Secretary Azar Extends Public Health Emergency Medicaid Protections for Beneficiaries and States

[Editor’s Note: For more up-to-date developments on the status of the public health emergency read CCF’s latest blog post on this topic.]

On Friday HHS Secretary Azar renewed his declaration of a public health emergency (PHE) due to the coronavirus pandemic.  The renewal is effective October 23, when the previous 90-day renewal would have expired, and extends the PHE through January 20, 2021, almost a year to the day since the Secretary first declared a public health emergency.

In a time of many uncertainties, the Secretary’s declaration eliminates a critical one.  Failure to renew the PHE would have harmed  Medicaid beneficiaries and states, because a number of COVID-19 response policies are tied directly to the emergency period covered by the PHE declaration.  (Since the declaration is not a guidance document, it has the force and effect of law).  Among the current policies extended by the renewal:

  • The 6.2 percentage point increase in the federal Medicaid matching rate (FMAP). The Families First Coronavirus Response Act provided a 6.2 percentage point increase in the FMAP through the last day of the calendar quarter in which the PHE period ends. (This translates into a 4.34 percentage point increase in the federal matching rate for CHIP).  As my colleague Edwin Park has explained, this increase is not sufficient to the task of helping states fund their share of Medicaid costs during the current economic downturn.  It has, nonetheless, provided billions in badly needed fiscal relief to state budgets  If, as seems highly likely, the PHE remains in effect until (at least) January 21, 2021 , the 6.2 percentage point increase will remain available to states through the quarter ending  March 31, 2021, or three quarters of the way through the current fiscal years of most states
  • The continuous coverage (MOE) requirement. Under Families First, states accepting the 6.2 percentage point FMAP increase may not terminate the Medicaid eligibility of any individual enrolled in Medicaid as of March 18 or subsequently.  As my colleague Tricia Brooks predicted, this maintenance of effort (MOE) requirement has proven crucial to protecting beneficiaries from the loss of Medicaid coverage due to red tape in the midst of the pandemic and the economic downturn.  Like the FMAP bump, the MOE is tied to the PHE period, but unlike the bump, it ends on the last day of the month in which the PHE period ends.  If the Secretary had allowed the PHE declaration to expire on October 23, the MOE protections would have ended on October 31.  With the renewal, the protections remain in place until at least January 31, 2021.
  • Temporary Administrative Authorities. CMS has used three temporary authorities to provide states with flexibility in administering their Medicaid programs during the pandemic:  section 1135 waivers, Disaster Relief SPAs, and COVID-19 section 1115 waivers.  Each of these is tied to the PHE period (the section 1135 waivers also depend on the President’s declaration of a national emergency).  States have relied extensively on these various authorities to, among many other things, expand the use of telehealth and increase payment rates to providers.  To date, per both the CCF and Kaiser Family Foundation Trackers, CMS has approved one or more section 1135 waivers for all 50 states and DC,  Disaster Relief SPAs for 49 states and DC, and COVID-19 section 1115 waivers for 7 states.   The Secretary’s extension of the PHE period extends these temporary authorities through at least January 31, 2021.

As this blog is written, negotiations over another COVID relief package continue.   If they result in the enactment of new legislation, the statutory and regulatory landscape described above may change.  But for now, the Secretary has eliminated one crucial uncertainty for states and millions of Medicaid beneficiaries.  That is much to his credit.  For bonus points, he should use his section 1115 waiver authority to promote health equity.

Andy Schneider is a Research Professor at the Georgetown University McCourt School of Public Policy.