NY reps question federal formula for first $30B in stimulus aid

WASHINGTON — New York will get less money than needed from the first $30 billion of federal coronavirus aid for hospitals because the allocation is being based on the number of Medicare recipients, not incidence of COVID-19, the New York congressional delegation said Friday.

New York, the U.S. epicenter of the pandemic with 35% of the cases, will get $1.86 billion — less than the $2.9 billion for California with 4% of the cases, $2.2 billion for Florida with 3.6% of the cases, and $2.1 billion for Texas with 2.2% of the cases, federal data shows.

“It’s just wrong that New York state hospitals are not getting the money that they need in this crisis,” said Rep. Thomas Suozzi (D-Glen Cove), who led the delegation letter with Rep. Peter King (R-Seaford) and Rep. Elliot Engel (D-Bronx).

“They’re basing this on totally nonsensical statistics: Medicare numbers from 2019. And that has nothing to do with the crisis that’s going on right now,” Suozzi said. “The intention of Congress was to take care of those places that needed the help the most.”

Suozzi pointed out that while New York has 35% of the cases it is getting just 6% of the $30 billion being distributed. Both Suozzi and King said they hoped politics aren’t the reason.

“This is a real shortchanging of New York. I don’t know if it was done intentionally or by accident or whatever,” King said of the HHS announcement that it would electronically transfer those funds Friday.

“We’re going to keep on fighting for funds,” Suozzi said of the remaining $70 billion in health care provider relief funds from the $2.2 trillion CARES Act.

HHS said in its guidance that using the Medicare formula was quickest way to distribute the first $30 billion of the total $100 billion for health care providers in the $2.2 trillion relief package enacted at the end of March.

“Recognizing the importance of delivering the provider relief funds in a fast, fair, and transparent manner, this initial broad-based distribution of the relief funds will go to hospitals and providers across the United States that are enrolled in Medicare,” HHS said in its guidance.

But New York hospitals pushed back against this method, though the Greater New York Hospital Association said it does not expect HHS to reconsider. HHS said it will distribute the $1.86 billion in funds among 26,282 hospitals, health systems and health care providers in New York.

“This distribution methodology is woefully insufficient to address the financial challenges facing hospitals at this time, especially those located in hot spot areas such as the New York City region,” said the association’s president, Ken Raske, in a statement.

“It also disadvantages providers in regions with high Medicare Advantage penetration (because they are only using Medicare FFS payments), as well as providers treating high proportions of Medicaid beneficiaries,” he said.

HHS said it would target the next $70 billion of the health care provider relief funds to areas coping with the brunt of the epidemic.

“HHS and the administration are working rapidly on additional targeted distributions to providers that will focus on providers in areas particularly impacted by the COVID-19 outbreak, rural providers, and providers of services with lower shares of Medicare FFS reimbursement or who predominantly serve the Medicaid population,” HHS said in its guidance.

“This supplemental funding will also be used to reimburse providers for COVID-19 care for uninsured Americans,” it said.

“Several of our member CEOs have spoken with Secretary [Alex] Azar, and I have spoken with White House senior adviser Jared Kushner,” Raske said.

“While an exact distribution methodology for the next tranche of funds has not yet been identified, we have been assured that COVID-19 hot spots will be prioritized,” he said. “Our team is working on a variety of methodologies.”