HHS Provider Relief Funds: 2021 Reporting Requirements

Roughly $175 billion were distributed to America’s healthcare providers in 2020 through the HHS Provider Relief Fund. 

The intent of this money was to help hospitals, physicians, dentists, and other healthcare facilities pay for increased COVID-related expenses and supplement lost revenue.

With notable speed and convenience, the government did their job to get money into the hands of healthcare practices that needed it most. 

However, this government assistance came with strings attached. Those who accepted Provider Relief Funds (PRF) are now required to follow strict reporting requirements in 2021.

The purpose of this article is to share all that we know to date about the program and provide you with some information regarding what to expect in the coming months.

We’ll talk about:

• Timeline of PRF Distributions
• Accepting Terms and Conditions
• Reporting Requirements
• Next Steps

Let’s get to it. 

Timeline of PRF Distributions

In total, $175 billion were distributed through three general distributions and a series of additional targeted distributions. 

A timeline can be found on the HHS website here. 

Phase 1

There were two distributions in Phase 1. 

The first distribution began on April 10, 2020. At that time, $30 billion was automatically deposited into the bank accounts of eligible practices that received Medicare fee-for-service reimbursements in 2019.

A second $20 billion distribution began two weeks later. But this time providers were required to submit an application.

In each case, providers were required to sign an attestation confirming receipt of the funds and agreeing to the terms and conditions of payment within 90 days. Not returning the payment within those 90 days was viewed as accepting the terms and conditions.

The application period for Phase 1 closed June 3, 2020.

Phase 2 

A second round of distributions opened up on June 9, 2020. 

Eligibility for an additional $18 billion included providers who participated in state Medicaid/CHIP programs, Medicaid managed care plans, or provided dental care.

Providers could apply to receive funding of up to 2% of their reported total revenue from patient care. 

The application period for Phase 2 closed September 13, 2020.

Phase 3

A final $20 billion distribution began on October 5, 2020.

All eligible providers from Phase 1 and 2 were invited to apply. The application considered financial losses and changes in operating expenses caused by the coronavirus. 

Previously ineligible providers, such as those who began practicing in 2020 were also invited to apply, and an expanded group of behavioral health providers were also eligible for relief payments.

The application period for Phase 3 closed November 6, 2020.

Accepting the Terms and Conditions

In order to accept any PRF distribution, you must have agreed to the terms and conditions.

Among many other stipulations, they state that:

1. You provide care for individuals who may have COVID-19
2. Funds will only be used to reimburse healthcare related expenses or lost revenue attributable to coronavirus
3. You will maintain appropriate records and documentation
4. You will submit any report deemed necessary

The first requirement is pretty straightforward as HHS broadly views every patient as a possible case of COVID-19.

Second, HHS will look closely at how the funds are used. The government has made it very clear that this money must first be applied to reimburse healthcare related expenses before the funds can be used to supplement lost revenue. 

Furthermore, providers are required to follow 45 CFR 75.302 with respect to financial record-keeping. This means that you need a written policy that includes a documented process for ensuring proper allowability of costs and expenses. If you don’t have one, speak with a healthcare business attorney or contact us to learn more. 

Finally, the terms and conditions broadly state that all recipients of PRF payments will be required to report on their use of the funds, and maintain such records for at least three years. 

Reporting Requirements

Any provider who received PRF payments exceeding $10,000 must report required information, including intent, use of funds, and other data elements. 

A brief summary of these reporting requirements have been posted here. 

Key dates

• January 15, 2021: Reporting portal opens for providers
• February 15, 2021: The first mandatory reporting deadline 
• July 31, 2021: The final reporting deadline for providers who did not fully expend PRF funds prior to December 31, 2020

If you use all of your PRF funds in 2020 you’ll only have to report once on February 15. 

Otherwise, you will have an additional 6 months to use the remaining funds through June 30, 2021. Then you must submit a second and final report no later than July 31, 2021.

Guidance

The final reporting data elements guidelines were posted here on November 2, 2020.

It says that recipients must report their use of PRF payments by submitting the following information:

1. Healthcare related expenses attributable to coronavirus that another source has not reimbursed (e.g. PPP funds, EIDL Advance “Grant”, EIDL Loan).
   
2. PRF payment amounts not fully expended on healthcare related expenses attributable to coronavirus are then applied to patient care lost revenues. Recipients may apply PRF payments toward lost revenue, up to the amount of the difference between their 2019 and 2020 actual patient care revenue.
   
   If recipients do not expend PRF funds in full by the end of calendar year 2020, they will have an additional six months in which to use remaining amounts toward expenses attributable to coronavirus but not reimbursed by other sources, or to apply toward lost revenues in an amount not to exceed the difference between 2019 and 2021 actual revenue. For example, the reporting period January – June 2021 will be compared to the same period in 2019, or January – March 2021 will be compared to the same quarter in 2019.

Data Elements

There are four categories of data elements that will be used to fulfill these reporting requirements:

1. Demographic Information
2. Expenses Attributable to Coronavirus Not Reimbursed by Other Sources (2020 only)
3. Lost Revenues Attributable to Coronavirus
4. Additional non-financial data will also be collected (per quarter) 

Let’s look at each in more detail.

1. Demographic Information

This will be the easiest section to complete. It includes basic information such as:

• Reporting entity name
• Tax identification number (TIN)
• National provider identifier (NPI)
• Fiscal year-end date
• Federal tax classification

2. Expenses Attributable to Coronavirus Not Reimbursed by Other Sources (2020 only)

If you received between $10,000 and $499,999 in total PRF payments, you will be required to report healthcare related expenses attributable to coronavirus, net of other reimbursed sources. These expenses must be broken out into two separate sub-categories:

1. G&A expenses
2. Other healthcare related expenses

General and administrative could include:

• Mortgage/rent
• Insurance
• Personnel
• Fringe benefits
• Lease payments
• Utilities/operations
• Other

Other healthcare related expenses could include: 

• Supplies
• Equipment
• Information technology
• Facilities
• Other 

Remember that all qualifying expenses must be attributable to COVID-19. The intent of the Provider Relief Funds is to reimburse marginal increased expenses due to COVID-19.

For example, providers should calculate the increased costs in PPE supplies in 2019 compared to PPE supplies in 2020 (less any grant or funding received by the provider for such items). 

3. Lost Revenues Attributable to Coronavirus

Only after accounting for qualified expenses can you then apply Provider Relief Funds to lost revenues attributable to coronavirus. 

Lost revenues is represented by a negative change in year-over-year actual revenue from patient care related sources.

Lost Revenues Equation:

     2019 Patient Care Revenues

–    2020 Patient Care Revenues

=   Net Change (maximum amount to which Provider Relief Funds can be applied)

Detailed Breakdown

For each quarter in 2019 and 2020, providers must specify patient care revenue they received from:

• Medicare Part A+B
• Medicare Part C
• Medicaid
• Commercial Insurance
• Self-Pay
• Other

In addition, they must also report any other assistance that they received in 2020, such as:

• Treasury, Small Business Administration (SBA) and the CARES Act/Paycheck Protection Program (PPP)
• FEMA CARES Act
• CARES Act Testing
• Local, State, and Tribal Government Assistance
• Business Insurance
• Other Assistance

4. Additional non-financial data will also be collected

The final section of data elements include:

• Personnel Metrics: Total personnel by labor category (full-time, part-time, contract, other: recipient must define), total re-hires, total new hires, and total personnel separations by labor category.
• Patient Metrics: Total number of patient visits (in-person or telehealth), total number of patients admitted, and total number of resident patients.
• Facility Metrics: Total available staffed beds for medical/surgical, critical care, and other beds.

This information must be broken down by quarter as well. 

Next Steps

As you can see, there’s a significant amount of detail in these reporting requirements. HHS claims to use all of these data elements to assess whether recipients properly used PRF payments, consistent with the Terms & Conditions associated with payment.

Depending on how much money you received, you may be wondering if it’s worth keeping.

Unfortunately, as of this writing, it is not possible to return the funds after signing the attestation. Pending a new announcement from HHS, all PRF recipients will be required to submit reports by February 15, whether or not they used the money. 

Until then, it’s a good idea to familiarize yourself with the reporting data elements. Visit HHS.gov to learn more about the Provider Relief Funds, read through all the reporting requirements, and stay tuned to the updated FAQs.