Welcome Relief for Medicaid Providers, but Action Required by July 3, 2020

Provider relief funds have been distributed primarily to Medicare-certified programs to date.  Medicaid providers that do not participate in Medicare are bearing most if not all of the same expenses and losses as Medicare providers.  For example, assisted living and residential care providers have adjusted operations significantly since the COVID-19 outbreak in order to prevent the infection and/or spread of the disease within the vulnerable populations residing at the facilities.  The lack of federal funding to Medicaid-only providers appears to be changing.  Whereas HHS has been distributing relief funds to Medicare providers automatically, HHS seems to be requiring that Medicaid providers put in some work before funds are distributed.

HHS announced on June 9, 2020 that it expects to distribute funding from a $15 billion allocation to eligible providers that participate in state Medicaid programs.  HHS Secretary Alex Azar explained “Healthcare providers who focus on treating the most vulnerable Americans, including low-income and minority patients, are absolutely essential to our fight against COVID-19 . . . HHS is using funds from Congress, secured by President Trump, to provide new targeted help for America’s safety-net providers and clinicians who treat millions of Medicaid beneficiaries.”  To be eligible for this funding, health care providers must not have received payments from the $50 billion Provider Relief Fund General Distribution and either have directly billed their state Medicaid programs or Medicaid managed care plans for healthcare-related services between January 1, 2018 and  May 31, 2020.  Providers remain eligible for Medicaid Relief Funds even if they received Targeted Distribution Funds such as funds directed to skilled nursing facilities as long as they did not receive General Distribution Funds. Specific criteria are delineated in the newly published FAQs.

Note that funding is not automatic.  Providers must submit an application for funding as explained in the FAQs.  The deadline to submit an application for the Medicaid Targeted Distribution is July 3, 2020.  To that end, HHS simultaneously announced that on Wednesday, June 10, 2020, it will be launching an “enhanced Provider Relief Fund Payment Portal” that will allow eligible Medicaid providers to report their annual patient revenue, which will be used as a factor in determining their Relief Fund payment. According to HHS, “[t]he payment to each provider will be at least 2 percent of reported gross revenue from patient care; the final amount each provider receives will be determined after the data is submitted, including information about the number of Medicaid patients providers serve.”

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

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