The power of the purse and the power to prosecute are two of the tools governments have at their disposal to effect change in both individuals and institutions.  There’s nothing like a good old-fashioned threat by federal authorities to cause citizens to sit up and take notice.  But when such threats are issued to America’s front-line responders in the midst of a national pandemic, more than a little consternation is bound to result.  That’s the situation hospital executives find themselves facing this week as they are about to become potential targets of punitive government action.

Raising the Alarm

National Public Radio (NPR) is reporting that it has come into possession of “internal documents” drafted by individuals at the Centers for Medicare and Medicaid Services (CMS), which indicate that the agency “is preparing to crack down aggressively on hospitals.”  The impending action will specifically be against those facilities who failed to report “complete COVID-19 data daily into a federal data system,” as mandated earlier this summer by the Trump administration.

You will recall that the U.S. Department of Health and Human Services (HHS), back in July, set new parameters for reporting COVID information to the government.  Instead of hospitals providing their virus-related statistics to the Centers for Disease Control and Prevention (CDC), they were now directed to report their COVID data (e.g., number of COVID patients, availability of intensive care beds, etc.) directly to HHS via a newly created reporting system.

The move caused concern in some circles that COVID information was being taken out of the hands of the epidemiology experts and redirected to partisan operatives with political agendas.  What many failed to realize is that the CDC, like CMS, is an agency within HHS, and there was never any plan to limit the CDC from accessing the data.  On July 16, ABC News reported the following:

CDC Director Dr. Robert Redfield forcefully defended the change in a call with reporters, insisting that the federal government’s effort to create a single database run by HHS—linking an estimated 4 billion disparate data elements on everything from testing to the race and ethnicity of patients to hospital supplies and bed space—instead of through the CDC—can only help the CDC’s efforts.

Lowering the Hammer

In late August, CMS issued a rule indicating that failure to comply with the new reporting methodology could cause hospitals to forego their federal Medicare funding.  The rule went into effect August 25 without any chance for comment or revision. The agency reasoned that the public health emergency was sufficient enough cause to dispense with the normal bureaucratic processes.

The government now appears ready to make good on its late-August threat.   The draft letter from CMS requires hospitals to report data “for all seven days, including weekends” into the HHS data collection system.  According to the NPR report, failure to comply after multiple warnings “will result in a termination of the Medicare provider agreement.”

The new guidance, which may be sent out to hospitals this week, will also add new reporting requirements, according to NPR.  For example, hospitals will have to provide daily numbers relating to influenza cases, not just COVID-19.  Hospitals that fail to follow the new regulations could be ousted from the Medicare and Medicaid programs. CMS estimates that 6,200 hospitals currently participate in those two federal health programs.

Many have expressed their concern over this planned move, describing it as overreaching and a “nuclear option.”  However, a CMS spokesman said the move was necessary as the voluntary reporting system provided data from only 85 percent of the nation’s hospitals.  Ironically, only “24 percent of America’s hospitals met the HHS reporting requirements for the week of Sept. 14,” according to an internal CDC report obtained by NPR.  The drop in participation may have been due to more difficult and time-consuming data gathering required by the July mandate.

Preparing a Response

According to one source, some hospitals may not be required to report directly to the HHS data system if they are in a state that gathers the data and has worked out a deal with CMS that allows the state to do the reporting.  It is also important to note that many hospitals are already following the government’s guidelines.  For those facilities that currently fall in neither of these camps, they will need to make immediate preparations to comply with the new reporting mandates or risk significant loss of revenue.

We will continue to keep an eye of this issue and provide you with any new information that may prove helpful.  If we can assist you in other ways, please let us know.  Our business solutions can be found at www.miramedgs.com, and you can reach out to us at info@miramedgs.com.