Published May 8, 2020

Latest Updates — $100 Billion COVID-19 Provider Relief Fund

Through a series of press releases, the Department of Health and Human Services (HHS) has detailed its allocation of the $100 Billion Provider Relief Fund created by the CARES Act. This includes $10 billion for rural providers; $12 billion for hospitals with more than 100 COVID-19-related admissions through April 11; and $50 billion for general distribution based on providers’ 2018 net patient revenue.

UPDATED: Deadline for Attestation

On May 7, HHS extended the deadline for healthcare providers to attest to receipt of Provider Relief Fund payments and accept the Terms and Conditions. A provider now has 45 days (rather than 30 days) from the date the provider receives a payment to attest and accept the Terms and Conditions or return the funds. For example, a provider that received payment on April 10 now has until May 24 to complete the attestation through the Provider Relief Fund Payment Attestation Portal. HHS again reminded providers that “not returning the payment within 45 days of receipt of payment will be viewed as acceptance of the Terms and Conditions.” If a provider receives more than one Provider Relief Fund payment, it must complete the attestation process for each one.

UPDATED: $10 Billion Allocation for Rural Providers

On May 1, HHS announced payments to rural prospective payment system (PPS) hospitals, critical access hospitals (CAHs), rural health clinics (RHCs), and federally qualified health centers (FQHCs) located in rural areas. The state-by-state allocation is available here. Minnesota will receive the most funding ($384.6 million), followed closely by Iowa ($383.3 million) and Kansas ($382.4 million).

Each rural PPS hospital and CAH will receive at least $1 million plus an additional payment based on operating expenses. Each RHC and rural FQHC will receive at least $100,000 plus an additional payment based on operating expenses. As with prior Provider Relief Fund payments, these monies will be distributed by direct deposit, and recipients will need to complete an online attestation. A rural provider affiliated with an urban organization will still receive funds, as HHS used providers’ physical locations in making these allocations.

On a related note, the Health Resources and Services Administration (HRSA) on April 22 awarded nearly $165 million to combat the COVID-19 pandemic in rural communities. According to HRSA’s press release, “These investments will support 1,779 small rural hospitals and provide additional funding to 14 HRSA-funded Telehealth Resource Centers to provide technical assistance on telehealth to help rural and underserved areas combat COVID-19.”

UPDATED: $12 Billion for Hospitals With 100 or More COVID-19 Admissions

Also on May 1, HHS announced the allocation of $12 billion to 395 hospitals that provided inpatient care for 100 or more COVID-19 patients through April 10, 2020. Of this amount, $2 billion will be distributed to these hospitals based on their Medicare and Medicaid disproportionate share and uncompensated care payments; the remainder will be distributed based on a fixed amount per COVID-19 inpatient admission. The state-by-state allocation is available here; the 395 hospitals represent “71 percent of COVID-19 inpatient admissions reported to HHS from nearly 6,000 hospitals around the country.”

$50 Billion General Distribution Fund

HHS is allocating $50 billion—one-half of the Provider Relief Fund—for general distribution to eligible Medicare providers based on 2018 net patient revenue. Of the $50 billion, $30 billion was released via direct deposit and checks mailed between April 10 to April 24 based on Medicare fee-for-service reimbursements in 2019.

Importantly, HHS has now clarified that providers may only use these general distribution funds for limited purposes:

…[A]ll payments may only be used to prevent, prepare for, and respond to coronavirus, and that the Payment shall reimburse the Recipient only for health care related expenses or lost revenues that are attributable to coronavirus. If a recipient does not have lost revenues or increased expenses due to COVID-19 equal to the amount received a recipient must return the funds.

HHS also warns that “[a]ll recipients will be required to submit documents sufficient to ensure that these funds were used for healthcare-related expenses or lost revenue attributable to coronavirus. There will be significant anti-fraud and auditing work done by HHS, including the work of the Office of the Inspector General.”

According to the Provider Relief Fund website, “HHS has begun distributing the remaining $20 billion of the $50 billion general distribution to Medicare providers to augment providers’ allocations so that the whole $50 billion general distribution is allocated proportionally to providers’ share of 2018 net patient revenue.”

On April 24, UnitedHealth Group, on HHS’ behalf, began making these second-round payments to those providers for which HHS had adequate cost report data. Those providers that receive these “automatic” payments will need to submit a second attestation with substantially similar (yet different) Terms and Conditions. This second time around, a provider also will need to submit its revenue information for verification. HHS also notes that a provider must accept the Terms and Conditions for first-round payments before the system will accept information related to second-round funding.

A provider that received first-round funding by 5:00 pm ET Friday, April 24, but did not receive an automatic second-round payment will need to apply for such additional funds by submitting all of the following information via the CARES Provider Relief Fund Application Portal:

(1) The provider’s “Gross Receipts or Sales” or “Program Service Revenue” as submitted on its federal income tax return. The General Distribution Portal FAQs  identify specific forms and line items from which the information should be obtained.

(2) The provider’s estimated revenue losses in March 2020 and April 2020 due to COVID-19. According to HHS, a provider “may use a reasonable method of estimating the revenue during March and April compared to the same period had COVID-19 not appeared. For example, if [a provider has] a budget prepared without taking into account the impact of COVID-19, the estimated lost revenue could be the difference between [its] budgeted revenue and actual revenue. It would also be reasonable to compare the revenues to the same period last year.”

(3) A copy of the provider’s most recently filed federal income tax return.

(4) A listing of the TINs of any of the provider’s subsidiary organizations that have received relief funds but that DO NOT file separate tax returns.

HHS explains it requires this information for the following purposes:

We are collecting the “gross receipt or sales” or “program service revenue” data to have an understanding of a provider’s usual operations. We are collecting the revenue loss information to have an understanding of COVID impact. We are collecting tax forms in order to verify the self-reported information. And we are collecting information about organizational structure and subsidiary TINs so that we do not overpay or underpay providers who file tax returns covering multiple legal entities (e.g. consolidated tax returns).

HHS further clarifies that “each entity that files a federal income tax return is required to file an application even if it is part of a provider group. However, a group of corporations that files one consolidated return will have only the tax return filer apply.”

A provider submitting an application for a slice of the remaining $20 billion in general distribution funds will have to agree to the second-round Terms and Conditions. The provider then will need to attest to the receipt of funds via the CARES Provider Relief Fund Payment Attestation Portal.

An applicant will receive an email when its application is completed, but will not receive any additional communication regarding the status of the application. While HHS does not anticipate the need to make additional inquiries of an applicant, it will use the email the applicant entered to access the Provider Portal, if needed. A provider should receive additional funds for which it qualifies within 10 business days of completing the application. HHS will not take direct inquiries from providers, and there is no appeals or dispute process an applicant can pursue if it does not receive additional funding.

Medicare Advance/Accelerated Payment Program

In a related development, the Centers for Medicare & Medicaid Services (CMS) announced on April 26 that it is suspending payments to physician practices and other Part B suppliers and re-evaluating the amount of payments available to hospitals and other Part A providers under the Medicare Advance/Accelerated Payment program. CMS is basing this action on the availability of funds through the Provider Relief Fund.

According to CMS, it has “approved over 21,000 applications totaling $59.6 billion in payments to Part A providers” and “almost 24,000 applications advancing $40.4 billion in payments” for Part B suppliers.

$400 Million Allocation for Indian Health Service Facilities 

Indian Health Service facilities will share $400 million based on their operating expenses. This amount is in addition to other appropriations made in the CARES Act to support these facilities.

UPDATED:  Allocation for Treatment of the Uninsured (presumably the balance of the $100B fund)

In addition to the $2 billion in congressional appropriations for this specific purpose, HHS announced a portion of the Provider Relief Fund will  be used to reimburse providers for COVID-related treatment of the uninsured.

HRSA is taking the lead on these payments. According to its website, providers could begin enrolling on April 27, start submitting claims on May 6, and begin receiving payment via direct deposit on May 18. Reimbursement will generally be based on current-year Medicare fee schedule rates. “On-demand” training about the billing process is available on the HRSA website.

HRSA offers the following details regarding these payments:

Reimbursement will be made for: qualifying testing for COVID-19 and treatment services with a primary COVID-19 diagnosis, including the following:

    • Specimen collection, diagnostic and antibody testing.
    • Testing-related visits, including in the following settings: office, urgent care or emergency room or via telehealth.
    • Treatment: office visit (including via telehealth), emergency room, inpatient, outpatient/observation, skilled nursing facility, long-term acute care (LTAC), acute inpatient rehab, home health, DME (e.g., oxygen, ventilator), emergency ground ambulance transportation, non-emergent patient transfers via ground ambulance, and FDA-approved drugs as they become available for COVID-19 treatment and administered as part of an inpatient stay.
    • When an FDA-approved vaccine becomes available, it will also be covered.
    • For inpatient claims, date of admittance must be on or after February 4, 2020.

Services not covered by traditional Medicare will also not be covered under this program. In addition, the following services are excluded:

    • Any treatment without a COVID-19 primary diagnosis, except for pregnancy when the COVID-19 code may be listed as secondary.
    • Hospice services.
    • Outpatient prescription drugs covered under Medicare Part D.

A recently posted Frequently Asked Questions provides additional information regarding eligibility and program mechanics.

The Paycheck Protection Program and Health Care Enhancement Act

On April 24, the President signed the latest COVID-19 relief bill, the Paycheck Protection Program and Health Care Enhancement Act. The legislation includes another $75 billion for the Provider Relief Fund, subject to the same conditions as the original $100 billion. No word yet from HHS on how it may allocate this new funding.

If you would like more information about these payments, or need further COVID-19 guidance, visit PYA’s COVID-19 hub, or contact one of our PYA executives below at (800) 270-9629.

Disclaimer: To the best of our knowledge, this information was correct at the time of publication. Given the fluid situation, and with rapidly changing new guidance issued daily, be aware that some or all of this information may no longer apply. Please visit our COVID-19 hub frequently for the latest updates, as we are working diligently to put forth the most relevant helpful guidance as it becomes available.

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