PAYGO isn’t a crypto-currency or easy way to send money through your smart device. It is shorthand for the congressional “pay as you go” policy. The policy requires — unless waived by lawmakers — that any new spending be offset by cuts to existing spending for deficit control. The system has been in place since 2010 and has generally not been used as a partisan cudgel when lawmakers move spending through the reconciliation process.
The recent $1.9 trillion COVID-19 relief package was adopted without a PAYGO waiver. House Democrats have introduced legislation to waive the PAYGO policy for the American Rescue Plan Act, and to extend the existing freeze on the longstanding Medicare sequester through the end of the pandemic. Both issues are extremely consequential to hospitals and health care providers. Without PAYGO waived, the law would require massive cuts to health care spending. At the same time, without additional legislation, the 2% Medicare sequester — in place since late in the Obama administration — could return before the end of the pandemic.
Unfortunately, despite the broad and bipartisan public support for the relief legislation, the PAYGO waiver could develop into an extremely consequential and highly political game of chicken between the parties.
What Congress does will be consequential. According to Paul Keckley, the relief package without PAYGO, could require “reductions in Medicare spending of 4% next year, totaling $36 billion. That means lower reimbursement by Medicare to hospitals, physicians and other providers on the heels of pandemic-derived operating losses projected to be $373 billion to $442 billion for 2020-2021.”
Although the maximum statutory cut to most of the Medicare program is 4%, it’s clear that in a post-pandemic world, this scale of cuts would be devastating to health care providers. However, health care programs are not the only programs at risk if PAYGO is not waived. Experts suggest that the size of the relief package could, under PAYGO, require harmful cuts to other federal programs like student aid, state unemployment operations and some farm programs.
Chicken is not a game designed to result in calamity. It is fundamentally about determining your pain points and acceptance of risk, and that of your opponent. In a successful game of chicken, one or both parties turn away from the danger.
In Washington, agreement on the danger can sometimes be hard to find. For example, despite public support, members of Congress are debating whether the law was designed to bridge the nation into recovery or determine the nature of the safety net post-recovery. There are questions about why PAYGO and an extension of the waiver of the 2% sequestration weren’t included in the relief package but are being pursued independently.
The question then arises — was this omission designed to create a “major” political issue, where one party can create a wedge issue against the other? As one Democratic leader in the House of Representatives claimed, “If Republicans play political games and don’t do their jobs, Medicare and the seniors that depend on it will pay the price.” Or, can this issue be used as a tool for the minority party — in this case, the GOP — to extract policy concessions?
Whether oversight or strategy, the answers are less important than the implications. This cliff must be averted. A PAYGO waiver is necessary for the integrity of the Medicare program — to avoid calamitous reductions in provider payment and to sustain the program for Medicare beneficiaries.
When the pandemic is over, there will be ample time to engage in a spirited debate about the effectiveness of the numerous relief bills and the future of spending policy. To effect PAYGO and unleash massive cuts to Medicare — just as hospitals and health care providers are beginning to return to normal — would invite catastrophe.
The game of chicken only works if neither player is intent on actual harm.
U.S. House Advances Sequestration Waiver And PAYGO Legislation
Biden Administration Withdraws Arkansas Medicaid Work Requirement Approval
Xavier Becerra Confirmed As HHS Secretary
HHS Delays Trump Rule On Regulatory Review
MHA Reports Program Years 2019-2021 Medicare Pay-for-Performance Overview
MLN Connects Provider eNews Available
Updated COVID-19 Vaccine Dashboard Available
HIDI Opens 2020 Annual Licensing Survey Of Missouri Hospitals
Patient Safety Awareness Week Highlight: Creating A High Reliability Organization
FMT Publishes Policy Brief Evaluating The Use Of CAH Cohorts For Quality Improvement Activities
CMS Alerts Users Action May Be Needed To Receive Reports Through Managed File Transfer
Dwayne Proctor To Succeed Bob Hughes As Missouri Foundation For Health CEO
NIMH Seeks Input On Rural Mental Health Disparities
Poplar Bluff Regional Medical Center Names Interim CEO
Truman Medical Centers Prepares For Mega Vaccination Event
By a vote of 246-175, the U.S. House of Representatives approved legislation to extend the waiver of the 2% Medicare sequestration. The waiver first was authorized in March 2020 in response to the COVID-19 pandemic and expires at the end of this month. H.R. 1868 also clarifies a December 2020 law regarding Medicare payments to provider-based rural health clinics. These changes are packaged with a PAYGO exemption for the $1.9 trillion American Rescue Plan Act and this legislation. House debate could take place this week. MHA urged the Missouri congressional delegation’s support of the legislation. The proposal will need 60 votes to advance in the U.S. Senate.
The Biden administration officially withdrew Centers for Medicare & Medicaid Services’ approval of Arkansas’ Medicaid work requirement waiver on the ground that the waiver is inconsistent with the core tenets of the Medicaid program. The action follows an earlier communication from the administration of its intent to review the Trump administration’s Medicaid health policy positions. This marks the first time in the history of Medicaid that the federal government rescinded its approval of a Section 1115 waiver. CMS is expected to withdraw its approval for 11 other states that have approved Medicaid work requirement waivers, and to reject the pending applications of seven states.
By a vote of 50-49, the U.S. Senate confirmed Xavier Becerra as the Secretary of U.S. Department of Health and Human Services. He is a former California state attorney general and member of Congress.
The U.S. Department of Health and Human Services delayed implementation of a final rule calling for departmental regulations to expire if they are not periodically reassessed. The final rule was implemented in the closing days of the Trump administration and became effective the day before President Biden took office. With the one-year delay, the rule will take effect on March 22, 2022. Litigation is pending in federal court to challenge the final rule.
As the Centers for Medicare & Medicaid Services continues to tie payments to quality, the mandatory pay-for-performance programs continue to evolve. MHA released an analysis detailing the Hospital Readmissions Reduction, Hospital-Acquired Conditions and Value-Based Purchasing programs. The analysis includes details about the weighting, hospital performance and financial impact for program years 2019, 2020 and 2021.
Policy and analytic studies are available for download to authorized users of HIDI Analytic Advantage. If you need a user ID and password or have questions about accessing these reports, please contact HIDI.
The Centers for Medicare & Medicaid Services issued updates to MLN Connects Provider eNews. eNews includes information about national provider calls, meetings, events, announcements and other MLN educational product updates. The latest issue provides updates and summaries of the following.
clinical laboratory data reporting delayed until 2022: reminder
The interactive Vaccine Administration dashboard now is available with doses administered through March 18. This dashboard is accessible to authorized users of HIDI Analytic Advantage. If you need a user ID and password or have questions about accessing these dashboards, please contact HIDI.
The 2020 Annual Licensing Survey of Missouri Hospitals was posted to HIDI Analytic Advantage today. The survey is a combined data collection effort of MHA, the American Hospital Association and the Missouri Department of Health and Senior Services. Data from the annual survey is used to support various MHA advocacy efforts and is a key source of information regarding the hospital industry in Missouri. Upon request, various reports, including trends analysis, margins analysis and other reports, are available to participating hospitals. Completed surveys are due to HIDI by Friday, April 30.
Hospital leaders are responsible for establishing safety as the most important part of care delivery. Sustainment of highly reliable health care is critical to achieving zero preventable health care-acquired conditions, and continuous process improvement in health care is necessary to evolve and grow.
MHA supports hospitals in becoming Highly Reliable Organizations, which create and support an environment of collective mindfulness in which all workers look for and report small problems or unsafe conditions when they are easy to fix and before they pose a substantial risk. A commitment to support and sustain a system of high reliability principles and safety should be an organization’s overarching strategy, and to support this goal, MHA offers a High Reliability Organization Toolkit. The toolkit includes five key principles: transparency, communication, accountability, continuous learning and improvement models. Practical application strategies and resources are available to guide organizations on their HRO journey.
The Flex Monitoring Team published a policy brief that describes how State Flex Programs use cohorts of critical access hospitals in quality improvement initiatives. It discusses the benefits and challenges of CAH cohorts, how SFPs are evaluating the impact of these initiatives, and opportunities to enhance the use of cohorts in Flex Program activities. This report lays out a conceptual framework to assess the cohort projects and the extent to which they are likely to contribute to improved QI performance by the participants. Successful cohort initiatives actively engage CAHs in implementing a shared QI project, provide opportunities for shared learning and establish a clear data reporting process. The findings from this study of QI cohorts also can inform efforts to use cohorts in other Flex Program areas.
The Centers for Medicare & Medicaid Services notified users that action may be needed to receive certain reports in Managed File Transfer. Users who historically received reports through the AutoRoute Inbox in Secure File Transfer may need to request permissions in the Hospital Quality Reporting system. Additional information is available.
The Missouri Foundation for Health selected Dwayne Proctor, Ph.D., to succeed Bob Hughes as the foundation’s CEO. Mr. Hughes announced his plans to retire this spring after nearly 10 years as the foundation’s leader. Dr. Proctor comes to MFH from the Robert Wood Johnson Foundation in New Jersey, where he held the position of senior adviser to the president. Dr. Proctor begins his tenure at MFH on Monday, May 3.
The National Institute of Mental Health issued a request for information to seek input on how they can learn about, remedy and research gaps to address mental health disparities in rural people and communities. Responses should be submitted by Thursday, April 15.
Christian Jones has been named the interim CEO at Poplar Bluff Regional Medical Center, effective March 10. Jones will serve as the interim CEO and COO until a permanent replacement is selected. He replaces Bryan Bateman who served as the CEO since 2017.
During the next two days, a mega vaccination event is being held at Arrowhead Stadium in Kansas City, Mo. Yesterday, Truman Medical Center’s Dr. Mark Steele, M.D., and Colonel Russell Kohl with the Missouri National Guard met with media to discuss logistics. Gov. Parson, who is attending today’s event, said that approximately 6,000 Missourians will be vaccinated during the two-day event.
