Suppliers brace for financial shocks as COVID-19 uninsured fund ends

Human welfare hospitals, medical centers and federally qualified laboratories may have to cut staff and hours of operation and limit patient access if Congress and President Joe Biden fail to reach an agreement to further ease the COVID-19 pandemic.

The COVID-19 uninsured program was an early casualty of a budget impasse between lawmakers and the White House, which originally requested $22.5 billion for the ongoing COVID-19 response. Laws passed by Biden and President Donald Trump authorized the program, which began in 2020, to guarantee payment to healthcare providers for COVID-19 care for an estimated 28 million uninsured US residents.

The federal government has paid healthcare providers more than $17 billion to test, treat and vaccinate the uninsured. On March 22, the Health Resources and Services Administration ran out of money for the program and stopped reimbursing service providers for COVID-19 testing and treatment. Starting Tuesday, HRSA will no longer pay service providers to vaccinate uninsured people.

“If we have to chase down payments that may not materialize, then it becomes more of a question, ‘Will I continue to offer this service as a lab?’” said Tom Sparkman, senior vice president of the company. public affairs and politics at the American Association of Clinical Laboratories.

Members of the trade association conducted 8 million tests on uninsured patients last year, Sparkman said. During the omicron wave in January and February, these labs performed 1 million tests on patients who had no coverage.

Without reimbursement, Curative will no longer be able to offer free testing in some of the 18 states in which it operates, a spokesperson wrote in an email. The company debuted in early 2020 with a focus on sepsis patients, but switched to COVID-19 testing with the onset of the pandemic. Curative did not respond to interview requests about the financial implications of the policy or that it would no longer provide free testing to uninsured people.

The company announced that Quest Diagnostics will begin charging uninsured individuals $100 per test. In 2021, COVID-19 testing accounted for a fifth, or $2.8 billion, of the company’s $10.8 billion in revenue.

Hospitals have the financial resources to endure the end of an uninsured fund, but unpaid bills will still be a burden, said Rick Kees, RSM’s healthcare partner. Unlike retail clinics and labs, which can turn away patients, hospital emergency departments are required to care for people regardless of their ability to pay, according to long-standing federal law, he said.

“When someone comes in who has COVID and spent six days in the intensive care unit, it will be much more expensive than doing a test in a retail clinic,” Kes said. The impact on margins is likely to be negligible, he said, but healthcare systems will face more bad debts and be forced to write off more charitable services.

Since social care hospitals serve the largest number of uninsured patients, they will be hit the hardest, according to Beth Feldpush, senior vice president of policy and advocacy at America’s Essential Hospitals. These institutions already bear a disproportionate amount of grants compared to their size and operating profits. In 2019, social care hospitals provided $6.9 billion worth of pro bono services, representing 16.5% of all medical care in the country, according to data organization’s latest information.

“They are not going to choose certain services, but it will be a financial hit,” Feldpush said. “Perhaps they need to consider where they can save money. You may have to cut back on weekend hours, or you may not be working until late at night for shift workers to come in.”

Hospitals are still trying to figure out what the end of the program will mean for them amid other financial pressures, such as higher wages and supply costs, Feldpush said.

Social safety net hospitals are also aware of two impending federal policy changes that could lead to a dramatic increase in the number of uninsured and their unreimbursed treatment costs. Whenever Biden decides not to renew the declaration of a public health emergency, the states will restart the process of redefining Medicaid, which will reduce listings. And expanded subsidies that led to record exchange-traded health insurance coverage are due to expire at the end of the year.

“It will be a burden,” Feldpush said. “This will be layered on top of other existing problems that the pandemic has had on hospital finances.”

Security net hospitals, at the federal level skilled health centers as well as community clinics, which the care for but predominantly low income Population, endured financial difficulties early in in pandemic before in federal government began sentence support across programs such because in uninsured fund, said Isabelle Becerra, CEO of the Orange County Community Health Centers Coalition in California.

The uninsured fund has mitigated that problem, Becerra said, so its expiration would exacerbate existing financial pressures on public clinics, with at least 40% of their patients uninsured. “No one will be denied,” she said. “But it may take some time before you enter.

Public health centers will have to cut hours and staff if the uninsured fund is not restored, Becerra said. Patients who have been turned down by others will turn to social care providers, she said, leading to long waits for testing and vaccinations. This, in turn, will deter people from vulnerable populations from seeking tests and vaccines. In addition to health risks, it will also weaken public health data collection because there will be fewer test results to analyze, she said.

“It’s not just the huge financial implications for medical centers across the country,” Becerra said. “It’s like we haven’t learned anything in the last two years and it’s like we believe there won’t be any further options and it’s like we now believe we are all 100% vaccinated.”

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