American College Of Surgeons - Inspiring Quality: Highest Standards, Better Outcomes

End-of-Year Funding Bill Packed with ACS Legislative Victories

In a whirlwind finish, Congress passed a last-minute funding and COVID-19 relief package on December 21, 2020. The bill, the Consolidated Appropriations Act of 2021 (H.R. 133) was signed into law by President Trump on December 27, 2020. The $1.4 trillion spending package funds the federal government through the fiscal year 2021 and includes $900 billion in stimulus funds and relief policies in response to the COVID-19 pandemic. Due to significant efforts by ACS fellows through grassroots and coalition lobbying efforts led by the ACS Division of Advocacy and Health Policy team, several ACS supported provisions were included in this package, ranging in scope from physician payment, including stopping the planned Medicare physician cuts for 2021; cancer issues; workforce and rural health; and health IT, among other achievements.

Physician Payment

Stopped significant physician payment cuts for 2021. Prior to the enactment of H.R. 133, the 2021 Physician Fee Schedule rule finalized by the Centers for Medicare and Medicaid Services included increases to reimbursement for evaluation and management (E/M) services, which in turn would decrease overall reimbursement for PFS services due to the statutory "budget neutrality" requirement. Surgical specialties were facing up to 9 percent cuts to Medicare payment in 2021. The following relief will eliminate the cut for most surgical specialties:

  • Increases payment to all PFS services by 3.75 percent to mitigate the impact of the budget neutrality cuts. This is paid for by transferring $3 billion into the PFS for 2021.
  • Delays for three years the implementation of G2211 (formerly GPC1X), a complex add-on code used primarily by office-based specialties. This will further reduce by 1/3 the impact of the budget neutrality cuts.

This legislative victory would not have been possible without ACS member participation, including a record-breaking number of grassroots efforts to contact Congress about this critical advocacy priority. This issue remains a top priority for the ACS, and we will continue our advocacy efforts in 2021.

Delay of Medicare sequestration cuts. Congress included a provision that temporarily delays scheduled sequestration cuts of 2 percent on all Medicare provider reimbursement until March 31, 2021. The cuts were previously set to come into effect on December 31, 2020. Congressional advocacy continues to extend the relief through the duration of the COVID-19 public health emergency.

Surprise billing compromise. A revised version of the No Surprises Act was included in the legislation. Starting January 1, 2022, plans and providers (including hospitals, facilities, individual practitioners and air ambulance providers) are prohibited from billing patients more than in-network cost-sharing amounts. The prohibition applies to emergency care and to certain non-emergency situations where patients do not have the ability to choose an in-network provider.

To reconcile payment disputes between plans and providers, the legislation directs a 30-day open negotiation between the parties, and then a prescribed independent dispute resolution process if negotiations fail. Specifically, the IDR process includes the following:

  • No minimum dollar threshold for claims eligible for IDR.
  • Batching of claims for similar services when claims are from the same payer.
  • IDR entities shall be independent, unbiased entities with no affiliation to providers or payers.

The IDR entity is required to consider the market-based median in-network rate, alongside relevant information brought by either party; information requested by the reviewer, as well as factors such as the provider's training and experience; and patient acuity and the complexity of furnishing the item or service. In the case of a provider that is a facility, the IDR entity shall consider the teaching status, case mix and scope of services of such facility. Additionally, they are required to consider demonstrations of good faith efforts (or lack thereof) to enter into a network agreement and prior contracted rates during the previous four plan years. Billed charges and public payer rates are excluded from consideration. Following IDR, the party that initiated the process may not take the same party to IDR for the same item or service for 90 days following a determination by the IDR entity in order to encourage settlement of similar claims. However, all claims that occur during that 90-day period may still be eligible for IDR upon completion of the 90-day period.

This surprise billing legislation is a dramatic shift from the initial plan offered in 2018 that would have allowed the health plans to pay the median in-network rate to out-of-network physicians that were not chosen by the patient and with no opportunity for an independent review. The ACS had actively opposed initial surprise billing legislation and many subsequent versions because they all lacked a strong independent review process and they relied too heavily on the median in-network payment rate. The Congressional Budget Office had indicated that a reliance on the median in-network rate would drive down payment rates for out-of-network providers as well as in-network providers. While the legislative language is not perfect, and the ACS did not support it, the language is significantly improved compared to where the legislation stood two years ago.

Medicare Accelerated and Advance Payment Program. In response to the COVID-19 pandemic, Congress expanded the existing Medicare Accelerated and Advance Payment Program to help address cash flow disruptions for hospitals and health care providers. Providers that received the advanced and accelerated payments were scheduled to begin repayment of those loans in August 2020, but CMS delayed the start of repayment at that time. In the previous government funding legislation, the Continuing Appropriations Act, 2021 and Other Extensions Act (H.R. 8337), signed into law on October 1, 2020, Congress gave hospitals and other providers that received Medicare accelerated and advance payments one year from when the first loan payment was made to begin making repayments, delaying the start of the repayment period to spring of 2021. While H.R. 133 did not make any additional changes to the legislation, it included a provision for a Congressional report providing a full accounting, including methodology, of federal loans provided in fiscal years 2020 and 2021 through the Medicare Accelerated and Advanced Payments Program.

Provider Relief Fund. The legislation includes an additional $3 billion for the Provider Relief Fund (PRF) for eligible health care providers for healthcare-related expenses and/or lost revenues associated with COVID-19. It made the following additional clarifications to the PRF:

  • Ensures 85 percent of future Provider Relief Fund distributions are allocated equitably via applications that consider financial losses and changes in operating expenses.
  • Provides additional certainty to providers by clarifying that payments made prior to September 19, 2020, must be calculated using the guidance released by HHS on June 19, 2020. The change expressly allows providers to account for lost revenues using the difference between the provider's budgeted and actual revenue if the budget was established and approved before March 27, 2020.
  • Allows additional flexibility for providers by clarifying that eligible health care providers may transfer all or any portion of such payments among the subsidiary eligible health care providers of the parent organization.

Temporary freeze of APM payment incentive thresholds. This legislation temporarily freezes the thresholds for participation in alternative payment models through 2024. The percentage of payments for services furnished via an eligible APM entity to qualify for APM participation were scheduled to increase beginning in 2023 and are now set to increase beginning in 2025.

Workforce and Rural Health

Creation of 1,000 new GME slots. As part of the bill, Congress added 1,000 new Medicare-funded graduate medical education full-time equivalent residency positions, beginning in fiscal year 2023, which will be available to the following groups:

  • Rural hospitals and hospitals treated as rural hospitals
  • Hospitals over their otherwise applicable resident limit
  • Hospitals in states with certain new medical schools and medical schools with additional locations and branch campuses
  • Hospitals that serve Health Professional Shortage Areas

GME rotators. Congress included language allowing hospitals to host a limited number of residents for short-term rotations without being negatively impacted by a set permanent FTE resident cap or a Per Resident Amount.

Promoting rural hospital GME funding opportunity. Congress made changes to the Medicare GME Rural Training Tracks program in order to provide greater flexibility for rural and urban hospitals to partner and address the physician workforce needs of rural areas.

Medicare Work Geographic Index (GPCI) Floor. Extends through December 2023 the increased payments for the work component of physician fees in areas where labor cost is determined to be lower than the national average.

Medicare payment for rural emergency hospital services. Congress created a new voluntary Medicare payment designation, Rural Emergency Hospital, in an effort to preserve beneficiary access to emergency services in rural locations that can no longer support a fully functional inpatient hospital. The new payment designation allows a critical access hospital or a rural hospital with less than 50 beds to apply to convert to an REH and be reimbursed based on the Medicare Outpatient Prospective Payment System plus 5 percent to reflect higher costs of such hospitals. To be considered an REH, the facility must not provide any acute inpatient care, must have a transfer agreement with Level I or II trauma centers and must meet certain emergency staffing requirements. An REH may provide observation care, skilled nursing facility services, ambulance services, and telehealth services.

Cancer Issues

Several of the ACS' long term cancer-related priorities were passed in the final package.

Report language recognizing ACS Cancer Programs. Congress included language in the accompanying bill report recognizing the importance of the ACS Cancer Programs in ensuring high quality cancer care. The included report language reads:

"Quality Care for Cancer: The agreement is aware of voluntary accreditation by the American College of Surgeons Cancer Programs and supports voluntary accreditation efforts that improve performance evaluation and inform quality care improvements."

Increased access for colorectal screening rests for Medicare beneficiaries. Congress included the Removing Barriers to Colorectal Cancer Screening Act (H.R. 1570/S. 668), which will gradually eliminate cost-sharing for Medicare beneficiaries with respect to colorectal cancer screening tests where a polyp is detected and removed, thus closing a loop-hole. The cost-sharing requirements will be fully waived by 2030. H.R. 1570/S. 668 and was a long time priority of the ACS Commission on Cancer and the cancer community at large.

Expanded access to clinical trials in Medicaid. As part of the final legislation, Congress passed the CLINICAL Treatment Act (H.R. 913), which will require Medicaid to cover routine care costs for patients with life threatening conditions who are enrolled in clinical trials.

Cancer funding. Specific funding breakdowns are as follows:

  • National Institutes of Health: The bill provides a total of $42.9 billion for NIH, an increase of $1.25 billion above the FY20 enacted level.
    • National Cancer Institute: $6.559 billion, a $119.5 million increase.
    • Cancer Moonshot: $195 million.
  • Centers for Disease Control and Prevention Cancer Prevention and Control Programs: $385,799,000, and increase of nearly $5 million over FY20 funding levels.
    • Cancer Registries: $51,440,000

Appropriations and Extenders

Firearms research funding. Funding for firearm injury and prevention research was once again included in this spending package. The CDC and NIH will each receive $12.5 million to fund this research. The continued allocation marks only the second year that federal funding has been specifically designated to firearms research in more than 20 years. This effort continues to be an ACS Committee on Trauma priority and is marked by the efforts of ACS COT advocates via grassroots, testimony, and research.

Additional extenders. The omnibus extends funding for several so-called "health extenders," programs whose authorizations and/or funding were previously scheduled to lapse on December 21, 2020. Some of the programs funded through 2023 include the following:

  • Community Health Centers: Extended at $4 billion/year through FY 2023.
  • National Health Service Corps: Extended $310 million/year through FY 2023.
  • Teaching Health Center Graduate Medical Education Programs: Extended at $126.5 million through FY 2023.
  • Rural Community Hospital Demonstration Program: Extended for an additional five years. This provision also expands the eligibility of certain rural community hospitals for the demonstration.
  • Medicare CHGME: Provides $340 million in annual funding for Children's Hospitals Graduate Medical Education, an increase of $15 million.
  • EMSC: Provides $22,334,000 in annual funding for the Emergency Medical Services for Children, same level as FY20.

Health IT

Expanding access to mental health services via telehealth: Congress passed H.R. 1301, which expands access to telehealth services in Medicare to allow beneficiaries to receive mental health services via telehealth, including from the beneficiary's home. To be eligible to receive these services via telehealth, the beneficiary must have been seen in person at least once by the physician or non-physician practitioner during the six months period prior to the first telehealth service, with additional face-to-face requirements determined by the Secretary.

FCC COVID-19 Telehealth Program: Congress appropriated an additional $250 million for the FCC's COVID-19 Telehealth Program, originally authorized under the CARES Act. It also establishes significant new transparency and reporting requirements regarding the FCC's review of applications and directs the Commission to ensure that all states benefit from the program to the extent feasible.

Public health data system modernization. Congress appropriated $100 million a year for five years to the CDC to modernize and improve interoperability for its public health data systems and to award grants for the improvement of state, local, tribal and territorial public health data systems. The CDC is now required to work with the Office of the National Coordinator for Health Information Technology to develop public health data standards.

Ongoing efforts to support creation of patient identification solutions. As part of its ongoing advocacy efforts surrounding patient matching, the ACS worked with a broad coalition to remove language prohibiting HHS from spending federal dollars to adopt a Unique Patient Identifier. In June of 2020, the U.S. House of Representatives passed an amendment repealing the 20-year ban. Unfortunately, Congress did not finalize the repeal in the year end spending package but include the following report language:

"The agreement notes the general provision limiting funds for actions related to promulgation or adoption of a standard providing for the assignment of a unique health identifier does not prohibit the Department from examining the issues around patient matching, and continues to encourage the Department to provide technical assistance to private-sector-led initiatives to develop a coordinated approach that will promote patient safety by accurately identifying patients to their health information. Additionally, the agreement expects to receive the report requested in the explanatory statement accompanying the Further Consolidated Appropriations Act, 2020 (Public Law 116-94) on current methods and recommended actions to increase the likelihood of an accurate match of patients to their health care data."

Other End-of-Year Legislative Wins

Repeal of McCarran-Ferguson antitrust exemption for health insurers. On December 22, 2020, the Senate passed the Competitive Health Insurance Reform Act, which previously passed by the House in September. This legislation, which was signed by President Trump on January 13, limits the antitrust exemption available to health insurance companies under the McCarran-Ferguson Act. The Competitive Health Insurance Reform Act was sponsored in the House by Reps. Peter DeFazio (D-OR) and Paul Gosar (R-AZ) and in the Senate by Sens. Steve Daines (R-MT) and Patrick Leahy (D-VT). The ACS supported this legislation, as it is an important step forward in helping to level the negotiating playing field between providers and health plans.

For further information regarding any of the above issues or related to ACS congressional priorities in the 117th Congress, contact Kristin McDonald, ACS Manager of Legislative and Political Affairs, at