Analysis of Consolidated Appropriations Act’s (HR-133) GME Impact
Author: Zana Hekmat
On December 27, 2020, Congress passed the Consolidated Appropriations Act, 2021 (HR 133) which provides legislation that is pertinent to academic medicine. In Germane Solutions’ core commitment to our clients and healthcare community, we are pleased to provide our guidance and understanding into these provisions as they currently stand.
This article provides summaries in our interpretations of the three most important sections affecting Graduate Medical Education (GME).
Section 126: Distribution of additional residency positions
- This provision distributes 1,000 Medicare-supported GME positions towards a provider’s FTE cap, with a maximum of 200 positions to be distributed in each of the next 5 years.
PROCESS AND TIMELINE FOR DISTRIBUTION
- The first application cycle, anticipated in the fiscal year 2023, will determine disbursement. CMS will announce the awardees of each distribution round by January 31st. The approved positions will be effective July 1st. We believe this means that the first awardees will be announced January 31, 2023 with the distributed slots to be effective July 1, 2023, which is the academic year 2024. Lastly, the application process will be under the direction of the Department of Health & Human Services (DHHS).
ELIGIBILITY AND LIMITATIONS
- Applicable to both urban and rural hospitals, hospitals must apply for these positions. It is important to note that no hospital can receive more than 25 additional positions.
CONSIDERATIONS IN DISTRIBUTION
- One key consideration in approval of a hospital’s application for additional residency positions will be in the “demonstrated likelihood of the hospital filling the positions” within the 5 years. Furthermore, the hospital must increase the total number of residents trained by the number of approved positions.
- Of the available positions, no less than 10% of the positions will be distributed to each group of hospitals that fit into the following 4 categories. Therefore, of the 200 positions each year, 40% of those positions must be distributed to hospitals in the categories below:
- Rural hospitals – this includes hospitals located in a rural area or hospitals that are “treated as being located in a rural area” meaning that the hospital has elected Rural Designation.
- Hospitals currently training over their FTE cap.
- Hospitals in states with new Medical Schools accredited or received Pre-Accreditation on or after 1/1/2000.
- Hospitals that serve areas designated as health professional shortage areas.
- The following stipulations exist as it relates to funding for Direct Graduate Medical Education (DGME) payments and Indirect Medical Education (IME) payments:
- DGME – the hospital primary and non-primary PRA amounts will be used, as opposed to the National PRA as done for 422 awards.
- IME – the regular IME formula will be utilized, not the formula used for 422 awards.
Section 127: Promoting Rural Hospital GME Funding Opportunity
- Rural and urban hospital opportunities for collaboration have been strengthened by the removal of the separate accreditation requirement for Rural Training Track (RTT) programs; ultimately allowing both rural and urban hospitals to receive federal funding for training programs aimed at increasing the number of physicians in rural areas.
- To be considered, the program must maintain separate accreditation through September 30, 2022, and, following October 1, 2022, must maintain 50% or more of the program in a rural area.
Section 131: Medicare GME Treatment of Hospitals Establishing New Medical Residency Training Programs After Hosting Medical Resident Rotators for Short Durations
- Section (a) provides relief for hospitals that have very low FTE per resident amounts (PRA), either from a cost reporting period beginning before 10/1/1997 where the hospital trained less than 1.0 FTE or from a cost reporting period beginning on or after 10/1/1997 that trained no more than a 3.0 FTEs.
- Section (b) provides relief for hospitals that have a very low FTE cap, either from the 1996 FTE cap period with an FTE cap of less than 1.0 FTE or from a cost reporting period on or after 10/1/1997 with an FTE cap of no more than 3.0 FTEs.
To qualify for a new PRA, the hospital has not entered into a GME affiliation agreement after the date of enactment, must plan to develop “new approved medical residency training program or programs” and:
- train at least 1.0 FTE after the date of enactment where the current PRA was developed from a cost reporting period beginning before 10/1/1997;
- train at least 3.0 FTE after the date of enactment where the current PRA was developed from a cost reporting period beginning on or after 10/1/1997;
To qualify for the adjustment to the FTE cap, the hospital must plan to develop “new approved medical residency training program or programs” and:
- train at least 1.0 FTE resident in such new GME programs where the current FTE cap was developed from a cost reporting period beginning before 10/1/1997;
- train at least 3.0 FTE residents in such new GME programs where the current FTE cap was developed from a cost reporting period beginning on or after 10/1/1997.
- The adjustment to the FTE cap limitation shall be done consistent with the new program rules in section 413.79(e).
- Qualifying for either of these provisions is difficult and requires detailed analysis. Germane is ready to assist that assessment.
To gauge if your hospital is eligible for any provisions included in the Consolidated Appropriations Act, 2021 (HR 133) as it relates to GME, or how your organization can satisfy these provisions, please contact the Germane team for a detailed review. Germane Solutions can help you understand the complex regulatory and reimbursement issues involved with GME and will continue to provide in-depth analysis of GME-related legislation via our monthly News Alerts