CMS threatens to withhold funds from providers skirting COVID-19 requirements

August 25, 2020


CMS on Tuesday strengthened its COVID-19 testing and reporting requirements for nursing homes, hospitals and labs, warning the providers could get fined or have funding withheld if they don’t comply.

Under the interim rule, nursing homes need to routinely test staff and test residents whenever there is an outbreak. The frequency of staff testing will be tied to the rate of community spread in an area and will be outlined in guidance expected to be announced soon, CMS Administrator Seema Verma said.

Facilities that do not comply with the new requirements will be cited for noncompliance and could face fines of $400 per day or more than $8,000 for a case of noncompliance, CMS said. Facilities also could be denied payment for new admissions.

“These new rules represent a dramatic ramp up in our effort to track and control COVID-19 in nursing homes,” Verma said. “While we’ve had good compliance across the country, we want to make sure every single nursing home is doing this. If not, they’re going to face sanctions.”

Nursing homes will be aided in compliance by the 15,000 rapid point-of-care testing devices CMS previously announced it would send to nursing homes over the next few months and $5 billion in funding from the Provider Relief Fund, which was announced in July. CMS also earlier Tuesday launched a staff training program on infection control and prevention for CMS-certified nursing homes.

Under Tuesday’s rule, hospitals and critical access hospitals are now required to report COVID-19 related data daily. The data will include the number of confirmed or suspected COVID-19 positive patients, ICU beds occupied, and availability of supplies and equipment like ventilators and PPE, CMS said.

The agency will warn hospitals that miss a day and give them a few weeks to come into compliance before Medicaid and Medicare payments are withheld, Verma said. After that point, the hospitals could be terminated from the Medicare and Medicaid program.

Rick Pollack, president and CEO of the American Hospital Association, characterized the new rule as a “heavy-handed regulatory approach” that “should be reversed immediately.”

“This disturbing move, announced in final form without consultation, or the opportunity to provide feedback through appropriate administrative procedures prior to it becoming effective, could jeopardize access to care and leave patients and communities without vital health services from their local hospital during a pandemic,” Pollack said in a prepared statement.

He said health systems have made “a good faith effort” to meet reporting requirements while battling COVID-19, even though the federal government has made multiple changes in reporting requirements throughout the pandemic.

“It’s beyond perplexing why CMS would use a regulatory sledgehammer — threatening Medicare participation — to the very organizations that are on the frontlines in the fight against COVID-19,” Pollack said.

Facilities completing COVID-19 testing — including nursing homes and hospital labs — will be required to report COVID-19 rest results daily. Those that don’t comply will face a fine of $1,000 for the first day and $500 for each subsequent day, CMS said. There will be a three-week grace period to begin reporting the data.

There will be a 60-comment period for the new interim rule, CMS said.

In addition to the new testing and reporting requirements, CMS also on Tuesday revised its coverage of testing for Medicare beneficiaries.

Medicare beneficiaries can receive on COVID-19 test without an order from a physician or health practitioner. Previously, beneficiaries could receive repeated COVID-19 testing. CMS said the change was “designed to stop fraudsters from performing or billing for unnecessary tests.”