More COVID-19 Relief Funding on the Way for Healthcare Providers

The Department of Health and Human Services (HHS) has announced a new $20 billion distribution for healthcare providers from the Coronavirus Aid, Response, and Economic Security (CARES) Act Provider Relief Fund. Beginning on April 24, certain providers will receive funds based on information contained in their Centers for Medicare and Medicaid Services (CMS) cost reports.

The CARES Act allocated $100 billion to the Provider Relief Fund for hospitals and healthcare providers. Half of this fund is to be distributed broadly to providers as part of a general allocation, and half is reserved for targeted distribution, including regions highly impacted by COVID-19, rural providers, care of uninsured COVID-19 patients, and the Indian Health Service. Earlier this month, healthcare providers received a share of the first $30 billion, and the $20 billion distribution that begins April 24 completes the general allocation.

According to HHS, the distribution of the $50 billion, in aggregate, is to be allocated “proportional to providers’ share of 2018 net patient revenue.” The initial distribution, based on Medicare fee-for-service reimbursement levels, was criticized as disadvantaging facilities with low Medicare volumes, such as safety-net hospitals and children’s facilities. The second distribution is meant to correct the inequities of the first distribution but may create additional issues. Because not all providers submit cost reports, CMS does not currently have an accurate denominator on which to base its calculations and is, therefore, requesting this data from providers.

Providers who do not typically submit cost report data (e.g., physician practices and ambulatory surgery centers) will be required to submit their 2018 net patient revenue data in order to receive the relief funds. This information will be submitted via a web portal that is to be opened by April 24.

KSM encourages healthcare providers to only submit their 2018 revenue information once CMS provides clear guidance on the definitions of specific terms, which are especially relevant for cash-based practices. We encourage clients to contact their KSM advisor for assistance in determining the appropriate data to submit to HHS.

Additionally, the Provider Relief Fund allocates targeted funding for the care of the uninsured. Starting April 27, physicians who have provided COVID-19 testing or treatment (including telehealth services) to uninsured patients may sign up for claims reimbursement. Claim submission is scheduled to begin May 6. More information can be found on the Health Resources & Services Administration website.

We will continue to provide updates as more information becomes available. For more information contact your KSM advisor or complete this form.

Visit the KSM COVID-19 Resource Center