On June 9, 2020, HHS announced that it will distribute, through the Health Resources and Services Administration (HRSA), two new rounds of funding to healthcare providers treating low-income and uninsured patients during the COVID-19 pandemic. HHS plans to distribute approximately $15 billion to eligible Medicaid and Children's Health Insurance Program (CHIP) providers, so long as those providers have not previously received federal aid through the Provider Relief Fund General Allocation during the pandemic. Additionally, HHS will send $10 billion to certain hospitals primarily serving uninsured and lower-income areas – often known as “safety net” hospitals. The distributions will come from the Provider Relief Fund and will occur as early as this week for safety net hospitals, HHS announced. HHS’s full press release is available here.

Details of Medicaid/CHIP Provider Distribution

HHS will use updated provider data to determine its new $15 billion round of Provider Relief Fund payments, which will be at least 2% of reported gross revenue from patient care. Beginning June 10, 2020, an “enhanced” Provider Relief Fund Payment Portal is available for Medicaid and CHIP providers to report annual patient revenue. To qualify for the new funds, the provider must participate in state Medicaid and CHIP programs and/or Medicaid and CHIP managed care organizations (MCOs), and the provider must not have received General Distribution funding. The provider must also have directly billed the state program or managed care plan for services between January 1, 2018 and May 31, 2020. HHS estimates that nearly one million providers will qualify for this round of funding.

Details of Safety Net Hospital Distribution

The new $10 billion distribution of Provider Relief Funds is intended to “recogniz[e] the incredibly thin margins these [safety net] hospitals operate on,” and hospitals should expect the funds to arrive via direct deposit within a week, HHS said. To qualify, hospitals must have:

  • A Medicare disproportionate payment percentage (DPP) of 20.2% or more;
  • Average uncompensated care per bed of $25,000 or more; and
  • Profitability of 3% or less, as reported to CMS in the hospital’s most recent cost report.

If they qualify, the hospitals can expect to receive an amount within the range of $5 million to $50 million.

In its announcement, HHS also reiterated its call for all hospitals to update their COVID-19-positive inpatient admissions information for January 1, 2020 to June 10, 2020. HHS will use the information to distribute additional funding rounds to hospitals “in COVID-19 hotspots.” The deadline to submit updated information is June 15, 2020 at 9:00 P.M. E.T.

Additional Provider Relief Fund data is summarized by HHS here.

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