HHS Releases New Frequently Asked Questions Regarding CARES Act Provider Relief Funds - April 2021

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Last week, HHS released eleven modified Frequently Asked Questions (FAQs) regarding payments distributed to providers via the CARES Act Provider Relief Fund. The FAQs cover audits and overpayments, sharing funds with subsidiaries, and more.

The modified FAQs broadly discuss the following general categories: (1) Terms and Conditions; (2) Ownership Structures and Financial Relationships; (3) Use of Funds; and (4) Phase 3. Notably, the FAQs remind providers that HHS reserves the right to audit Provider Relief Fund recipients now or in the future and is authorized to collect any Provider Relief Fund amounts that were overpaid or not used in a manner consistent with program requirements or applicable law. Providers must also remember that Provider Relief Fund payments must be expended no later than June 30, 2021, and HHS will provide directions about how to return unused funds at a later date. Additionally, the FAQs clarify that a parent organization can allocate Provider Relief Fund General Distribution payments to subsidiaries that do not report income under their parent’s employee identification number.

Furthermore, it appears HHS deleted an FAQ on how Medicaid disproportionate share hospitals (DSHs) can use Provider Relief Fund General and Targeted Distribution payments. As we previously reported here, the FAQ explained that if a hospital had received Medicaid DSH payments for the uncompensated costs of furnishing inpatient and/or outpatient hospital services to Medicaid beneficiaries and individuals with no source of third party coverage for the services, those expenses would be considered reimbursed by the Medicaid program and would not be eligible to be covered by money received from a General or Targeted Distribution payment. With the removal of this FAQ, HHS no longer has any public guidance on the relationship between Provider Relief Fund payments and Medicaid DSH payments.

The complete FAQ document is available 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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