The CARES Act appropriated $100 billion to establish a Provider Relief Fund to distribute payments to health care entities across the country that have been affected by COVID-19. Earlier this month, HHS began the delivery of an initial $30 billion in relief funding. On April 22, the Department of Health and Human Services (HHS) announced additional allocations of money appropriated for the CARES Act Provider Relief Fund, which accounts for $70.4 billion in total funding. The general and targeted allocations of the CARES Act Provider Relief Fund is as follows:
$50 billion of the Provider Relief Fund is allocated for general distribution to Medicare facilities and providers impacted by COVID-19, based on eligible providers’ 2018 net patient revenue. The general distribution is available to all Medicare providers, including hospitals, independent physician groups, and skilled nursing facilities.
An initial $30 billion was distributed immediately, proportionate to a provider’s share of Medicare fee-for-service reimbursements in 2019. $26 billion was delivered to providers’ bank accounts on April 10th and the remaining $4 billion was distributed a week later. Because this distribution was related to a provider’s Medicare revenue, a clear disparity emerged for providers who do not treat a large number of Medicare patients.
As a result, this week HHS will begin distribution of the remaining $20 billion of the general distribution to these providers to augment their initial allocation so the total $50 billion general distribution is allocated proportional to providers’ share of 2018 net patient revenue.
A number of providers will automatically be sent an advance payment based on the revenue data they submit in CMS cost reports. Providers without adequate cost report data on file will need to submit their revenue information at https://www.hhs.gov/providerrelief for additional general distribution funds. Payments will go out on a weekly, rolling basis as information is validated. Providers who receive their money automatically will still need to submit their revenue information so that it can be verified.
Providers who receive funds from the general distribution are required to sign an attestation confirming receipt of funds, agree to the terms and conditions of payment, and confirm their CMS cost report. The terms and conditions include a number of measures, including those to help prevent fraud and misuse of the funds. All 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. Additionally, providers must agree to charge in-network rates to COVID-19 patients who are out of network. For a detailed discussion of applicable terms and conditions, view this related blog entry.
Allocation for COVID-19 High Impact Areas
As discussed in our previous article, hospitals in areas significantly impacted by the COVID-19 outbreak will receive $10 billion in allocations. To inform how these funds are distributed, HHS asked hospitals to provide specific information via an authentication portal by 3:00 p.m. PT on Saturday, April 25.
Each hospital was asked to provide:
- Medicare Tax Identification Number (TIN)
- Total number of intensive care unit beds as of April 10, 2020
- Total number of admissions with a positive diagnosis for COVID-19 from January 1, 2020, to April 10, 2020.
- National Provider Identifier
Allocation for Treatment of the Uninsured
Healthcare providers who treat uninsured COVID-19 patients will receive an unspecified amount in allocations. Providers who have provided treatment for uninsured COVID-19 patients on or after February 4, 2020 may request claims reimbursement and be reimbursed at Medicare rates subject to available funding.
Providers may begin to register for the program on April 27, 2020 and submit claims in early May 2020. For more information regarding this program, please visit, coviduninsuredclaim.hrsa.gov.
Allocation for Rural Providers
Rural health clinics and hospitals will receive $10 billion in allocations. HHS cited the significant financial exposures to potential revenue declines and increase in COVID-19 expenses for this decision. The money will be distributed as early as next week on the basis of operating expenses, using a methodology that distributes payments proportionately to each facility and clinic.
Allocation for Indian Health Service
Indian Health Service facilities will receive $400 million in allocations. HHS cited the obvious strain currently being experienced by Indian Health Service providers for this decision. The money will be distributed as early as next week on the basis of operating expenses for facilities.
Although unclear on the approximate amount, separate funding will be allocated for providers that solely take Medicaid.