The CARES Act Provider Relief Fund is designed to support American families, workers, and healthcare providers in the battle against the COVID-19 outbreak. The U.S. Department of Health and Human Services (HHS) is distributing $175 billion in grants to hospitals and healthcare providers on the front lines of the coronavirus response. Providers that have not yet received funding can still apply before August 28.
Details of Provider Relief Funding
The intent of the HHS grant funding is to support healthcare-related expenses or lost revenue attributable to the coronavirus and ensure all Americans have access to the care they need. The initial $30 billion was allocated based on the facilities’ and providers’ share of 2019 Medicare fee-for-service (FFS) reimbursements. These were payments, not loans, to healthcare providers and are not required to be repaid.
Timeline of Provider Relief Fund Grant Distribution
- On April 10, 2020, HHS began distributing the initial $30 billion in relief funding to eligible providers throughout the American healthcare system.
- On April 24, a portion of providers were automatically sent an additional advance payment based off the revenue data they submitted in CMS cost reports. Providers without adequate cost report data on file needed to submit their revenue information for additional General Distribution funds.
- On June 9, Phase 2 of General Distribution began with $15 billion sent to eligible Medicaid, CHIP and dental providers and $10 billion to safety net hospitals.
- On June 10, HHS launched an enhanced Provider Relief Fund Payment Portal that allowed eligible Medicaid and CHIP providers to report their annual patient revenue, which will be used as a factor in determining their Provider Relief Fund payment. The payment to each provider will be at least 2% of reported gross revenue from patient care; the final amount each provider receives will be determined after the data is submitted, including information about the number of Medicaid patients providers serve.
- On July 10, the HHS, through the Health Resources and Services Administration (HRSA), announced approximately $3 billion in funding to hospitals serving a large percentage of vulnerable populations on thin margins and approximately $1 billion to specialty rural hospitals, urban hospitals with certain rural Medicare designations, and hospitals in small metropolitan areas. HHS is also opening the provider portal to allow dentists to apply for relief.
- On August 7, the HHS announced $5 billion in allocations of CARES Act Provider Relief Fund for nursing homes. HRSA expects the initial $2.5 billion nursing home distribution to occur in mid-August. This will be followed by additional performance-based distributions throughout the fall.
View the full CARES Act Provider Relief Fund Distribution Timeline.
Terms and Conditions of Provider Relief Funding
Within 30 days of receiving the payment, providers are required to sign an attestation confirming receipt of the funds and agreeing to the terms and conditions of payment via an online portal. Providers that do not accept the Terms and Conditions after 90 days of receipt will be deemed to have accepted the Terms and Conditions.
All recipients will be required to submit sufficient documents 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.
A condition to receiving these funds is providers must agree not to seek collection of out-of-pocket payments from a presumptive or actual COVID-19 patient that are greater than what the patient would have otherwise been required to pay if the care had been provided by an in-network provider.
Provider Relief Funding and PPP Loans
The monies received from the HHS funding cannot be used for payments to reimburse expenses or losses that have been reimbursed from other sources or that other sources are obligated to reimburse. Additional reporting is required for recipients receiving more than $150,000 in total funding.
Applying for Provider Relief Funding
The original funding did not require any application or request for the monies, as it was based off prior claims data. To be eligible for a Provider Relief Fund grant going forward, health care providers must not have received payments from the $50 billion Provider Relief Fund General Distribution and either have directly billed their state Medicaid/CHIP programs or Medicaid managed care plans for healthcare-related services between January 1, 2018, to May 31, 2020. Close to one million health care providers may be eligible for this funding.
Applications are currently open for the General Distribution (Phase 2) to Medicaid, Medicaid managed care, Children’s Health Insurance Program (CHIP) and dental providers. Providers that have not yet received funding and would like to apply can download the Provider Distribution Instructions and apply in the Provider Relief Fund Application and Attestation Portal. Applications must be submitted by Aug. 28, 2020.
Our advisors are closely following COVID-19 relief efforts and will continue to publish insights to keep you informed about potential impacts and benefits. Visit our COVID-19 Resource Center for more insights or contact Anders below to discuss how we can help you along the Provider Relief Funding process.
