Safety net hospitals concerned with method CMS will use to allocate $30B in grants to providers

Seema Verma interviewed by Steve Forbes at Forbes Healthcare Summit
CMS Administrator Seema Verma announced on Tuesday that the agency will give $30 billion to providers based on Medicare spending. (Forbes/GettyImages)

A safety net hospital association is worried about how the Trump administration will give out $30 billion in grants to hospitals this week to help them stay afloat during the COVID-19 outbreak.

Centers for Medicare & Medicaid Services Administrator Seema Verma announced on Tuesday that the agency will give $30 billion in grants to providers this week, which is part of the $100 billion hospital fund pass with the economic stimulus package.

Verma said that the $30 billion will be dispersed to hospitals based on Medicare revenue and will come with “no strings attached.”

She said that providers can get the money via direct deposit.

“This is not a first-come, first-serve basis,” Verma added.

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But America’s Essential Hospitals, which represents hospitals that take on a high amount of charity care, was concerned about the reliance on historical fee-for-service Medicare funding.

“An allocation methodology that consists only of Medicare fee-for-service revenue could tilt the playing field against some essential hospitals, which care for disproportionate numbers of uninsured and Medicaid patients,” said Bruce Siegel, M.D., president and CEO of the group, in a statement on Tuesday.

Verma did touch on the issue during her remarks at the White House’s coronavirus task force briefing. She said that there are some providers such as pediatricians or nursing homes that have a lot of revenue from other sources.

“Those will be addressed in the second tranche of funding,” she said.

CMS also recently doled out $34 billion in accelerated and advance payments to providers.

The spate of payments comes as more and more hospital systems decide to furlough workers as revenues have evaporated due to low patient volume and cancellation of elective procedures.