Has your medical practice or facility received one or more stimulus payments from the Provider Relief Fund? Many recipient healthcare providers are unsure of how to use or apply these payments, which are part of a $175 billion provision of the CARES Act intended to shore up healthcare providers on the front lines of the coronavirus response. In recent days, there have been many changes to the payment calculation and required provider information from HHS. Some details still remain ambiguous at the time of this writing.
RKL’s healthcare advisors are here to answer questions about the attestations, applications, payment calculations, and to help providers start tracking and prepare for reporting. Read on to learn more about the program requirements and what actions providers can start taking now.
Payment distribution and calculation
$50 billion of the Provider Relief Fund was allocated for Medicare facilities and providers as general distribution. The initial $30 billion was distributed on April 10, 2020 and April 17, 2020. These payments were calculated based on the provider’s share of total Medicare fee-for service 2019 reimbursements. The remaining $20 billion distribution began on April 24, 2020. These distributions were allocated proportionally to providers’ share of 2018 net revenue based on submitted cost report data. Providers without adequate cost report data on file AND providers who received their money automatically were able to apply for additional funding through the HHS General Distribution Portal. The application for additional General Distribution funding was required by June 3, 2020.
The payments are determined based on the lesser of two percent of a provider’s 2018 (or most recent completed tax year) net patient revenue or the sum of incurred losses for March and April 2020, which is submitted in the portal during the application process.
These payments are not loans; however, there are terms and conditions that recipient providers must agree to, including how to use the funds and reporting to the U.S. Department of Health and Human Services (HHS).
Terms and Conditions attestation and financial data submission
As a condition to receiving these funds, providers must agree not to seek collection of out-of-pocket payments from a 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.
Within 90 days of receiving the payment, providers must sign an attestation confirming receipt of the funds and agreeing to the terms and conditions of payment. This attestation must be completed via the HHS CARES Act Provider Relief Fund Payment Attestation Portal.
Medicare providers who received a payment from the Provider Relief Fund on or before April 24, 2020 were eligible to apply for additional funds by submitting data about their annual revenues and estimated coronavirus-related revenue losses to HHS. After attesting to the terms and conditions as described above, providers submitted revenue information from the most recently filed tax return as well as estimated COVID-19 related lost revenue for March and April 2020.
Applications are being processed on a rolling basis. HHS also continue to reach out to some providers to request additional information regarding the application for additional funding.
Providers who have not received a payment should not use the portal and may still be eligible for payments through other mechanisms, including the remaining Targeted Allocations distributions from the Provider Relief Fund intended for uninsured treatment, areas of high coronavirus impact, rural providers, Indian Health Services, etc.
Payment use and required reporting
When agreeing to the terms and conditions, the healthcare provider certifies that the funds will only be used to prevent, prepare for and respond to coronavirus, or to reimburse the provider only for healthcare-related expenses or lost revenues attributable to coronavirus. Relief payments must not be used for reimbursement of expenses or losses that would otherwise be reimbursed from another source.
HHS updated the FAQ document on June 13, 2020 indicating that recipients of the Provider Relief Funds do not need to submit a separate quarterly report to HHS or the Pandemic Response Accountability Committee and that HHS will develop a report containing all information necessary for recipients of the Fund payments to comply with the reporting provision.
While the quarterly reporting requirements seem to have dissipated in this FAQ update, it is important for recipients to remain diligent in tracking their funding and COVID-19 related expenses and lost revenue. In accordance with the Terms and Conditions, recipients are still required to submit reports requested by the Secretary to ensure compliance. HHS will also be requiring recipients to submit future reports related to the use of the Provider Relief Funds and we can expect to receive the content and due date(s) requirements from HHS in the coming weeks.
Action items for recipients
Providers who have received funds should confirm receipt of the payment and read and attest to the terms and conditions through the CARES Act Provider Relief Fund Payment Attestation Portal. Then, recipients should attest to each payment and apply for additional funds through the General Distribution Portal.
Recipients should also continue or start keeping records now to document how Provider Relief Fund payments are spent. Providers should also consider establishing a separate bank account and setting up a general ledger mechanism to track payments. RKL’s Senior Living Services Consulting Group prepared a model to assist fund recipients with Provider Relief payment tracking and allocation of funds stemming from coronavirus-related revenue losses and expenses. Contact your RKL advisor for assistance and support with this tracking and reporting requirement.