Health Care Policies Included in Year-End Funding Bill, Doc Fix Dropped

Stopping the physician Medicare payment cut failed to survive last-minute government funding negotiations while several other health care policies were still included.

A massive, 1,500-page bill, which included the doc fix, had originally been negotiated — but that bill was scrapped for a much smaller, 120-page bill. The doc fix did not survive, nor did pharmacy benefit manager reforms. However, community health center funding, hospital programs, and telehealth policies did survive.

Congress passed and the president signed the much smaller bill into law on December 21, temporarily averting a government shutdown. The American Relief Act of 2025 (H.R. 10545) extends government funding through March 14, 2025. It also includes a one-year extension of the Farm Bill, $100 billion in funds to FEMA for disaster recovery, and a handful of health care extenders.

Physicians

The earlier package partially mitigated 2.5% of the 2.8% cut physicians are set to see in 2025 in their Medicare reimbursements. This fix failed to be signed into law, leaving physicians facing a 2.8% cut starting on January 1, 2025. The enacted law does include an extension of the work geographic index until April 1, 2025, and various telehealth policies were extended through March 31, 2025.

Tax Policy Update 
If you’re wondering about tax policies in the Tax Cuts and Jobs Act, 
see CLA’s article for insights on how Congress could address these policies
next year. These policies are not included in the end-of-year funding package.

Hospitals

The low volume adjustment and Medicare dependent designation are extended through March 31, 2025. The hospital-at-home model is extended through March 31, 2025. Telehealth policies are extended through March 31, 2025. Medicaid disproportionate share hospital cuts are stopped through March 31, 2025, and Medicare ground ambulance add-on payments are extended through that time period.

KEY POINTS:

•  Massive end-of-year funding package scrapped and replaced with much smaller package       signed into law
•  Physicians pay fix failed to be included in final law
•  Various health care policies are extended 90 days

Senior living and care

The package does not include repeal or delay of the nursing home staffing mandate; however, we expect this to be addressed in the new Congress. The ability to use telehealth to conduct face-to-face encounters prior to recertification of eligibility for hospice care is extended through March 31, 2025.

Community health centers

CHC funding is extended through March 31, 2025. There is also an extension of the national health service corps and the teaching health centers that operate graduate medical education programs through March 31, 2025. Extending telehealth for federally qualified health centers runs through March 31, 2025.

Telehealth policies

The geographic requirements and originating site changes have been extended through March 31, 2025. The expanded list of practitioners who may furnish telehealth services was also extended, as were various telehealth policies currently in place for FQHCs and rural health clinics. Additionally, in-person requirements for mental health services furnished through telehealth have also been delayed through March 31, 2025. The ability to use telehealth to conduct face-to-face encounters prior to recertification of eligibility for hospice care is extended through March 31, 2025.

How CLA can help with impacts of legislation

This smaller government funding package enacted in late December means the incoming Congress will need to act again in early 2025, as government funding only runs through March 14, 2025. In addition, the health care extensions only run through March 31, 2025. Add onto that the lack of a physician fix and the result will be (as expected) a very busy new year.

If your organization needs help deciphering these changes and their impacts on you and your business, CLA’s health care and life science advisory team can help. Reach out at any time.