On January 31, 2020, Alex Azar, the US Secretary of Health and Human Services (HHS), signed a determination of a national Public Health Emergency (PHE) arising from the COVID-19 pandemic. According to the Administration for Strategic Preparedness and Response:

Under section 319 of the Public Health Service (PHS) Act, the Secretary of the Department of Health and Human Services can declare a Public Health Emergency (PHE) if he determines, after consulting with such public health officials as may be necessary, that 1) a disease or disorder presents a PHE, or 2) a PHE, including significant outbreaks of infectious diseases or bioterrorist attacks, otherwise exists.  A PHE declaration allows the Secretary to take certain actions in response to the PHE.  In addition, a public health emergency can be a necessary step in authorizing the Secretary to take a variety of discretionary actions to respond to the PHE under the statutes HHS administers.

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The Administration announced on January 30, 2023 that the intent of the administration is to, “extend the emergency declarations to May 11.”

Valhalla Business Advisors monitors macro trends which may influence the business context of clients, such as the end of the Public Health Emergency. By monitoring trends, Valhalla positions itself to offer impactful advice to clients, whether they disproportionately employ variable-hour staff (e.g. hotel operators and personal service firms) or derive income from multiple forms of health care payors (e.g. hospitals and physician practices).

What impact did the phe have and what are the consequences of it ending?

A very good summary of the impacts created by the PHE are listed at this website from KFF. Included in the items identified are:

• Coverage, costs, and payment for COVID-19 testing, treatments, and vaccines
• Medicaid coverage and federal match rates
• Telehealth
• Other Medicaid and CHIP flexibilities
• Other Medicare payment and coverage flexibilities
• Other private insurance coverage flexibilities
• Access to medical countermeasures (vaccines, tests, and treatments) through FDA emergency use authorization (EUA)
• Liability immunity to administer medical countermeasures

Among the most impactful of items on this list to clients of Valhalla are impacts to Medicaid and CHIP. Reliance on these programs during the PHE expanded dramatically; A recent survey by KFF offered insights that, “among the 20 responding states able to report, that states expect on average about 13% of Medicaid enrollees to be disenrolled following the end of the continuous enrollment requirement (with estimates ranging from 8% to over 30%).“

What are the implications of these changes?

Of course, these changes will impact various stakeholders in different ways. For example:

• Plan Sponsors – To the extent that Plan Sponsors have seen high rates of qualified waivers as a result of employees’ and dependents’ enrollment in Medicaid, as these members seek new coverage within traditional commercial contexts, the impacts to cost and risk may be consequential.
• Healthcare Providers – Certainly, the extent to which enrollment in Medicaid in certain communities transitions to either commercial coverage or uninsured status may impact provider payor-mix and financial results. Trends in local communities should be monitored carefully.
• State and Local Government – There is much to say about the implications of this unwind to state and local governments. KFF offered some nice insights in this article.
• Employers, more broadly – To the extent that employers, irrespective of their own employee benefit strategies, employ people who have come to rely upon Medicaid and CHIP for their family’s financial security, the disruption in these programs may serve as a catalyst to re-evaluate contexts; Will employees consider new job opportunities? Possible relocation? Career pivots and/or retraining?

Of course, there are additional program changes also affecting lower income populations worthy of monitoring. For example, there is a reduction in SNAP benefits (f.k.a. “food stamps”) beginning in March 2023 for all but eighteen states (who had previously returned to pre-pandemic levels.)

Resources identified by valhalla business advisors

These are some resources that we have identified as useful relative to the ending of the PHE:

• KFF article: “What Happens When COVID-19 Emergency Declarations End? Implications for Coverage, Costs, and Access”
• CMS publication: “What do I need to know? CMS Waivers, Flexibilities, and the Transition Forward from the COVID-19 Public Health Emergency”
• Food and Nutrition Service: “SNAP – Expiration of Program Flexibilities for the COVID-19 Public Health Emergency”
• CMS/Medicaid: “Top 10 Fundamental Actions to Prepare for Unwinding and Resources to Support State Efforts”
• Georgetown University Health Policy Institute: “50-State Unwinding Tracker”

If any of these items provoke questions or reactions, reach out to discuss with Valhalla Business Advisors! We are interested in discussing areas where we can best support you and your business!