Omnibus Appropriations Package Includes Changes for Medicare and Medicaid Beneficiaries

January 6, 2021

Update (Jan. 13, 2021): To assist the healthcare industry in understanding the policies included in the massive spending bill, our Jan. 13 alert summarizes 15 key healthcare provisions included in H.R. 133.

Passed by Congress Dec. 21, 2020, and signed by President Donald Trump Dec. 27, 2020, the $1.4 trillion omnibus Consolidated Appropriations Act includes numerous provisions that directly impact Medicare and Medicaid beneficiaries. To assist the healthcare industry in understanding the policies included in the provisions summarized below, this alert includes the House bill numbers introduced during the 116th Congress, which concluded at year’s end.

Medicare Provisions
  1. Extends coverage of immunosuppressive drugs for kidney transplant patients and includes other renal dialysis provisions (i.e., H.R. 5534)
  • Provides Medicare coverage for immunosuppressive drugs to post-kidney transplant individuals whose coverage under Medicare Part A otherwise ends post-transplant, and whose drugs are not covered by other insurance.
  • Current Medicare policy limits coverage for such drugs to 36 months following a transplant. This coverage will allow the post-transplant individual to enroll in Medicare Part B solely for purposes of coverage of such immunosuppressive drugs.
  • Authorizes a GAO study and report to Congress on this provision by Jan. 1, 2025.
  1. Waives Medicare co-insurance for certain colorectal cancer screening tests (i.e., H.R. 1570)
  • Beginning Jan. 1, 2022, gradually eliminates cost-sharing for Medicare beneficiaries by Jan. 1, 2030 (80 percent for 2022, 85 percent for 2023-2026, 90 percent for 2027-2029), for colorectal screening tests where a polyp is detected and removed.
  • Medicare policy created a situation where co-insurance is not charged when colorectal screenings show no polyps, but if a polyp is detected and removed, co-insurance is charged. This inconsistency was a Centers for Medicare & Medicaid Services (CMS) interpretation of previous legislation that provided coverage for colorectal screening exams. CMS determined that detection and removal of polyps was not a screening exam, so co-insurance should be charged.
  1. Continues coverage of certain temporary transitional home infusion therapy services (i.e., H.R. 6218)
  • Continues coverage of home infusion therapy services for beneficiaries taking self-administered and biological drugs included in the temporary transitional home infusion therapy benefit, when the permanent home infusion therapy benefit takes effect Jan. 1, 2021.
  • Starting Jan. 1, 2021, after a one-year transition period, CMS was to pay for these services solely under a new benefit to home infusion therapy suppliers pursuant to a provision in the 21st Century Cures Act. This provision will ensure beneficiaries can continue to receive certain eligible infusion drugs from their current provider notwithstanding this new benefit.
  1. Provides transitional coverage and retroactive Medicare Part D coverage for certain low-income beneficiaries (i.e., H.R. 3029)
  • Starting Jan. 1, 2024, permanently authorizes the Limited Income Newly Eligible Transition (LINET) demonstration to provide temporary Part D coverage for certain individuals with low-income subsidies during eligibility determinations.
  • Such coverage under the LINET demonstration program provides immediate access to covered drugs at the point of sale as soon as the individual becomes eligible for subsidies. The program’s coverage also applies retroactively for reimbursement to dual eligible individuals and those that receive benefits under the Supplemental Security Income program.
  1. Extends the Medicare IVIG access demonstration project (i.e., H.R. 7839)
  • Extends through Dec. 31, 2023, the Intravenous Immunoglobulin (IVIG) access Demonstration that is administered in-home. The provision also allows up to 2,500 additional Medicare patients with primary immunodeficiency diseases to enroll for a total of 6,500 patients.
  • Requires an updated evaluation of the demonstration.
  1. Increases the use of real-time benefit tools to lower beneficiary costs (i.e., H.R. 3408)
  • Requires Medicare Part D and Medicare Advantage plans to implement real-time benefit tools that can integrate with electronic prescribing and electronic health record (EHR) systems, which provide benefit and cost-sharing information to prescribing professionals.
  • Requires real-time benefit tools to comply with technical standards adopted by the Department of Health & Human Services (HHS) in consultation with the Office of the National Coordinator for Health Information Technology.
  • Qualifies the use of real-time benefit tools, as applicable, under the Merit-based Incentive Payment System (MIPS) program.
  1. Simplifies beneficiary enrollment (i.e., H.R. 2477)
  • Eliminates coverage gaps in Medicare by ensuring that Medicare Part B coverage begins the first of the month following an individual’s enrollment in Medicare Part A.
  • Provides the secretary of HHS the authority to establish a special enrollment period in Medicare Parts A and B beginning in 2023 similar to the authority in Medicare Advantage and Medicare Part D plans for exceptional circumstances.
  • Authorizes a report to Congress by Jan. 1, 2023, on how to align existing Medicare enrollment periods.
Medicaid Provisions
  1. Extends Money Follows the Person Rebalancing Demonstration
  • Extends funding for the Medicaid Money Follows the Person Rebalancing Demonstration program at $450 million per fiscal year through fiscal year 2023 (Sept. 30, 2023). Earlier legislative efforts this year extended the demonstration program, which was set to expire during calendar year 2020, as discussed in April 29 and Sept. 30 alerts.
  • Changes the institutional residency period from 90 days to 60 days to participate in the demonstration program and updates state application requirements to provide additional information on use of rebalancing funds.
  • Requires HHS to issue a report on best practices, and the Medicaid and CHIP Payment and Access Commission to issue a report on the types of home and community-based settings available to those participating in the demonstration program.
  1. Extends spousal impoverishment protections
  • Protections against spousal impoverishment for partners of Medicaid beneficiaries who receive home and community-based services are extended through fiscal year 2023.
  • Similar to the Money Follows the Person Rebalancing Demonstration program, these protections would have expired in 2020 without this provision and two earlier legislative efforts.
  1. Provides Medicaid coverage for citizens of Freely Associated States
  • Restores Medicaid eligibility for citizens of the Federated States of Micronesia, the Republic of the Marshall Islands and the Republic of Palau (the Freely Associated States) lawfully residing in the United States. Under the Compacts of Free Association, certain citizens of the Freely Associated States can travel, live and work in the United States without a visa. This provision excludes the five-year limit to Medicaid eligibility for such citizens.
  1. Covers routine costs of life-saving therapies for Medicaid enrollees
  • Requires state Medicaid programs to begin covering on Jan. 1, 2022, routine patient costs for items and services that are provided in connection with a qualifying clinical trial regarding serious or other life-threatening conditions, including treating complications from such studies. Qualifying trials will include those with government sponsors or an eligible clinical drug trial.

McGuireWoods and McGuireWoods Consulting are continuously monitoring legislation and regulations related to healthcare policy. Please contact the authors or a member of the McGuireWoods healthcare team for additional information. McGuireWoods Consulting’s federal team assists clients in communicating with policymakers on complex legislative issues related to healthcare, and McGuireWoods attorneys address ongoing, day-to-day obstacles and create new models for delivering healthcare services across the country.