Legislators and Hospitals Concerned Mandate Bills Could Impact Medicare

Does a COVID-19 vaccine mandate prohibition cut off Medicare funding for hospitals and health care providers? That question was one that was central to the debate during the Wyoming Legislature’s special session and may return during the 2022 Legislative Session in February.

Medicare is the federal health insurance program for those 65-and-over, as well as citizens with certain other medical issues such as disabilities or end-stage renal disease. Because that healthcare is paid for through the federal government, and delivered by hospitals, doctors, and nursing homes, those facilities are subject to a federal rule requiring workers in those facilities be vaccinated. The concern among some is that facilities that refuse to require their workers to be vaccinated, can lose the ability to treat patients who are on Medicaid and Medicare. The concern that businesses and hospitals could be in compliance with federal law, but face fines if state laws were passed prohibiting vaccine mandates, led to much uncertainty among the business community, and the legislature.

Among those concerned with whether a vaccine mandate prohibition could impact a facility’s opportunity to serve Medicare patients is State Senator David Kinskey (R-Sheridan/Johnson).

“The world has turned upside down,” Kinskey says on the floor of the Senate during debate during the special session. “When a conservative legislature, in a conservative state, opposes a liberal president’s wrong-headed mandate by proposing a well-intentioned, but equally over-reaching mandate of its own, that does zero to stop that president’s mandates, and puts business in the crossfire, jobs at risk and puts conservative against conservatives.”

The Rule Requiring COVID Vaccines for Providers

The federal rule itself is known as the “Centers for Medicare (CMS) and Medicaid Omnibus COVID-19 Healthcare Staff Vaccination Interim Final Rule” and went into effect on Nov. 5 of 2021. The regulations inside of this rule are set to go into effect on Jan. 4, covering around 76,000 healthcare providers and over 17 million healthcare workers, according to CMS.

According to CMS, facilities covered by this regulation must establish a policy ensuring all eligible staff have received the first dose of a two-dose COVID-19 vaccine or a one-dose COVID-19 vaccine prior to providing any care, treatment, or other services by December 6, 2021. All eligible staff must have received the necessary shots to be fully vaccinated – either two doses of Pfizer or Moderna or one dose of Johnson & Johnson – by January 4, 2022.

On Nov. 10, there were 10 states that sued President Joe Biden and his administration challenging the CMS rule. Wyoming was one of those 10 states. Those states claim CMS didn’t follow required procedures for handing down the vaccine requirements and didn’t have good rationale for doing so, either.

On Nov. 29, a District Court judge in the Eastern District of Missouri issued a preliminary injunction that halts implementation and enforcement of that rule. According to a statement from Governor Gordon’s office, the court wrote, “Because it is evident CMS significantly understates the burden that its mandate would impose on the ability of healthcare facilities to provide proper care, and thus, save lives, the public has an interest in maintaining the ‘status quo’ while the merits of the case are determined,”

“Wyoming continues to face a significant shortage of healthcare workers and this federal mandate will only exacerbate our healthcare staffing issues,” Wyoming Governor Mark Gordon says in a statement. “This administration needs to understand that overreaching policies that force employees to choose between vaccination and termination negatively impact Wyoming communities, rural healthcare, and residents of skilled nursing facilities.”

The Impact on Medicare

The question of what happens to facilities that don’t comply weighs heavily on the minds of legislators and administrators of hospitals and nursing homes. For their part, CMS released a list of frequently asked questions around Omnibus Staff Vaccination Requirements. In that document, CMS addressed the issue of compliance with the requirement.

“Medicare and Medicaid-certified facilities are expected to comply with all regulatory requirements, and CMS has a variety of established enforcement remedies,” says the document. “For nursing homes, home health agencies, and hospice (beginning in 2022), this includes civil monetary penalties, denial of payment, and even termination from the Medicare and Medicaid program as a final measure. The remedy for non-compliance among hospitals and certain other acute and continuing care providers is termination; however, CMS’s goal is to bring health care facilities into compliance. Termination would generally occur only after providing a facility with an opportunity to make corrections and come into compliance.”

The guidance from CMS also points out that under the Supremacy Clause of the U.S. Constitution, this regulation preempts any state law to the contrary.

What does this mean for Facilities?

Josh Hannes of the Wyoming Hospital Association says there is little wiggle room in the guidance the federal government has given on the federal mandate for healthcare workers to be vaccinated and its impacts on Medicare services. Hannes says he believes non-compliance with the rule could lead to the inability for a facility to admit Medicare patients.

“CMS has been very very clear that this rule governs over any state law to the contrary,” says Hannes. “It would be part of the state license and survey office in the states to audit facilities making sure all staff are vaccinated, or have applied for and received one of the exemptions. The ultimate penalty is removal from the Medicare program.

The Wyoming Hospital Association says it believes hospitals and nursing homes in Wyoming should be allowed to develop policies and procedures that make for the safest settings possible.

In Wyoming, Hannes estimates, roughly 50-60% of all patients who walk through the door of the state’s hospitals are paid for by Medicare or Medicaid. If facilities choose to follow a state law that outlawed vaccine mandates instead of following the federal rule requiring vaccine mandates of its workers, Hannes points out if facilities could not be reimbursed by Medicare, they would likely close rapidly.

“It’s not right that we would be criminals in our own state by doing what we have to do to survive,” Hannes says. “If the goal from the legislators was we need to draw a line in the sand, this doesn’t do that. It doesn’t stop any rule from going into place. It just puts hospitals and nursing homes into a position where they can be charged with a crime.”

Kinskey told the Sheridan County Republican Women that Sheridan Memorial Hospital is 64% Medicare, Medicaid, and VA patients. He says he thinks healthcare should be a personal choice, but doesn’t see a way for the Sheridan hospital to survive without Medicare and Medicaid funding. That would impact patients as well as 750 employees at the hospital.