The Federal Emergency Management Agency (FEMA) is requiring hospitals to offset reimbursement requests for qualified COVID-19 expenses for any third-party claims payment for health care services. However, the agency has not offered any detailed guidance on how any patient care-related revenue should be offset, and is relying on hospitals to provide a methodology.
Given that public payers — Medicare and Medi-Cal — with limited exceptions, did not provide additional revenue to offset the increased costs associated with the pandemic for items such as personal protective equipment, labor, equipment, and other capital costs, the amount of patient care revenue that requires offsetting should be de minimis.
CHA has created summaries of how Medicare and Medi-Cal set payment rates. The purpose of these documents is to educate FEMA staffers and help them identify which payments — if any — from Medicare and Medi-Cal might require offsetting against qualified COVID-19 expenses. These documents can be included in applications for FEMA public assistance as an appendix to help justify the amount of patient care revenue offset for governmental payers.