Resources

Client Alerts, News Articles, Blog Posts, & Multimedia

Everything you need to know about BMD and the industry.

Important Updates, Deadlines, and Clarifications for the HHS Provider Relief Funds

Client Alert

HHS Provider Relief Fund Recap

On May 20, 2020, HHS made important updates and clarifications regarding the General Distribution payments to providers.  Between April 10, 2020 and April 24, 2020, HHS distributed an initial $30 billion to providers based on the provider’s 2019 Medicare fee-for-service receipts. These funds were distributed automatically and providers did not need to submit an application in order to receive these funds. The funds were originally touted as a “no strings attached” stimulus payment reserved for healthcare providers. But HHS issued a 10-page Terms and Conditions and required that providers sign an attestation confirming receipt of the funds and agreeing to the Terms and Conditions. For more information on eligibility and the Terms and Conditions, please click here.  

Providers had 30 days from the date of receipt to attest to receipt of these funds. HHS then extended this time frame an additional 45 days. Provider received the funds between April 10, 2020 and April 24, 2020. Thus, providers that received their funds on April 10, 2020 must attest by May 25, 2020. Providers that received their funds on April 24, 2020 must attest by June 8, 2020. However, that date is now June 3, 2020 as further explained below.  

HHS also allocated an additional $20 billion to be distributed as General Distribution payments as Round 2 payments.  Providers must apply for Round 2 payments, which will be distributed based on the provider’s entire net patient revenue and for purposes of offsetting the provider’s lost revenue due to the COVID-19 pandemic. Providers that received and attested to Round 1 payments are eligible to apply for Round 2 payments. Providers that desire to apply for Round 2 payments must submit tax information and financial data supporting lost revenue for March 2020 and April 2020. The deadline to submit this information and apply for Round 2 funds is June 3, 2020. Providers applying for Round 2 funds must agree to an 11-page Terms and Conditions that is very similar to the Terms and Conditions for Round 1 payments.

Here are some key takeaways as we near the deadlines:

  1. Providers should immediately attest to Round 1 or refund the monies.
  2. Providers should review lost revenue calculations (from March 2020 and April 2020 as well as projected ongoing lost revenue) to evaluate whether to apply for Round 2.
  3. Providers should work with their accountant to apply for Round 2 funds by submitting the required tax forms and financial statements.
  4. Providers should maintain COVID-related expenses and updated lost revenue calculations in accordance with their HHS Fund Policy. Lost revenue calculations and financial information should be updated monthly.  

Is there a repayment obligation?

No. These funds are federal grants that do not need to be repaid. However, these federal grants are governed by federal regulations and must be used in accordance with their intended purpose, as outlined in the Terms and Conditions. Pursuant to 45 CFR §75.302, all healthcare providers that received payments from HHS under the CARES Act Provider Relief Fund must have a policy that outlines proper use of the funds and accounting. 

Should I attest to Round 1? If I do not fill out the attestation and do not return the funds, aren’t I “deemed” to have attested?

We recommend that providers affirmatively attest and not be “deemed” to attest. First, providers must confirm the amount received through the attestation portal. This will proactively notify HHS the amount the provider received. If the provider received more than intended, HHS will likely take action earlier to work with the provider in refunding any excess. Second, providers may not apply for Round 2 funds until the provider affirmatively attests to the Round 1 distributions.  

I underwent a change of ownership in 2019.  Am I eligible to attest to Round 1?

If you underwent a change of ownership, purchase, sale, merger, or other change in ownership or information, you may not be eligible to attest to the funds. HHS issued new FAQs regarding these specific factual scenarios. As these are fact-intensive determinations; we recommend scheduling a consultation. 

What if I already attested to Round 1 (initial $30 billion of Provider Relief Funds)? Must I submit additional financial information?

Despite some misleading statements on the HHS website, we confirmed with the Provider Relief Hotline that there is no obligation to submit tax documents or financial statements evidencing lost revenue if the provider is only attesting to receipt of the Round 1 funds and does not desire to apply for additional funding. 

Should I apply for Round 2 funds?

You should only apply for Round 2 funds if your overall lost revenues and COVID-related increased expense exceed the amount of funding you received in Round 1. To apply for Round 2 payments, you will need the following information:

  • TIN (that received Round 1 funds and submitted an attestation)
  • TINs of any subsidiary organizations (that do not file separate tax returns)
  • Estimate of lost revenue for March 2020 and April 2020 (using a reasonable accounting methodology)
  • Copy of most recent tax filing (2017, 2018, or 2019) 

Further, if your Round 1 payment was equal to or more than 2% of your 2018 patient revenue, you will not be eligible for additional funds.  

It is important to note that eligibility for Round 2 is determined by HHS based on the information submitted by the provider.  HHS will review the provider’s submission and make a final determination as to eligibility. Thus, if the Round 1 payment was not sufficient to cover lost revenue, the provider should apply for Round 2. 

If I receive HHS Provider Relief Funds, am I eligible for other loans, stimulus payments, grants, or similar programs?

Yes. The HHS Provider Relief Funds are part of a $100 billion fund established through the CARES Act that is specifically designed to provide reimbursement to healthcare providers for healthcare-related expenses and lost revenue attributable to COVID-19. The Terms and Conditions contemplate that the provider may also receive funding, loans, and payments from other sources such as the EIDL, PPP, and CMS Accelerated/Advance Payment Program. To be clear, a provider cannot use HHS Funds for expenses or lost revenue that is reimbursement or allocated to another funding source or loan program.

Is the information I submit public record?

HHS has posted a list of providers and the amount of Provider Relief Funds distributed to them; however, financial data will not be publicly available. 

For more information, please contact Amanda L. Waesch at alwaesch@bmdllc.com or 330-253-1985.


BMD Makes 2023 U.S. News & World Report "Best Law Firms" Edition

Best Law Firms 2023

EEOC’s New “Know Your Rights” Poster to Replace “EEO is the Law” Poster

Under federal law, covered employers are required to post a notice in the workplace describing federal antidiscrimination laws. The Equal Employment Opportunity Commission (EEOC) prepares the mandatory posters summarizing antidiscrimination laws and explaining how employees and applicants can file a complaint if they believe they have experienced job discrimination. On October 19, 2022, the EEOC released a new poster: “Know Your Rights: Workplace Discrimination is Illegal,” replacing the “EEO is the Law” poster. Employers must now use the poster captioned as “Know Your Rights: Workplace Discrimination is Illegal – Revised 10/20/22.” Employers may be reprimanded for failure to appropriately and compliantly post the updated poster.

FAQs:  Administrative Fees Under Medicare

Late patients, last-minute cancellations, and difficulty in collecting fees are all common complaints from our healthcare clients.  As such, it is no wonder that a common topic among our healthcare clients revolves around what administrative fees can be charged to patients and related issues.

Community Banks: Collaboration, not isolation, is the key to protecting/ enhancing the cannabis business you pioneered

As we prepare for the plenary session of the informal institutional cannabis lenders community announced in my previous article, I am pleased to advise that participants now include 5 of the best-known dedicated loan funds; a select group of commercial banks ranging in size from single state community banks to mid-size regionals making cannabis loans into the mid-8 figures; and, a syndicator of credit union cannabis loans.

Inflation Reduction Act: Healthcare Provisions

On August 16, 2022, President Joe Biden signed into law the Inflation Reduction Act (the “Act”), a landmark climate, healthcare, and tax bill. Though the Act’s climate provisions have received most of the media attention, the healthcare aspects of the Act present some of the most significant changes to the American healthcare system since the passage of the Affordable Care Act.