New Provider Relief Funding Announced, Providers Should Apply ASAP and by November 6

Providers, including assisted living facilities, behavioral health providers, and certain previously ineligible healthcare providers, will be able to apply for a new phase of Provider Relief Funding (“Funding”) beginning October 5, 2020.  The new Phase 3 Funding, announced on October 1, 2020, is the latest in a series of tranches (and sub-tranches) of funding from the Department of Health & Human Services (“HHS”).  HHS has made $20 billion available through this tranche.

HHS appears to be targeting health providers that have not yet received Funding in the amount of 2% of annual revenues from patient care.  However, Phase 3 Funding is available more broadly, even for certain providers that already received 2% of patient revenues.  HHS has outlined the following eligibility categories:

• Providers who previously received, rejected or accepted a General Distribution Provider Relief Fund payment. Providers that have already received payments of approximately 2% of annual revenue from patient care may submit more information to become eligible for an additional payment.
• Behavioral Health providers, including those that previously received funding and new providers.
• Healthcare providers that began practicing January 1, 2020 through March 31, 2020. This includes Medicare, Medicaid, CHIP, dentists, assisted living facilities and behavioral health providers.

HHS has also outlined criteria it will look for in determining additional payments:

1. 1. All provider submissions will be reviewed to confirm they have received a Provider Relief Fund payment equal to approximately 2 percent of patient care revenue from prior general distributions. As mentioned above, the indication is that applicants that have not yet received Relief Fund payments of 2 percent of patient revenue will receive a payment that, when combined with prior payments (if any), equals 2 percent of patient care revenue.

1. 2. With the remaining balance of the $20 billion budget, the Health Resources and Services Administration will then calculate an equitable add-on payment that considers the following:
   • A provider’s change in operating revenues from patient care
   • A provider’s change in operating expenses from patient care, including expenses incurred related to coronavirus
   • Payments already received through prior Provider Relief Fund distributions.

While terms and conditions and other documents are not yet available, Phase 3 Funding recipients will very likely be subject to auditing to ensure the accuracy of the data submitted to HHS for payment.  Additionally, recipients may not use the payment to reimburse expenses or losses that have been reimbursed from other sources or that other sources are obligated to reimburse, such as the Paycheck Protection Program.

In its press release, HHS included the following regarding the funding opportunity:

HHS has worked to ensure that all American healthcare providers receive support from the Provider Relief Fund in a fast and fair way, and this new round helps ensure that we are reaching America’s essential behavioral health providers and takes into account losses and expenses relating to coronavirus . . . We’ve worked with all of the resources we have across HHS to ensure that America’s heroic healthcare providers know they can apply for support.

Providers planning to submit an application for funding currently have a deadline of November 6, 2020.  The portal for submission will open on October 5, 2020 and will likely be accessible here.

For more information, please contact Hedy S. Rubinger or Alexander B.  Foster.