hospitals have prepared themselves is to cancel surgeries that can be postponed, such as elective surgeries that generally have high margins for hospitals.

While it may be necessary to delay these procedures to preserve bed space for patients who need immediate care, the hospitals are likely to take a huge financial hit from the loss of consistent revenue from these procedures. This is a point that many hospitals have raised as they are not only canceling most non-urgent surgeries, they are also shifting resources to those who need coronavirus treatment.

With the decreased cash flow in mind, the Centers for Medicare and Medicaid Services (CMS) was authorized by the CARES Act to set up accelerated and advanced Medicare payments for hospitals that need cash. Modern Healthcare recently reported:

The Coronavirus Aid, Relief, and Economic Security Act—CARES—which President Donald Trump signed into law on Friday, enables all Medicare providers to tap into an emergency fund in order to shore up their cash flows.

“With our nation’s healthcare providers on the front lines in the fight against COVID-19, dollars and cents shouldn’t be adding to their worries,” CMS Administrator Seema Verma said. “Unfortunately, the major disruptions to the healthcare system caused by COVID-19 are a significant financial burden on providers. Today’s action will ensure that they have the resources they need to maintain their all-important focus on patient care during the pandemic.”

Typically, the CMS only makes such a move to assist providers impacted by a natural disaster. But Saturday’s change applies to all hospitals, doctors, durable medical equipment suppliers and other Medicare Part A and Part B providers and suppliers.

The uncertainty of this time will greatly impact the normal operations of the health care system. CMS’s move here will assist the frontline health care workers by eliminating non-coronavirus concerns.

Jordan Roberts / Health Policy Analyst

Jordan joined the Locke Foundation in the summer of 2018 as Health Care Policy Analyst. He analyzes state and national health policy issues with an eye toward removing governm...

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