AHA Asks Congress Again for More COVID-19 Financial Relief

The American Hospital Association (AHA) has penned a letter to Congressional leaders, asking once again for additional COVID-19 financial relief for hospitals and health systems.

The trade organization expressed its disappointment that Congress is adjourning for its April recess without providing critical financial assistance to hospitals, including Medicare sequester relief and additional Provider Relief Funds.

The letter voiced appreciation for congressional efforts to provide more funding for COVID-19 testing, treatments, and vaccines. However, AHA stressed that healthcare providers and hospitals continue to face financial and operational challenges during the pandemic.

The organization urged Congress to offer additional COVID-19 Provider Relief Funds, which have been distributed throughout the pandemic to support healthcare providers that lost revenue due to COVID-19-related changes. AHA said that these funds have been exhausted.

Additionally, providers did not receive any funds to address the expenses related to the Delta and Omicron surges, which led to rising case numbers, hospitalizations, and death.

AHA referenced a recent Kaufman Hall report that revealed hospital operating margins were negative in February 2022 for the second consecutive month. Meanwhile, hospitals saw declines in patient volumes and revenues.

Hospital expenses also increased, with total expense per adjusted discharge rising 30 percent, labor expense per adjusted discharge climbing 32 percent, and drug expense per adjusted discharge up by 41 percent in February.

According to AHA, hospitals are facing higher expenses due to supply chain disruptions, workforce shortages, and increased labor costs. In addition, health systems are struggling financially due to stagnant reimbursement rates that do not reflect increases in inflation.

The letter also noted that Congress failed to extend the moratorium on Medicare sequestration. Lawmakers had previously passed legislation to pause the 2 percent Medicare payment cuts until April 1, with plans to lower the cut to 1 percent for the following three months.

Now that the April deadline has passed, providers will face a 1 percent cut in Medicare reimbursement until July 1, when the full 2 percent sequester will resume.

AHA estimated that hospitals will lose $3 billion by the end of the year due to Congress not extending the sequester relief.

“Now is not the time to reduce payments to hospitals, especially while a new COVID-19 variant is on the rise and healthcare providers continue to suffer from immense financial burdens brought on by the pandemic,” the letter stated.

AHA also asked Congress to provide additional flexibility in the repayment terms for Medicare accelerated and advance repayments. In a previous letter sent to Congress in March 2022, the trade organization asked leaders to suspend repayments for six months and allow for recoupment after the repayment suspension at 25 percent of Medicare claims payments for the following year.

In the March letter, AHA also urged Congressional leaders to maintain Hospital at Home waivers and telehealth waivers following the end of the public health emergency.

AHA has sent several letters to Congress during the past few months, emphasizing the continuous challenges that hospitals are facing and requesting additional financial resources.