After the Public Health Emergency: Implications for Medicare and U.S federal health care policies

During the PHE, the U.S Department of Health and Human Services (HHS), including the Centers for Medicare & Medicaid Services (CMS) and the Office of Inspector General (OIG), implemented a number of waivers and flexibilities to account for the extraordinary circumstances of the COVID-19 pandemic. Among other things, these emergency policies affected myriad federal health care program requirements, including telehealth requirements, physician supervision rules, provider and supplier enrollment requirements, Medicare Conditions of Participation, COVID-19 vaccine and diagnostic testing policies, and countless other policies affecting providers, laboratories, physicians, and health care plans. Emergency waivers and flexibilities also had significant downstream ramifications for drug and device manufacturers and other entities with businesses indirectly connected to federal health care programs.

Many of these waivers and flexibilities will expire when the PHE ends or shortly thereafter.^[1] Some emergency policies are required by law to terminate immediately at the end of the PHE. For other policies, however, HHS has greater flexibility in phasing out the policy or—in certain cases—could elect to make the policy permanent even after the PHE expires.

Below we highlight some of the key HHS waivers or flexibilities tied to the PHE and the implications of the PHE expiration on these emergency policies.

A.     COVID-19 Vaccination and Diagnostic Testing

• Medicare Fee-for-Service Reimbursement and Cost-Sharing Policies for COVID-19 Vaccines and Certain Monoclonal Antibodies.

  • During the PHE: Medicare beneficiaries have been able to receive approved or authorized COVID-19 vaccines and monoclonal antibodies without cost-sharing. CMS has also established a special payment rate for vaccine administration, which is (as of 2023) generally $41.52 per dose for vaccine administrations (and CMS also makes an additional payment of $36.85 when a vaccine is administered in a beneficiary’s home and certain requirements are satisfied).[2] In addition, CMS has implemented a special payment for COVID-19 monoclonal antibodies, which is generally $450 when furnished in a health care setting (or generally $750 when administered in the patient’s home and certain requirements are satisfied).[3]

  • When the PHE expires: Beneficiaries will continue indefinitely to obtain COVID-19 vaccines without cost-sharing when the PHE ends. For monoclonal antibodies, the waiver of cost-sharing will not extend indefinitely—but CMS has also not tied the end of the waiver of cost-sharing directly to the end of the PHE. Rather, CMS has tied termination of the cost-sharing waiver for monoclonal antibodies to the end of the Food and Drug Administration’s (FDA’s) Emergency Use Authorization (EUA) declaration.[4] Specifically, cost-sharing will begin to apply to monoclonal antibodies starting January 1 of the year after FDA terminates the EUA declaration.[5] CMS’s special payment rules for practitioners (e.g., special $30 payment rate for most vaccine administration services, special $450 payment rate for most monoclonal antibody administrations) will also generally continue until January 1 of the year after the EUA declaration terminates, but will expire thereafter.[6]

• Medicare Fee-for-Service Policy Allowing Certain Non-Enrolled Practitioners to Order COVID-19 Tests.

  • During the PHE: Since August 24, 2020, CMS has permitted pharmacists and other health care professionals who may order diagnostic tests under their applicable state law to order covered COVID-19 and related tests where certain requirements are met.[7]

  • When the PHE expires: This flexibility will terminate with the end of the PHE, and Medicare will no longer pay for COVID-19 and related tests ordered by health care professionals who are not enrolled in Medicare.[8]

• COVID-19 Test Price Transparency.

  • During the PHE: The CARES Act requires “[e]ach provider of a diagnostic test for COVID-19” to “make public the cash price for such test on a public internet website” during the PHE.[9] In October 2020, CMS issued an interim final rule o implement this requirement.[10] Providers are required to post the “cash price” of COVID-19 diagnostic tests on their public internet websites or risk potential civil monetary penalties of up to $300 per day.^[11]

  • When the PHE expires: The requirement on providers to post the cash price of COVID-19 diagnostic tests terminates with the end of the PHE.^[12]

B.     Medicare Fee-for-Service: Telehealth

During the PHE, CMS implemented many waivers and flexibilities to enable access to telehealth services (and related remote technology services) to be covered by Medicare. Below is a summary of how the expiration of the PHE will affect several notable telehealth related emergency policies.

• Telehealth Services for Medicare Beneficiaries in Any Geographic Area in the United States.

  • During the PHE: CMS has waived the statutory and regulatory geographic requirements that limited telehealth coverage to designated locations and permitted telehealth services to be “furnished to patients wherever they are located, including in the patient’s home.”[13]

  • When the PHE expires: The geographic waiver will continue after the PHE expires. The Consolidated Appropriations Act, 2023 (CAA) extended the waiver through December 31, 2024.[14]

• Expansion of Practitioners Who Can Deliver Telehealth Services for Medicare Beneficiaries Covered and Paid Under the Medicare Physician Fee Schedule (PFS).

  • During the PHE: CMS has waived restrictions on the types of practitioners who can furnish and bill for distant site telehealth services.[15] Under the emergency waiver, all health professionals who are eligible to bill Medicare are permitted to furnish distant site telehealth services, including physical therapists and occupational therapists.

  • When the PHE expires: The waiver of practitioner type restrictions will continue after PHE expires. The CAA extended the waiver through December 31, 2024.[16]

• Telehealth Services for Medicare Beneficiaries provided by Hospital Outpatient Departments.

  • During the PHE: CMS has implemented a waiver that permits certain telehealth services to be treated as hospital outpatient department services. Specifically, a physician or nonphysician practitioner who typically furnishes professional services in the hospital outpatient department has been permitted to furnish telehealth services to a patient’s home as a “distant site” practitioner and bill with a hospital outpatient place of service.[17] The physician or practitioner has been paid for the service under the PFS at the facility rate, and the hospital has been permitted to bill under the Medicare Outpatient Prospective Payment System (OPPS) for the originating site facility fee associated with the telehealth service.[18]

  • When the PHE expires: This emergency policy will expire with the end of the PHE. Providers from hospital originating sites will not be able to bill the telehealth service provided in the patient’s home as if it was provided at the hospital.[19]

• Audio-Only Telehealth Services for Medicare Beneficiaries under the Medicare PFS.

  • During the PHE: The Secretary has allowed clinicians paid under the PFS to furnish certain services to beneficiaries through audio-only technology. CMS has indicated the purpose of this policy is so that all beneficiaries (including both new and established patients) can receive Medicare telehealth and other communications technology-based services wherever they are located.[20]

  • When the PHE expires: The waiver expanding audio-only telehealth services will continue after the PHE expires. When Congress enacted the CAA, it extended the waiver creating flexibilities for use of audio-only technology through December 31, 2024 .[21]

• Routine Home Care Hospice Services though Telecommunications Technology.

  • During the PHE: Hospice providers has been able to provide services to a Medicare patient receiving routine home care through telecommunications technology, when feasible and appropriate to do so.[22]

  • When the PHE expires: Routine home care services may no longer be provided through telecommunications technology when the PHE ends.[23]

• Patient Recertification for Hospice Services through Telehealth.

  • During the PHE: The CARES Act authorized patient recertification visits to be conducted by physicians or hospice nurse practitioners through telehealth.[24]

  • When the PHE expires: The waiver permitting telehealth recertification will continue after the PHE expires. The CAA extended the waiver through December 31, 2024.[25]

• Controlled Substances Prescribed without an In-Person Medical Evaluation.

  • During the PHE: Drug Enforcement Administration (DEA) registered practitioners have been permitted to issue prescriptions for all Schedule II-V controlled substances to patients without an in-person medical evaluation, when (1) the prescription is issued for a legitimate medical purpose by a practitioner acting in the usual course of his or her professional practice; (2) the telemedicine communication is conducted using an audio-visual, real-time, two-way interactive communication system; and (3) the practitioner is acting in accordance with applicable federal and state laws.[26] Further, practitioners have been permitted to prescribe a controlled substance to a patient using telemedicine, even where the patient is not at a hospital or clinic registered with the DEA.[27] Qualifying practitioners have also notably been permitted to prescribe buprenorphine to new and existing patients with opioid use disorder based on a telephone evaluation.[28]

• When the PHE expires: Prescriptions for a controlled substance issued by means of the internet (including telemedicine) may only be issued after an in-person medical evaluation when the PHE ends.[29] If the prescribing practitioner has previously conducted an in-person medical evaluation of the patient, the practitioner may issue a prescription for a controlled substance after having communicated with the patient via telemedicine so long as they comply with applicable federal and state laws.[30] Also note that DEA has proposed a rule that (if finalized) would continue the exemption from an in-person evaluation for a 30-day supply of the following controlled substances: (1) Schedule III-V non-narcotic controlled medications and (2) buprenorphine for the treatment of opioid use disorder.[31] The comment period for this proposed rule closes on March 31, 2023.

C.     Medicare Fee-for-Service: Hospital and Provider Policies and Physician or Practitioner Policies

During the PHE, CMS has sought to incentivize hospitals and other providers to provide COVID-19 treatments through several waivers and emergency flexibilities. Among numerous other things, CMS has temporarily permitted hospitals to operate or screen patients in non-traditional settings. CMS has also authorized various flexibilities affecting practitioners that bill under the PFS, including expanding types of clinicians who can treat patients and modifying the direct supervision rules for certain services billable under the PFS. Below is a summary of how the expiration of the PHE will affect several notable policies relevant to hospitals and other providers, as well as physicians and other practitioners.

• Enhanced Payment for Inpatient Treatment of COVID-19.

  • During the PHE: Beginning on November 2, 2020, CMS enhanced Medicare payment for certain inpatient stays where the patient was treated with new COVID-19 therapies through a New COVID–19 Treatments Add-On Payment.[32]

When the PHE expires: These payments will end on September 30, 2023—i.e., at the end of the fiscal year in which the COVID-19 PHE ends.[33]

• Separate Payment to Hospital Outpatient Departments for COVID-19 Treatment.

  • During the PHE: CMS has provided a separate payment for FDA authorized or approved drugs and biologicals used for the treatment of COVID-19 that are provided at the same time as a Comprehensive Ambulatory Payment Classification (C-APC) service and that would therefore otherwise ordinarily be packaged into the payment for the C-APC under the OPPS.[34]

  • When the PHE expires: This separate payment flexibility will expire when the PHE ends. Payment for these treatments will be packaged into the C-APC if billed on the same outpatient claim as the C-APC service.[35]

• Hospitals Without Walls Initiative.

  • During the PHE: CMS has created the Hospitals Without Walls initiative, which permits hospital services to be provided in non-hospital settings such as patients’ homes when certain conditions are satisfied.[36] Similarly, under the initiative, ambulatory surgical centers and independent, freestanding emergency departments have been permitted to temporarily enroll as hospitals.[37] Finally, the initiative has permitted hospitals to screen patients at offsite locations to prevent the spread of COVID-19.[38]

  • When the PHE expires: CMS has said that the original Hospitals Without Walls flexibility that allows hospital services to be provided “in health care facilities and sites not otherwise considered as part of a health care facility, or set up temporary expansion sites to help address the urgent need to increase capacity to care for patients” will cease “[w]hen the PHE ends, [and] hospitals will be required to provide services to patients within their hospital departments.” However, certain closely related Acute Hospital Care at Home initiative expansions to the original Hospitals Without Walls flexibility will be extended beyond the end of the PHE. Specifically, under the CAA, the flexibilities that allow a hospital to furnish inpatient services, including routine services, outside the hospital under arrangements are supposed to continue until December 31, 2024, as will the waiver of the 24-hour nursing services on premises and immediate availability of registered nursing requirements. CMS has also said hospitals can continue to apply to participate in the initiative. If an individual is receiving care in a participating hospital and meets the requirements to receive inpatient care at home, they can continue to do so. (See, CAA § 4140; CMS, "CMS Waivers, Flexibilities, and the Transition Forward from the COVID-19 Public Health Emergency" (Feb. 26, 2023).)

• Hospital Outpatient Department COVID-19 Related Specimen Collection.

  • During the PHE: Hospital outpatient departments have been able to be separately paid for COVID-19 related symptom assessment and specimen collection when billed using Healthcare Common Procedure Coding System (HCPCS) code C9803, when it is not billed with another covered hospital outpatient department service.[39] As of CY 2023, the national base payment rate for HCPCS code C9803 is slightly under $25.[40]

  • When the PHE expires: Payments to hospital outpatient departments for specimen collection related to COVID-19 testing will no longer be separately be paid, and CMS will discontinue HCPCS code C9803.^[41]

• Modification of the Direct Supervision Requirement.

  • During the PHE: CMS has temporarily modified the direct supervision requirement for certain services provided by non-physician practitioners.[42] Prior to the PHE, a supervising physician had to be “immediately available,” but this emergency flexibility has permitted supervision through virtual presence done via audiovisual technology.[43]

  • When the PHE expires: These modifications to the direct supervision requirement will end on December 31, 2023.[44]

• Waiver of the Three-Day Rule and Wellness Period Requirements for Skilled Nursing Facility (SNF) Coverage.

  • During the PHE: The waiver eliminates the three-day inpatient hospital stay prerequisite for coverage of a SNF stay and services.[45] For beneficiaries who have exhausted their SNF benefits, the waiver also authorizes renewed SNF coverage without a 60-day period of non-inpatient status (wellness period), but only for those patients for whom commencement of the 60-day wellness period was delayed or prevented due to the PHE.[46]

  • When the PHE expires: This waiver will terminate at the end of the PHE.

D.     Medicare Fee-for-Service: Laboratories and/or Laboratory-related Diagnostic Testing Policies

CMS has implemented numerous flexibilities related to laboratories and laboratory-related diagnostic testing policies, which have been intended to expand access to (and adequacy of reimbursement of) tests used for the detection of COVID-19.

• Special Laboratory Payment for High Throughput COVID-19 Diagnostic Tests.

  • During the PHE: Medicare has paid laboratories a higher payment rate for certain COVID-19 clinical diagnostic lab tests that use high-throughput technologies,[47] meaning tests that process more than two hundred specimens a day using certain sophisticated equipment and that require specially trained technicians and more time-intensive processes to assure quality.[48] This policy increased rates for such tests from approximately $51 to $100.[49]

  • When the PHE expires: Payment rates for these types of COVID-19 tests will revert to the standard rates under the Clinical Laboratory Fee Schedule.[50] The HCPCS codes that CMS created during the PHE to trigger enhanced payment (U0003 to U0005) will also no longer be payable.

• Home-Based Specimen Collection “Nominal Specimen Collection Fee” for Laboratories.

  • During the PHE: CMS has authorized a “nominal specimen collection fee” that can be made to laboratories that send trained technicians to a beneficiary’s home to collect COVID-19 related test samples from homebound Medicare beneficiaries that are not hospital inpatients. The fee has been intended to cover both specimen collection and travel and has generally been $24.46 (or $25.46 for beneficiaries in a non-covered stay in a SNF or whose samples were collected by a laboratory acting on behalf of a home health agency) and have been billed under HCPCS code G2023 (or G2024).[51]

  • When the PHE expires: Nominal specimen collection fees for laboratory collection of patient specimens at home will terminate when the PHE expires.[52]

• Orders for Laboratory-Performed COVID-19 Tests.

  • During the PHE: On May 8, 2020, CMS announced that Medicare would not require an order from a physician or other applicable practitioner for COVID-19 and related tests.[53] Three months later, on August 24, 2020, CMS revised this policy to limit the amount of tests that were permitted without an order.[54] As updated, the emergency policy has permitted one COVID-19 diagnostic test and one of each other applicable related test without an order from a treating physician or other practitioner.[55]

  • When the PHE expires: This flexibility will terminate at the end of the PHE, and Medicare will require that all COVID-19 and related testing performed by a laboratory be ordered by a physician or non-physician practitioner.

E.     Medicare Advantage (MA) and Medicare Part D

PHE waivers and flexibilities related to MA and Part D include those related to cost-sharing for COVID-19-related vaccines and diagnostic tests, Part D enforcement discretion related to COVID-19 oral antivirals, and alterations to the Part D maximum day supply. Below we summarize how the expiration of the PHE will affect a number of these policies.

• MA Cost-Sharing for COVID-19 Related Vaccines and Diagnostic Tests.

  • During the PHE: For enrolled beneficiaries, MA plans have been requiring to pay for COVID-19 vaccines and their administrations (including approved booster doses) without cost-sharing in network since January 1, 2020.[56] They also have been prohibited from charging cost-sharing for COVID-19 clinical laboratory tests, the administration of such tests, and certain other specified COVID-19 testing-related services.[57]

  • When the PHE expires: Even after the PHE expires, MA plans will be required to continue to offer COVID-19 vaccines (and their administration) without cost-sharing.[58] However, after the PHE ends, MA plans will no longer be required to waive cost-sharing for COVID-19 related diagnostic tests (or the administration of such tests).[59]

• Part D Enforcement Discretion with Respect to Certain U.S. Government Procured EUA Oral Antiviral Drugs for Treatment of COVID-19.

  • During the PHE: For EUA oral antivirals for the treatment of mild-to-moderate COVID-19 that were procured by the U.S. government and provided to pharmacies at no cost, CMS has exercised enforcement discretion to permit Part D plan (PDP) sponsors to pay pharmacy claims for dispensing fees without enrollee cost-sharing and to report prescription drug events (PDEs) for the associated dispensing fee claims.[60]

  • When the PHE expires: CMS has said that it will continue to permit this flexibility following the end of the COVID-19 PHE while U.S. Government procured products remain available. COVID-19 oral antivirals not procured by the U.S. Government must also continue to be covered (either on-formulary or through a formulary exception process) if they meet the statutory requirements for Part D coverage, including EUA products.[61]

• Part D Maximum Day Supply and “Refill-to-Soon” Edits.

  • During the PHE: PDP sponsors have generally been required to permit enrollees to obtain the total supply prescribed for a covered Part D drug (up to a 90-day supply) in one fill or refill when requested by the enrollee.[62] Part D plan sponsors have also been required to relax their “refill-too-soon” safety edits (though they have been given operational discretion in how to do so).[63]

When the PHE expires: The maximum day supply and refill-to-soon edit requirements on PDP sponsors will lapse at the end of the PHE.[64]

F.     Medicaid/Children's Health Insurance Program (CHIP)

A number of policy actions were taken during the PHE to expand access under Medicaid and CHIP. Among other things, legislative action was taken during the emergency period to promote stability of health care coverage and to supports states through increased federal funding. Congress also acted to ensure widespread access to COVID-19 testing, treatment, and vaccination for Medicaid and CHIP beneficiaries. The end of the PHE has significant implications for these policies, and we summarize below how the expiration of the PHE will affect a number of key Medicaid and CHIP emergency policies.

• Federal Medical Assistance Percentage (FAMP) Adjustments.

  • During the PHE: The Families First Coronavirus Response Act (FFCRA), as amended by the CARES Act, provided a 6.2 percent point increase in FMAP rates to states meeting certain requirements (e.g., continuous enrollment of Medicaid beneficiaries, maintenance of effort requirements, certain premium requirements).[65]

  • When the PHE expires: Withdrawal of enhanced FMAP will occur on a phased-in basis and has already begun prior to the end of the PHE (with the phase-in starting as of January 1, 2023). The enhanced FMAP will continue to be reduced in quarterly increments throughout 2023 (Quarter 1: 6.2% enhanced FMAP, Quarter 2: 5.0% enhanced FMAP, Quarter 3: 2.5% enhanced FMAP, Quarter 4: 1.5% enhanced FMAP).[66] Enhanced FMAP will be entirely eliminated by December 31, 2023. Continuous enrollment will also no longer be required as a condition of eligibility starting March 31, 2023.[67]

• COVID-19 Testing, Vaccines, and Treatments.

  • During the PHE: State Medicaid and CHIP plans have been required to cover COVID-19 vaccines (including boosters) and treatments and the administration thereof without cost-sharing for all Medicaid enrollees.[68] State Medicaid and CHIP plans have also been required to cover FDA-authorized COVID-19 tests for diagnostic and screening purposes without cost-sharing for full-benefit enrollees.[69]

  • When the PHE expires: Coverage of COVID-19 vaccines, treatment, and coronavirus testing will continue without cost-sharing through September 30, 2024.[70] Thereafter, policies for vaccines, treatment, and testing could vary by state.

G.     Fraud Waste and Abuse (FWA) Laws

During the PHE, CMS and the OIG have granted waivers and exercised enforcement discretion with respect to certain arrangements that implicate the health care fraud, waste, and abuse laws. The expiration of the PHE will have significant implications for these emergency policies.

• FWA Waivers and Enforcement Discretion.

  • During the PHE: Under the Physician Self-Referral (Stark) law, CMS granted blanket waivers related to 18 types of financial and referral arrangements where certain conditions were satisfied and arrangements related solely to the PHE.[71] In addition, OIG issued a Policy Statement that it would exercise enforcement discretion not to impose administrative sanctions under the Anti-Kickback Statute (AKS) with respect to remuneration described in 11 of CMS’s 18 Stark Law blanket waivers.[72]

  • When the PHE expires: CMS’s Stark Law waivers will terminate with the expiration of the PHE.[73] Although OIG has not (to date) stated that it will cease exercising enforcement discretion with respect to the AKS automatically at the end of the PHE, OIG is likely to turn a more skeptical eye toward questionable arrangements related to COVID-19 once the emergency period officially ends. OIG has also made clear that its policy statement announcing enforcement discretion “may not” be relied on “for conduct that occurs after the expiration of” CMS’s Stark Law waivers.[74]

H.     FDA COVID-19 Related Emergency Use Authorizations

• During the PHE: FDA has authorized use of certain COVID-19-related tests, treatments, and vaccines under EUAs.[75]

• When the PHE expires: Because EUAs are promulgated under Section 564 of the Federal Food, Drug, and Cosmetic Act (and not under the Section 219 PHE declaration), they can persist beyond the expiration of the PHE—i.e., they will continue until the Secretary terminates the EUA. Therefore, the end of the PHE in May 2023 will not directly impact FDA’s ability to use EUAs to authorize tests, treatments, and vaccines for COVID-19. The Secretary has not yet declared when the COVID-19 related EUAs will terminate.

*             *             *

There are likely to be significant questions resulting from the expiration of the PHE. We emphasize that the differing end-dates for various emergency policies could also result in operational challenges and confusion for providers, physicians, plans, and other stakeholders. Many of the emergency policies were intended to be inter-connected with other emergency policies. However, these interconnected emergency policies may now be expiring at different times.

For example, as noted, Congress has extended the emergency waiver of Medicare telehealth geographic restrictions until December 31, 2024. However, other Medicare emergency policies related to the use of telemedicine technology have not been extended and may terminate immediately when the PHE ends (e.g., telemedicine-based prescribing of certain controlled substances will once again need to be preceded by an in-person medical evaluation). Stakeholders will need to be cautious in updating their processes and systems, and ensure that they fully understand the scope of the emergency policies that are continuing beyond the end of the PHE versus those that will expire immediately when the PHE ends.

We will continue to monitor the health care regulatory policy changes that will follow from the expiration of the PHE. Please contact any of the attorneys listed as an author to this alert with any questions or concerns related to the expiration of the COVID-19 PHE and its implications for waivers and flexibilities implemented during the emergency period.

Authored by James Huang, Lindsey Johnson, Jessica Robinson Hanna, Ashley Grey, Katie Kramer, Rianna Modi, and Mike Dohmann