Healthcare Sector Winners and Losers in the 2024 Government Funding Bill

Telehealth Extension:
The funding bill extends telehealth and hospital-at-home programs through March 31, 2025, and certain Medicare telehealth flexibilities until December 31, 202624.

Medicare Payments:
The bill includes a temporary 2.5% increase in the Medicare physician fee schedule for 2025 to offset a 2.83% pay cut finalized by CMS4.

Medicaid DSH:
The package delays Medicaid Disproportionate Share Hospital (DSH) pay cuts until January 1, 2027, and corrects a policy affecting uncompensated care limits for dually eligible patients4.

Rural Hospitals:
The bill extends the Medicare-dependent Hospitals and Low-volume Adjustment programs, providing financial assistance to smaller hospitals with a high percentage of Medicare patients24.

Pharmacy Benefit Managers (PBMs):
The legislation prohibits "spread pricing" in Medicaid and includes reforms such as full rebate pass-through to plan sponsors in the commercial market and delinking drug prices from PBM compensation in Medicare Part D4.

Losers:
Physicians and their trade groups are disappointed that the bill does not block planned cuts in Medicare payments to doctors, which are slated to take effect in 202524.

Omissions:
The package does not include legislation to reform prior authorization, particularly in Medicare Advantage, which was a significant concern for hospitals and medical groups4.

Sources:

2. https://www.chiefhealthcareexecutive.com/view/congressional-spending-plan-what-s-in-it-for-healthcare-and-what-isn-t

4. https://www.beckershospitalreview.com/finance/congress-healthcare-package-key-wins-for-hospitals-telehealth-and-physician-pay.html