Congress is finally passing the first six appropriations bills in a single package to fund the government through the rest of the fiscal year. The bipartisan partial spending package includes funding for various agencies and federal programs. Of interest, the package would eliminate cuts to Medicaid’s Disproportionate Share Hospitals (DSH), delaying them through the end of CY 2024; reduce the Physician Fee Schedule (PFS) payment cuts from 3.37% to 2.93%; and fund multiple programs relating to mental and behavioral health under Medicaid and CHIP. Notably missing from this spending package are site-neutral payment cuts, Pharmacy Benefit Manager (PBM) reforms, and changes relating to hospital price transparency.

What’s In?

Behavioral Health:

  • Makes permanent the requirements for Medicaid programs to cover treatments for opioid use disorders such as medication treatments, counselling services, and behavioral therapies.
  • Directs the Department of Health and Human Services (HHS) to publish annual reports on the services provided to Medicaid and Children’s Health Insurance Program (CHIP) beneficiaries related to mental health and substance abuse.
  • Extends requirements for states to monitor the prescribing practices of antipsychotic medications to include all children, including those in foster care, and adults in institutional care settings or receiving home and community-based care services. This requirement originally only applied to children and not the other populations.
  • Requires HHS to publish guidance for states to improve access to mental health care and substance use disorder treatment through Medicaid and CHIP.
  • Establishes the Certified Community Behavioral Health Clinic services as optional Medicaid benefits.

Workforce Development:

  • Extends funding for the Teaching Health Centers Graduate Medical Education Program, Community Health Centers, and the National Health Service Corps through the end of CY 2024.
  • Directs HHS to issue guidance for states to strengthen the behavioral health care workforce.

Provider Payment:

  • Delays cuts to the Medicaid DSH program through the end of CY 2024.
  • Extends incentive payments for qualifying participants to participate in advanced Alternative Payment Models (APMs) through 2026 and lowers the APM qualifying thresholds from 75% back to 50% for this performance year.
  • Temporarily increases payments under the Medicare PFS by 2.93% for services provided between March 9, 2024, and December 31, 2024. This partially reverses the 3.37% cut made to the PFS during rulemaking.
  • Extends the increased payment adjustment for the Medicare Low-Volume Hospital program through December 31, 2024.
  • Extends the Medicare-Dependent Hospital Program for three months through December 31, 2024.

What’s Out?

Various bills targeting PBM reforms, site-neutral payments, hospital price transparency, and Medicare Advantage were left out. This week, the White House held a round table discussion on how the Administration can pursue PBM reforms and lower drug costs. It is expected that some of these bills may be resurrected during negotiations for FY 2025 funding or during the lame duck session after the November elections – assuming Congress will pass the 2025 appropriations bills on time.

What’s Next?

Once the bill makes its way through the Senate today, Congress will then shift its focus to drafting the remaining six appropriations bills due by March 22nd, unless they pass another continuing resolution. Yesterday, in an interview with the Washington Journal, Rep. Brad Sherman (D-CA), Ranking Member of the Financial Services Subcommittee, said he is 60-70% sure Congress will pass the remaining appropriations bills by the March 22nd deadline.