young doctor examining medical x-ray images

The Omnibus Appropriations Bill passed by Congress supports medical residents with an additional Medicare-funded graduate medical education residency position if they serve in rural hospitals.

COVID-19 Relief and Omnibus Appropriations Bills: Health Overview

By Haley Nicholson | Jan. 29, 2021 | State Legislatures Magazine

Congress finally came together at the end of last year to pass coronavirus relief and appropriations funding.

Between the two bills, which were combined into one package, there were 5,600 pages containing many health and funding provisions. For NCSL’s top-line overview of items in the bills, click here; for highlights of the bills’ health provisions, read on.

Health issues addressed in the legislation ranged from lowering prescription drug costs to strengthening parity in mental health. Many of the issues, including funding for several essential health programs, also known as the “extenders,” were well past their timeline to receive funding: community health centers, the National Health Service Corps, teaching health centers participating in the graduate medical education program, and special diabetes programs. Public health programs received authorization to help expand and enhance state efforts, including in collecting and analyzing vaccination coverage data. The legislation also provides grants to state and local public departments to help modernize their data systems, including a requirement that the Department of Health and Human Services (HHS) consult with state and local health departments to carry out these activities.

One significant change was the strengthening of parity in mental health and substance use disorder benefits. Group health plans and insurance issuers that offer individual or group market coverage must do analyses of treatment limitations used for medical benefits in comparison to mental health and substance use disorder benefits.

The secretaries of HHS and the Departments of Labor and Treasury will be required to request analyses of at least 20 plans per year, with attention to potential violations of mental health parity or complaints of noncompliance. Any plans found in violation will be required to come into compliance within 45 days.

Medicare and Medicaid

In the Medicare and Medicaid spaces, several demonstration programs were extended and reauthorized. This included an extension of funding for:

On the medical payment front, several changes will be coming for Medicare and Medicaid. This includes a temporary freeze on Alternative Payment Models at current payment and patient count thresholds for physicians, with permanent authorization [MR1] [HN2] of those thresholds starting on Jan. 1, 2024.

Coverage gaps in Medicare will be eliminated by requiring changes to Medicare Part B insurance coverage start dates, and online access to mental health services for Medicare beneficiaries will be expanded. The bill also eliminated the current Medicaid Disproportionate Share Hospital (DSH) payment reductions for fiscal year (FY) 2021 through 2023 and added reductions in FY 2026 and FY 2027.

Support for Providers

Finally, for providers, several changes will be implemented in terms of payments for services, medical residency support and an extension of programs to help establish rural community hospitals.

The legislation includes a new, voluntary Medicare payment designation allowing a critical access hospital, or a facility with less than 50 beds, to convert to a rural emergency hospital, helping bring additional medical services to rural communities. Medical residents will be supported with an additional Medicare-funded graduate medical education residency position if they serve in rural hospitals or health professional shortage areas. Rural training tracks will be given greater flexibility for rural and urban hospitals participating in the programs.

These are just a few of the health-related highlights. NCSL has more information on health provisions, and has highlighted the federal bills’ human services issues. With states facing many health challenges ahead, this recent legislation may bring some much-needed relief.

Haley Nicholson is senior policy director, health, in NCSL’s State-Federal Program.

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