HHS Releases $25.5 Billion in COVID-19 Provider Funding

The U.S. Department of Health and Human Services (HHS), through the Health Resources and Services Administration (HRSA), is making $25.5 billion in new funding in COVID-19 relief available to healthcare providers. This funding includes $8.5 billion in American Rescue Plan (ARP) resources for providers who serve rural Medicaid, Children’s Health Insurance Program (CHIP), or Medicare patients, and an additional $17 billion for Provider Relief Fund (PRF) Phase 4 for a broad range of providers who can document revenue loss and expenses due to the pandemic.

Provider Relief Fund Phase 4 payments will be based on lost revenues and expenditures between July 1, 2020, and March 31, 2021. In line with a Biden-Harris Administration commitment to supporting providers with greater needs, the PRF Phase 4 funding will reimburse smaller providers for their lost revenues and COVID-19 expenses at a higher rate than larger providers. PRF Phase 4 will also include bonus payments for providers who serve Medicaid, CHIP, and/or Medicare patients. According to the HHS, these bonus payments will be issued at the generally higher Medicare rates “to ensure equity for those serving low-income children, pregnant women, people with disabilities, and seniors.”

Similarly, HRSA will make ARP rural payments to providers based on the amount of Medicaid, CHIP, and/or Medicare services they provide to patients who live in rural areas, HHS noted in its September 10 release.

“In order to expedite and streamline the application process and minimize administrative burdens, providers will apply for both programs in a single application,” the HHS release noted. “HRSA will use existing Medicaid, CHIP, and Medicare claims data in calculating payments. The application portal will open on September 29, 2021.”

In addition, HHS announced a “final” 60-day grace period for providers who fail to meet the September 30, 2021 deadline for the first PRF Reporting Time Period. While the deadlines to use funds and the Reporting Time Period do not change, “HHS will not initiate collection activities or similar enforcement actions for noncompliant providers during the grace period.”

“We are staying abreast of developments and keeping our clients up to date, even as we await more information from HHS on these newly announced relief measures,” noted Michael DeLuca, director of HBK Healthcare Solutions. “We have worked with our healthcare practices and facilities throughout the pandemic, on their Paycheck Protection Program applications and reporting, their Employee Retention Credits filings, their access to various HHS relief programs, and their daily operational and financial challenges that have been exacerbated by the pandemic. We will remain steadfast in our commitment to serving our healthcare clients as they address the unprecedented and ongoing pandemic-related challenges.”