New York Congressional Delegation Questions Allocation Methodology for $30 Billion in COVID-19-Related Funding

April 9, 2020

Twenty-five members of the New York Congressional delegation have sent the attached letter to Health & Human Services (HHS) Secretary Alex Azar and Centers for Medicare & Medicaid Services Administrator Seema Verma about the initial $30 billion disbursement from the $100 billion Public Health and Social Services Emergency Fund in the CARES Act. The delegation letter raises major concerns with HHS’s methodology for allocating these funds.

GNYHA strongly supports the letter and worked to ensure that New York delegation members signed on.

The distribution of the first $30 billion will be based solely on a provider’s proportionate share of Medicare fee-for-service payments nationally (Medicare Part A and Part B) and doesn’t account for the intensity of the COVID-19 crisis in a provider’s geographic area. The New York delegation letter requests that this methodology be reconsidered because it doesn’t take into account the needs of the health care providers in COVID-19 “hot spots.”

GNYHA reached out to the entire New York Congressional delegation earlier this week to explain why HHS’s methodology is woefully insufficient to address the financial challenges facing hospitals at this time, especially those located in hot spot areas. We discussed how the methodology particularly disadvantages providers with a high proportion of uninsured, Medicaid, or Medicare Advantage patients, and other types of providers such as children’s hospitals and nursing homes.

We are extremely grateful to the 25 delegation members who contacted the Administration about this important issue. We especially thank Representatives Tom Suozzi (D-NY), Peter King (R-NY) and Eliot Engel (D-NY), who led this letter.

Next Steps

While HHS is unlikely to reconsider its methodology before releasing the first $30 billion, we expect that the next tranche of funding will use a different, more targeted methodology (but not necessarily one that explicitly targets hot spots). GNYHA will be active on Capitol Hill to ensure that future disbursements take into account the challenges facing providers in hot spot areas like the New York City region, and that funding is released as soon as possible.

GNYHA will also continue to engage with the Trump Administration and discuss the needs of hospitals and health care workers on the frontlines of the COVID-19 crisis. We sent a letter earlier this week to HHS Secretary Azar highlighting the need to prioritize funding to providers in hot spot areas to address the massive expenses related to health care “surge” activities, treating COVID-19 patients, and lost revenues.

We will keep you informed of all relevant activities in Washington and our advocacy efforts.

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