CARES Act Provider Relief Fund
April 10, 2020
By: Eric N. Fischer, Jason L. Giles
The CARES Act authorized $100 billion for provider relief related to COVID-19 losses. Last night HHS authorized an immediate infusion of $30 billion to healthcare providers.
Many healthcare providers have sustained significant costs associated with COVID-19 including preparation costs and decreases in non-COVID-19 patient volume. These payments provide immediate cash-flow to healthcare providers for losses associated with COVID-19. Payments will arrive by direct deposit beginning April 10. These are payments, not loans, to healthcare providers, and will not need to be repaid. Acceptance of these funds does not impact a healthcare providers’ eligibility for the Paycheck Protection Program, Employee Retention Tax Credit, or Small Business Administration Economic Disaster Loans.
- All facilities and providers that received Medicare fee-for-service (FFS) reimbursements in 2019 are eligible for this initial rapid distribution.
- As a condition to receiving these funds, providers must agree not to seek collection of out-of-pocket payments from a COVID-19 patient that are greater than what the patient would have otherwise been required to pay if the care had been provided by an in-network provider.
- Providers will be distributed a portion of the CARES Act Provider Relief Fund based on their share of the $484 billion of Medicare reimbursements paid in 2019.
- A provider can estimate their payment by dividing their 2019 Medicare FFS (not including Medicare Advantage) payments they received by $484,000,000,000, and multiply that ratio by $30,000,000,000. The reimbursement is approximately 6.2% of a healthcare provider’s Medicare FFS.
- Example: Healthcare Clinic A billed Medicare FFS $18 million in 2019. To determine how much they would receive, use this equation:
- $4,000,000/$484,000,000,000 x $30,000,000,000 = $247,933.85
Information for Eligible Healthcare Providers
- HHS has partnered with UnitedHealth Group (UHG) to provide rapid payment to providers eligible for the distribution of the initial $30 billion in funds. Providers will be paid via Automated Clearing House account information on file with UHG or the Centers for Medicare & Medicaid Services (CMS). The automatic payments will come to providers via Optum Bank with "HHSPAYMENT" as the payment description.
- Within 30 days of receiving the payment, providers must sign an attestation confirming receipt of the funds and agreeing to the terms and conditions of payment. The portal for signing the attestation will be open the week of April 13, 2020. Prior to accepting these terms and conditions and agreeing to abide by them, please consult your attorney for advice regarding compliance.
- HHS' payment of this initial tranche of funds is conditioned on the healthcare provider's acceptance of the Terms and Conditions - PDF, which acceptance must occur within 30 days of receipt of payment. The Terms and Conditions provide additional information on the program and restrict the use of the funds on activities including lobbying, abortions, and executive pay. It is a good practice to keep detailed records of the use of all of the funds received to avoid any potential future dispute over impermissible use.
- The Terms and Conditions also require that any healthcare providers receiving more than $150,000 in total funds under the Coronavirus Aid, Relief, and Economics Security Act (P.L. 116-136), the Coronavirus Preparedness and Response Supplemental Appropriations Act (P.L. 116-123), the Families First Coronavirus Response Act (P.L. 116-127), or any other Act primarily making appropriations for the coronavirus response and related activities to submit a report to HHS containing the total amount of funds received from HHS under one of the foregoing enumerated Acts; the amount of funds received that were expended or obligated for reach project or activity; a detailed list of all projects or activities for which large covered funds were expended or obligated, including: the name and description of the project or activity, and the estimated number of jobs created or retained by the project or activity, where applicable; and detailed information on any level of sub-contracts or subgrants awarded by the covered recipient or its subcontractors or subgrantees.
If you have questions about the CARES Act Provider Relief Fund please contact us.
Additional CARES Act Coverage
- CONGRESS INCREASES APPROPRIATIONS TO CARES ACT PROGRAMS
- CARES ACT ESTABLISHES PAYCHECK PROTECTION PROGRAM
- HOW TO APPLY FOR A PAYCHECK PROTECTION PROGRAM LOAN
- 7 FAQS ON UPDATED GUIDANCE TO PAYCHECK PROTECTION PROGRAM
- PPP LOAN FORGIVENESS: AN OVERVIEW
- BEST PRACTICES TO MAXIMIZE PAYCHECK PROTECTION PROGRAM LOAN FORGIVENESS
- FED LAUNCHES MAIN STREET LENDING PROGRAMS FOR SMALL AND MID-SIZED BUSINESSES
- EXPANSION OF OTHER LOANS PROGRAMS
- NEW AND MODIFIED TAX PROGRAMS UNDER CARES ACT
- CARES ACT: EMPLOYEE BENEFIT PROVISIONS
- WHAT CARES ACT MEANS FOR HIGHER EDUCATION INSTITUTIONS
- ADDITIONAL DISTRIBUTION FROM CARES ACT PROVIDER RELIEF FUND
- CARES ACT: MORE THAN STIMULUS MONEY
- CARES ACT PROVIDES INCREASED OPPORTUNITIES FOR INDIVIDUALS TO DEDUCT CHARITABLE CONTRIBUTIONS
- MEDICARE ACCELERATED AND ADVANCE PAYMENT PROGRAM
- FEDERAL RELIEF FOR HEALTHCARE PROVIDERS