Physician Practices Want More from Provider Relief Fund

Future Provider Relief Fund distributions should prioritize allocation to physician practices struggling with the financial consequences of the COVID-19 pandemic, not just hospitals, physician groups are telling lawmakers.

Physicians who practice outside of hospital systems have invested thousands of dollars in infrastructure to support telehealth and COVID-19 testing and vaccination during the pandemic, America’s Physician Groups (APG) told Senator Chuck Schumer (D-NY) in a March 25th letter.

However, independent physicians “were not the focus of previous distributions of dollars” through the Provider Relief Fund, which instead went largely to hospitals, the group added.

“It is imperative that additional funding uses a more targeted approach to ensure that those providers that are most affected by the ongoing pandemic receive the funds needed to continue their efforts in serving their patient populations and assisting them with the resulting financial challenges that have affected areas of care,” APG wrote in the letter.

The group representing over 340 physician groups that employ or contract with approximately 195,000 physicians also asked for forgiveness of the loans provided by the accelerated and advanced payment programs and to delay the Medicare sequestration.

Signed into law in March 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act established the Provider Relief Fund. The Fund includes $178 billion, which HHS is to distribute directly to healthcare providers experiencing lost revenues and added costs because of the pandemic.

HHS has distributed approximately $148.4 billion to providers so far through general and targeted allocations, according to an analysis released last month by the American Hospital Association (AHA).

More of the funds went to hospitals with more private payer revenue and larger operating margins, a Kaiser Family Foundation (KFF) analysis from the start of the pandemic showed.

But independent physician practices have also suffered financially throughout the pandemic, APG stated.

According to APG’s numbers, total number of visits for all specialties has declined by as much as 7 percent compared to a baseline from the beginning of the pandemic in March 2020. Specialty care providers, such as pediatricians, physical therapists, and surgical specialists, saw the most impact.

Additionally, chronic Medicare patient visits in both fee-for-service and Medicare Advantage are down by 17 percent compared to the baseline among some APG members.

“As physicians have worked diligently to responsibly offer care to patients that adheres to social distancing restrictions and offer protection while maintaining accessibility for those that need to be seen, the resulting effect on visit volume for practices has been extensive,” the group stated.

The financial effects of the ongoing pandemic are also straining value-based care capabilities despite years-long efforts to get physicians to transition away from fee-for-service.

“Value-based programs are also in dire need of increased supplies and staffing as providers and facilities in these zones are being utilized at or near capacity, in addition to assisting with dealing with the financial fallout from the COVID-19 pandemic,” APG wrote. “As a result of the pandemic, value-based programs have experienced decreases of approximately five percent in each category of attribution, quality, and risk adjustment due to changes in visit volume that will impact shared savings opportunities.”

Extending Provider Relief Fund money toward physicians and non-hospital-based practices would also offset the additional costs of COVID-19 testing and vaccinations as well as reduced patient volumes, the group reasoned.

In addition to more targeted funding, APG also called on lawmakers to consider changes to the Medicare Accelerated and Advance Payment Programs to “avoid adding onto existing financial pressures.”

CMS turned on the programs early during the pandemic to provide advanced, upfront reimbursement to providers based on historical volumes to offset depressed volumes. The agency doled out approximately $100 billion in aggregate reimbursements to providers, with about 8 percent of the funds going to Part B providers, according to KFF.

Providers have to repay CMS for the advanced reimbursements and have received some reprieve from Congress because of ongoing financial struggles. However, total loan forgiveness would “play an integral role in providing physicians with financial assistance amidst the current pandemic considering the extent of the changes that have been made to infrastructure, and the disruption to service that has occurred during this pandemic,” APG contended.

The group also asked Congress to consider extending the temporary suspension of the 2 percent Medicare sequester to further support practices.

The Senate passed a bill last week that would extend the suspension through 2021.