Heroes Act Highlights for Medicaid and Home and Community-Based Services

Legislation | May 15, 2020 | by Brendan Flinn

House majority leadership on May 12 released the ‘‘Health and Economic Recovery Omnibus Emergency Solutions Act’’, later retitled simply the Heroes Act, as part of the continuing legislative effort to address the coronavirus pandemic. The Act contains new funding for the Medicaid program and for home and community-based services (HCBS), some of which include elements of proposals from LeadingAge, and addresses other healthcare-specific issues.

House majority leadership on May 12 released the ‘‘Health and Economic Recovery Omnibus Emergency Solutions Act’’, later retitled simply the Heroes Act, as part of the continuing legislative effort to address the coronavirus pandemic. The Act contains new funding for the Medicaid program and for home and community-based services (HCBS), some of which include elements of proposals from LeadingAge, and addresses other healthcare-specific issues.

FMAP Enhancement

The Heroes Act would strengthen the Medicaid program by further enhancing the federal share of Medicaid spending. Increasing the federal matching rate for Medicaid is a key tool the federal government can use to support Medicaid and state budgets and has been done in previous economic downturns, including the Great Recession.

The Families First legislation in March increased the federal Medicaid match for every state by 6.2 percentage points for the duration of the COVID-19 pandemic. The Heroes Act would increase the share further, from July 2020 through June 2021, by increasing the federal spending match a further 7.8 points- providing states a federal match a total of 14 percentage points higher than their typical share. A state with a 50% match before COVID-19, for example, would receive a match of 56.2% in May 2020 through Families First, and then in July receive a match of 64% through Families First and, if enacted, the Heroes Act.

HCBS FMAP Enhancement

In addition to the general federal matching increase, the Heroes Act also provides a targeted, ten percentage point increase in the federal share of Medicaid home and community-based services (HCBS). The increase would apply to waiver services, like adult day and assisted living, as well as home health, personal care and PACE. Increases like these go to states, not providers, so the increase does not automatically mean providers will see higher rates. The HCBS share increase, however, requires states to use the extra money for Medicaid HCBS specifically, meaning more resources would be available for these supports if the Heroes Act becomes law.

MFAR Moratorium

The Heroes Act also would prevent the federal government from finalizing the proposed Medicaid Fiscal Accountability Regulation (MFAR) through the end of the COVID-19 national emergency. The proposed MFAR could have damaging effects on state budgets, as well as for aging services providers, so a block on this rule would help protect states and their Medicaid programs.

Older Americans Act Dollars

Building on the CARES Act, which provided close one billion dollars to the Older Americans Act (OAA) programs, the Heroes Act would send state agencies an additional $100 million for OAA. As part of this fund, $20 million each would be allocated for supportive services (including HCBS), nutrition programs and family caregiver support programs.

Other Items of Interest

In addition the Medicaid and OAA provisions, the Heroes Act includes general provisions that may be of interest to HCBS providers.

  • The Provider Relief Fund would get a make-over, specifically mandating that funds be distributed by a grant program, setting up the way the program is to be implemented. LeadingAge is reviewing carefully to see how this will affect members.
  • A variety of commissions and task forces are created to address the federal response to testing, equipment distribution, a cohesive and coherent plan for distributing funds authorized for COVID-19 response.
  • A “HEROES Fund” is created to provide premium support for essential workers, which would include home health and other in-person workers. LeadingAge has strongly advocated for increased funds for frontline staff in all our communities and home-based settings.