Reporting Portal Open for Period 2 Provider Relief Fund Payments

Healthcare practices that received Provider Relief Fund payments in excess of $10,000 in aggregate between July 1, 2020, and December 31, 2020, are required to report on how they spent those dollars by March 31 of this year. The Health Resources and Service Administration’s (HRSA) has opened the reporting portal for funds received during that timeframe, defined as Period 2. The moneys were to be used by December 31, 2021. Filers who were required to report in Phase 1 will be required to provide information on the related expenditures for Q3 and Q4 of 2021. (Filers who did not need to file in period one will need to report on information related to each quarter from 2019 to 2021)

Over the past two years, the HRSA has distributed funds to healthcare providers in four phases. Initially, in Phase 1, payments consisted of 2 percent of providers’ 2019 Medicare reimbursement amounts. Phase 2 welcomed additional practices, like assisted living facilities and others that don’t accept Medicare, and smaller practices, like dentists and chiropractors. The intent was to supplant revenue lost to COVID in 2020, to make these practices whole based on their 2019 revenues. A Phase 3 round extended additional payments to more providers, like rural communities and nursing homes, and Phase 4 distributions, which began in October 2021, allowed virtually any healthcare related provider to apply in an attempt to even the playing field throughout the industry.

The payments are intended to cover losses related to the pandemic, to prevent, prepare for and recover from COVID-related losses. Providers can spend the money on indirect as well as direct costs necessitated by the pandemic. For example, a practice paying $10,000 a month for rent in 2019 and serving 10,000 patients per month, but only 8,000 patients per month in 2020, could report a $2,000 per month indirect COVID-related expense. While all providers receiving payments of more than $10,000 in period 2 must report, the reporting requirements are enhanced as the aggregate payments increase, growing substantially more detailed at the $500,000 then $750,000 amounts.

Indirect costs in particular can be difficult to identify and calculate, especially for many small and mid-size providers new to the relief programs with Phase 2. As such, HBK Healthcare Solutions has been working with providers to help them develop complete and accurate reporting. As well, the HRSA has posted a Provider Relief Fund Lost Revenues Guide, which details three options for reporting revenue. Included is clarification that quarters with positive changes in revenues will be treated as zero—that is, the increase in revenue in a single quarter compared to the base period will not impact the calculation for that quarter.

About the Author(s)

Joshua Zarlenga, CPA, MBA
Joshua Zarlenga is a Principal in the Youngstown, Ohio office of HBK CPAs & Consultants with extensive experience in the areas of taxation, financial reporting, profit enhancement and business consulting with closely-held companies. He serves a wide variety of industries including manufacturing, construction, medical practices, senior living services and wholesale distribution, as well as businesses ranging from small, locally-owned companies to large corporations. He can be reached at 330-758-8613, or by email at

Hill, Barth & King LLC has prepared this material for informational purposes only. Any tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or under any state or local tax law or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein. Please do not hesitate to contact us if you have any questions regarding the matter.