Client Alerts, News Articles & Blog Posts

Everything you need to know about BMD and the industry.

Provider Relief Funds – Continued Confusion Regarding Reporting Requirements and Lost Revenues

WARNING: Take a deep breath before you read this! And then pat yourself on the back for your continued resilience and ability to adapt and pivot during this unprecedented time! 2021 is seeming to prove to be a continuation of 2020 with one constant – change and uncertainty. In Fall 2020, HHS issued multiple rounds of guidance and FAQs regarding the reporting requirements for the Provider Relief Funds, the most recently published notice being November 2, 2020 and December 11, 2020. Specifically, the reporting portal for the use of the funds in 2020 was scheduled to open on January 15, 2021. Although there was much speculation as to whether this would occur. And, as of the date of this article, the portal was not opened.

The aggregate HHS guidance regarding the reporting requirements basically required providers to report (1) expenses attributable to COVID, and (2) lost revenues attributable to COVID. While those in the healthcare industry would generally agree that expenses attributable to COVID have been predictably defined by HHS, controversy continues to surround the definition of lost revenues attributable to COVID. Under the most recent guidance that we have available, lost revenues is defined as the year-over-year net change in patient care revenues from 2019 to 2020 plus additional assistance received in 2020 (including all PPP, EIDL, and other federal, state, and local assistance). Of course, this changed from guidance issues in early Fall 2020 and June 2020. 

On December 27, 2020, the Federal Appropriations Act was signed into law. While this is largely hailed as a COVID-19 relief package that served as a follow up to the Paycheck Protection Program, it did contain some changes to the Provider Relief Funds and the calculation of lost revenues. 

Providers received Phase 1 funds through automatic payments electronically deposited in their accounts based on 2019 Medicare fee-for-service payments. During Phase 1, providers had the option to apply for additional funds to supplement lost revenue, up to 2% of 2019 total collections by submitting additional practice information – including lost revenues. Providers could use a reasonable accounting methodology to calculate lost revenues where such methodologies included the difference between the provider’s 2020 budget and actual 2020 revenues or comparison of current revenues to previous revenues for the same time period. 

The definition of lost revenues was further revised in September 2020, steering away from a “reasonable accounting methodology” and moving towards a year-over-year analysis. And then finally settling on the definition contained in the November 2, 2020 guidance with a year-over-year analysis of revenues from patient care, but adding back in other assistance received in 2020. The guidance did not include any allowances for material changes in the provider’s business such as the addition or loss of providers, locations, or service lines. 

Through the new legislation, Congress appears to be sending a message back to HHS to revise the definition of lost revenues to allow providers to use a “reasonable accounting methodology” instead of a “one-size fits all” calculation. It will also be interesting to see whether HHS will exclude the additional assistance received in 2020 from the calculation.

HHS did update the FAQs on January 12, 2021 after the Federal Appropriations Act was passed, but these updates did not address the lost revenue calculations. So we anticipate that the portal will not open as anticipated and that additional changes will be forthcoming.  As a next step, providers should continue to be on the lookout for additional updates regarding the Provider Relief Funds. Providers should also continue to gather information related to expenses, revenues, and additional assistance received in 2020 in anticipation of reporting requirements. We can definitely count on one thing – CHANGE!   

If you have any questions, please contact BMD Healthcare and Hospital Law Member Amanda Waesch at alwaesch@bmdllc.com or 330-253-9185.

El Contrato Escrito: La Herramienta Predilecta

No existe mejor herramienta a una disputa contractual que un documento firmado por las partes en el cual se expongan las obligaciones y acuerdos entre éstas.

New State Budget Institutes Licensure Requirement for Ohio’s Hospitals

On July 1, 2021, Governor Mike DeWine signed Ohio’s final budget codified at Ohio Revised Code 3722.01 et seq., which includes a new licensing requirement for Ohio’s hospitals. For years, Ohio was the only state in the country that did not license its hospitals. This approach will now be replaced with new, detailed requirements that will require careful review and compliance. Here are some of the highlights concerning these new changes:

Healthcare Provisions in the Ohio FY 22-23 Budget

Governor Mike DeWine signed Ohio’s Fiscal Year 2022-2023 budget bill (HB 110) into law on July 1, 2021. At almost 1,000 pages and 74.1 billion dollars, the budget lays out the State’s spending for the next two years. Below are a few highlighted provisions from the budget that will be important for the healthcare industry in Ohio

Interim Final Rule for Surprise Billing

In an effort to implement the new bipartisan No Surprises Act, on July 1, 2021, the Department of Health and Human Services (HHS), along with the Departments of Labor and Treasury, issued an interim final rule to safeguard patients against unforeseen medical bills arising from out-of-network care.

President Biden Seeks to Limit Non-Compete Agreements

Today, President Biden announced he would issue an Executive Order that calls on the Federal Trade Commission (FTC) to adopt rules to curtail worker non-compete agreements. Interestingly, a week ago, the FTC approved changes to its Rules of Practice to modernize and expedite the way it issues Trade Regulation Rules. If you have followed our alerts, we predicted the elimination of non-competes would probably happen. In 2016, then-Vice President Biden was a vocal opponent against non-compete agreements. He led the Obama administration’s initiative seeking to limit or eliminate non-compete agreements. In his presidential campaign, Biden promised to “work with Congress to eliminate all non-compete agreements, except the very few that are absolutely necessary to protect a narrowly defined category of trade secrets . . ..”