HHS Provider Relief Fund: General Distribution FAQ Updates; Addition of Targeted Allocation FAQs

Chambliss, Bahner & Stophel, P.C.The U.S. Department of Health and Human Services (HHS) has updated its Frequently Asked Questions (FAQs) regarding the $50 billion general allocation from the Provider Relief Fund and has issued new FAQs regarding the targeted distributions for rural and high impact areas.

Updated General Distribution FAQs

HHS has provided additional guidance regarding the following issues in a series of updates dated May 12, 2020, and May 14, 2020:

  • Medicare Advantage – Providers billing through the Medicare Advantage program who did not receive funding under the general distribution may be included in future allocations.
  • Attestations
    • 45 Days to Attest – Although previously announced by HHS, the FAQs now reflect that a provider has a 45 day window (as opposed to 30) to attest to accepting funding and meeting the terms and conditions through the attestation portal
    • Confirming Amount – The attestation portal requires a provider to confirm (1) receipt of payment and the amount, and (2) agreement to the terms and conditions. 
    • Accepting One of Two Payments – A provider who received two direct payments through the general distribution may choose to accept one payment and reject the other. Rejecting one payment will not mean that the provider has forfeited the ability to later accept future distributions.
  • Returns
    • ACH – A provider must return a payment received by ACH via ACH. If a provider’s financial institution will not allow an electronic payment return, the provider is to contact UnitedHealth Group.
    • Check – A provider who received a payment by check and has not deposited it may destroy, shred, or securely dispose of it. If the provider has already deposited a payment, it should mail a refund check to the address provided by HHS.
  • Public List – All providers who affirmatively attest to receipt of payment or who retain the funds for more than 45 days will be included in the public release of providers and payments through the database maintained by the Centers for Disease Control and Prevention (CDC). Data within this database will be updated bi-weekly and will reflect only funds attested to (i.e., it is possible that a provider may have actually received more funds than are reflected by the CDC’s list). HHS has no plans to include additional data fields in the CDC report.
  • Distribution of the Second $20 Billion Wave – The second $20 billion wave of dollars was distributed to augment the initial $30 billion wave, so that a provider’s total allocated portion of the $50 billion general distribution reflects the provider’s share of 2018 net patient revenue. The allocation methodology is designed to provide relief to providers who bill Medicare fee-for-service, with at least 2% of that provider’s net patient revenue regardless of the provider’s payer mix. Payments are determined based on the lesser of:
    • 2% of a provider’s 2018 (or most recent complete tax year) net patient revenue, or
    • the sum of incurred losses for March and April of 2020.

If the initial general distribution payment the a provider received between April 10 and April 17 (from the first $30 billion distribution) was determined to be at least 2% of the provider’s annual patient revenue, the provider will not receive additional general distribution payments.

  • Estimating 2% of Patient Revenue – To determine a provider’s approximate general distribution payment, use this equation
    • (Individual Provider Revenues/$2.5 Trillion) X $50 Billion = Expected Combined General Distribution

To estimate a provider’s payment, the provider may need to use “gross receipts or sales” or “program service revenue.” Providers are encouraged to work with a tax professional for accurate submission. This includes any payments under the first $30 billion general distribution as well as under the $20 billion general distribution allocations.  

Providers may not receive a second distribution payment if the provider received a first distribution payment of equal to or more than 2% of patient revenue. In other words, providers, who received an initial payment from the first $30 billion wave and submitted revenue information regarding the second $20 billion wave, may not receive a second payment if the initial payment received from the first $30 billion is determined to be at least 2% of the provider’s annual patient revenue.

  • Processing “Second” Payments – HHS is reviewing uploaded financial information submitted by providers in association with the application for payments from the second $20 billion wave. Payments will go out weekly, on a rolling basis, as information is validated.
  • Receiving Additional Funding Through Targeted Distributions – Additional funding through targeted distributions is still available even if providers have already received payment from the general distribution fund.
  • Application Modifications – Providers can resubmit a general distribution application. HHS will review the most recent application.
  • Distributing Funds Throughout a Health System – If a provider owns several hospitals, the provider has discretion to allocate the funds to support health care expenses and lost revenue throughout their system, so long as they are not reimbursed from other sources and other sources were not obligated to reimburse them.
  • Institutions Without IRS Filings –Guidance is given to such providers on the types of supporting documentation to submit to HHS.

In addition to updating the general distribution FAQs, HHS has also provided for the first time FAQs regarding the targeted distributions to rural and high impact area providers. Those FAQs are linked here.

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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