CARES Act Provider Relief Fund Reporting Requirements and Government Scrutiny

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The federal government established many new funds in 2020 to assist health care providers with the financial burden of COVID-19. One such fund, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) Provider Relief Fund (PRF), is a $178 billion federal appropriation to health care providers impacted by COVID-19. Since its inception, the CARES Provider Relief Fund has consistently changed and its guidance evolved. From shifting administrative guidance on required attestations and reporting, to approving new funding distributions every few weeks, the federal government continuously issued reporting guidance and then changed course in response to industry feedback—all while ramping up its PRF monitoring and penalties to combat potential misuse of PRF distributions.

Beginning in March 2020, Congress appropriated $175 billion through the CARES Act, the Paycheck Protection Program and Health Care Enhancement Act, and the Coronavirus Response and Relief Supplemental Appropriations Act to reimburse providers for health care-related expenses or lost revenues attributable to COVID-19.[1] In December 2020, Congress appropriated an additional $3 billion to the PRF through the Consolidated Appropriations Act of 2021 (2021 Appropriations Act).[2] The Health Resources & Services Administration (HRSA), as part of the U.S. Department of Health and Human Services (HHS), refers to these appropriations as the “Provider Relief Fund.”

PRF recipients receive funds via General Distributions and Targeted Distributions. General Distribution PRF recipients include Medicare fee-for-service providers, Medicaid providers, Medicaid managed care plans, dentists, assisted living facilities, and behavioral health providers.[3] Per HRSA’s PRF Frequently Asked Questions (FAQs) dated July 1, 2021, a General Distribution recipient has “discretion in allocating the Provider Relief funds to support its subsidiaries’ health care related expenses or lost revenue attributable to COVID-19, so long as the payment is used to prevent, prepare for, or respond to coronavirus and those expenses or lost revenue are not reimbursed from other sources or other sources were not obligated to reimburse.”[4]

Targeted Distribution PRF recipients include rural providers, skilled nursing facilities, tribal hospitals and clinics, urban health centers, safety net hospitals, and hospitals that have a high number of confirmed COVID-19 inpatient admissions.[5] HRSA’s Terms and Conditions for Targeted Distributions further circumscribe providers’ use of such funds, based on the Targeted Distribution type.[6]

Throughout the pandemic, HHS has permitted providers to request additional PRF distributions, as well. The 2021 Appropriations Act also permits parent organizations to allocate PRF distributions to subsidiaries, as long as the original PRF recipient remains responsible for reporting on the funds.[7]

HRSA requires all PRF recipients to register through HRSA’s reporting portal, which went live on July 1, 2021.[8] Each provider must report by either September 30, 2021; March 31, 2022; September 30, 2022; or March 31, 2023, depending on when the provider received its PRF payment. PRF recipients also must fully use their PRF distributions by either June or December of 2021 or 2022, depending on their date of receipt, or else return their unused PRF distributions to HRSA.[9] Separate reporting requirements also apply to the U.S. Small Business Administration’s Paycheck Protection Program (PPP) and the Centers for Medicare & Medicaid Services’ (CMS)’ Medicare Accelerated and Advance Payments Program (MAPP) funds.

PRF recipients must attest to each PRF distribution’s Terms and Conditions, certifying that they will “submit reports as [HHS] determines are needed to ensure compliance with conditions that are imposed” on each PRF payment.[10] HHS released varying PRF reporting guidance from July 2020 to June 2021 in response to stakeholder feedback. Under the agency’s June 11, 2021, guidance, HRSA requires PRF recipients to report the following on and after July 1, 2021: general and administrative expenses, health care-related expenses, net unreimbursed expenses, and lost revenues that are attributable to COVID-19.[11] Per HRSA’s FAQs dated July 1, 2021, “all recipients will be required to substantiate that these funds were used for health care-related expenses or lost revenues attributable to coronavirus, and that those expenses or losses were not reimbursed from other sources and other sources were not obligated to reimburse them.”[12]

HRSA’s PRF Reporting Portal Data Entry Worksheets as of July 1, 2021 specifically require data inputs of many data points, including: other financial assistance received, other PRF payments, unreimbursed expenses attributable to COVID-19, actual patient care revenue received in calendar years 2019 and 2020, lost revenues attributable to COVID-19, and facility, personnel, and patient metrics for calendar years 2019, 2020, and 2021.[13] Additionally, HRSA released guidance on July 1, 2021 requiring PRF recipients to retain supporting documentation of their submitted PRF reports for a minimum of three years, citing 45 C.F.R. § 75.361.[14]

The CARES Act requires PRF recipients of more than $150,000 to submit quarterly reports to both HHS and the Pandemic Response Accountability Committee (PRAC).[15] However, in lieu of these quarterly reports, HHS in June 2020 instructed PRF recipients to submit alternate reports and explained that the agency instead posts PRF recipient names and amounts in its Tracking Accountability in Government Grants System (TAGGS) system.[16] It remains to be seen whether HRSA will change its stance on PRAC reports in the future, especially in light of continued congressional scrutiny of PRF payment usage. In addition to these requirements, PRF recipients that expend $750,000 or more in aggregated federal financial assistance annually must comply with certain audit requirements.[17]

Government agencies are also required to report the use of PRF distributions. For example, the Office of Inspector General within HHS (OIG) must submit a final report of its audit findings on the PRF to the House and Senate Appropriations Committees no later than three years after final PRF payments are made.[18] Additionally, HHS was required to provide a report to the House and Senate Appropriations Committees on “obligation of [PRF] funds, including obligations to such eligible health care providers, summarized by State of the payment receipt” by the end of February 2021.[19] HHS must thereafter submit updated reports to Congress “every 60 days until [PRF] funds are expended.”[20] Providers should continue to review carefully HRSA’s guidance implementing the 2021 Appropriations Act.

Despite shifting guidance from the agency, providers that fail to comply with the terms or conditions of their PRF payments may find themselves subject to recoupment of some or all of their payment. HHS has emphasized that it will implement significant antifraud monitoring of the PRF distributions. Additionally, OIG will oversee HRSA’s efforts to ensure that federal dollars are used appropriately. Indeed, OIG announced in 2020 several audits of PRF recipient reporting and CMS oversight of the PRF, including audits to ensure provider compliance with the PRF Terms and Conditions.[21] In December 2020, HHS created a False Claims Act Working Group to combat fraud associated with PRF distributions.[22] In February 2021, the U.S. Department of Justice (DOJ) charged a Michigan woman for “intentionally misapproprat[ing] government funds that were designed to aid medical providers in the treatment of patients suffering from COVID-19 and [instead using] them for her own personal expenses.”[23] An OIG principal deputy inspector general stated in a speech at AHLA’s 2020 Fraud and Compliance Forum that the government “will have many watchful eyes on the PRF.” HRSA will likely announce more PRF investigations and noncompliance penalties in the coming months.

Even as COVID-19 cases decrease and vaccinations continue, the financial challenges of the pandemic have continued. All PRF recipients will need to monitor HRSA’s evolving guidance governing such payments to ensure they do not run afoul of HRSA’s rules. Providers that fail to pay close attention to the agency’s rules as HRSA continues to distribute PRF payments may find themselves with a whole new set of challenges when the pandemic fully subsides.

Republished with permission. The full article for, "CARES Act Provider Relief Fund Reporting Requirements and Government Scrutiny," was published in Health Law Weekly by the American Health Law Association (AHLA) on September 24, 2021.

 
[1] H.R. 748, CARES Act, 116th Congress (2019-2020); H.R. 266, Paycheck Protection Program and Health Care Enhancement Act, 116th Congress (2019-2020); H.R.6074, Coronavirus Preparedness and Response Supplemental Appropriations Act, 116th Congress (2019-2020). 

[2] H.R. 133, Consolidated Appropriations Act, 2021, 116th Congress (2019-2020).

[3] Health Resources & Servs. Admin., Past General Distributions, https://www.hrsa.gov/provider-relief/past-payments/general-distribution.

[4] Health Resources & Servs. Admin., CARES Act Provider Relief Fund, Frequently Asked Questions, https://www.hrsa.gov/sites/default/files/hrsa/provider-relief/provider-relief-fund-faq-complete.pdf.

[5] Health Resources & Servs. Admin., Past Targeted Distributions, https://www.hrsa.gov/provider-relief/past-payments/targeted-distribution.

[6] Health Resources & Servs. Admin., Terms and Conditions, https://www.hrsa.gov/provider-relief/past-payments/terms-conditions.

[7] H.R. 133, Consolidated Appropriations Act, 2021, 116th Congress (2019-2020).

[8] Health Resources & Serv. Admin., Provider Relief Fund Reporting Portal, https://prfreporting.hrsa.gov/s/.

[9] Health Resources & Serv. Admin., Provider Relief Fund Reporting Requirements and Auditing, https://www.hrsa.gov/provider-relief/reporting-auditing. Citing “challenges providers are facing given the Covid surges and natural disasters around the country,” HRSA indicated that, while the September 30, 2021 PRF reporting deadline has not changed, providers will have a final 60-day grace period during which the agency will not initiate collection activities or similar enforcement actions. The grace period only pertains to the September 30, 2021 report submission deadline and does not change the period of availability for use of PRF payments.

[10] Health Resources & Servs. Admin., Terms and Conditions, https://www.hrsa.gov/provider-relief/past-payments/terms-conditions.

[11] Health Resources & Servs. Admin., Provider Relief Fund General and Targeted Distribution Post-Payment Notice of Reporting Requirements (June 11, 2021).

[12] Health Resources & Servs. Admin., CARES Act Provider Relief Fund, Frequently Asked Questions, https://www.hrsa.gov/sites/default/files/hrsa/provider-relief/provider-relief-fund-faq-complete.pdf.

[13] Health Resources & Servs. Admin., HRSA PRF Reporting Portal - Data Entry Workbook, available at https://www.hrsa.gov/provider-relief/reporting-auditing.

[14] Health Resources & Servs. Admin., Provider Relief Fund Post-Payment Reporting Requirements Stakeholder Toolkit (July 1, 2021).

[15] Health Resources & Servs. Admin., Terms and Conditions, https://www.hrsa.gov/provider-relief/past-payments/terms-conditions.

[16] Health Resources & Servs. Admin., CARES Act Provider Relief Fund, Frequently Asked Questions, https://www.hrsa.gov/sites/default/files/hrsa/provider-relief/provider-relief-fund-faq-complete.pdf.

[17] Health Resources & Servs. Admin., CARES Act Provider Relief Fund, Frequently Asked Questions, https://www.hrsa.gov/sites/default/files/hrsa/provider-relief/provider-relief-fund-faq-complete.pdf.

[18] H.R. 133, Consolidated Appropriations Act, 2021, 116th Congress (2019-2020).

[19] H.R. 133, Consolidated Appropriations Act, 2021, 116th Congress (2019-2020).

[20] H.R. 133, Consolidated Appropriations Act, 2021, 116th Congress (2019-2020).

[21] U.S. Dept. of Health & Human Servs., Office of Inspector General, Active Work Plan Items, https://oig.hhs.gov/reports-and-publications/workplan/active-item-table.asp.

[22] U.S. Dept. of Health & Human Servs., HHS Announces False Claims Act Working Group to Enhance Efforts to Combat Fraud and Focus Resources on Bad Actors, https://public3.pagefreezer.com/browse/HHS%20%E2%80%93%C2%A0About%20News/20-01-2021T12:29/https://www.hhs.gov/about/news/2020/12/04/hhs-announces-false-claims-act-working-group-enhance-efforts-combat-fraud-and-focus-resources-bad-actors.html.

[23] U.S. Dept. of Justice, Woman First in the Nation Charged with Misappropriating Monies Designed for COVID Medical Provider Relief, https://www.justice.gov/opa/pr/woman-first-nation-charged-misappropriating-monies-designed-covid-medical-provider-relief.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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