The State of Illinois is set to administer additional HFS funding to Nursing homes for July, August, and September 2021. the payment will be approximately $25 million per month. Illinois SNF providers may expect to receive the first and second payment in August. The calculation of the payment will be based on CMS’s Q4 2020 (7/1/2020 – 9/30/2020) PBJ submissions.

The percentages of payments that have to be allocated to staff is as follows

July – 50%

August – 62.5%

September – 75%

The remaining funds will need to be used to support said staff i.e. infection control costs, PPE Costs, etc. July and August payments will be received automatically by all providers. As for September the lowest staffed 1/3 of providers in Illinois will need to provide documentation proving that the funds were properly utilized in July and August to be eligible for September payment. The upper 2/3s of providers will receive September automatically. As with previous distributions from HFS, providers will be required to report on the use of funds. Failure to provide their report will result in owing the funds back to the State.

How can a provider return unused Provider Relief Fund payments that it has partially spent? (Added 7/15/2021)

Providers that have remaining Provider Relief Fund payments that they cannot expend on allowable expenses or lost revenues attributable to coronavirus by the relevant deadline to use funds are required to return this money to the federal government. To return any unused funds, use the Return Unused PRF Funds Portal. Instructions for returning any unused funds are available at: Last updated: 7/15/2021  https://na3.docusign.net/Member/PowerFormSigning.aspx?PowerFormId=45c01db6-78db-403abaa3-480c1950f596&env=na3&acct=dd54316c-1c18-48c9-8864-0c38b91a6291&v=2. The Provider Relief Fund Terms and Conditions and applicable laws authorize HHS to audit Provider Relief Fund recipients now or in the future to ensure that program requirements are/were met. HHS is authorized to recoup any Provider Relief Fund payment amounts that were made in error, exceed lost revenue or expenses due to coronavirus, or in cases of noncompliance with the Terms and Conditions.

 

When should Provider Relief Fund expenditures and/or lost revenue be reported on a nonfederal entity’s Schedule of Expenditures of Federal Awards (SEFA)? (Added 7/15/2021)

Non-federal entities will include Provider Relief Fund expenditures and/or lost revenues on their SEFAs for fiscal year ends (FYEs) ending on or after June 30, 2021. Please refer to the 2021 OMB Compliance Supplement for additional information.

 

How will a non-federal entity determine the amount of expenditures and/or lost revenues to report on its SEFA for FYEs ending on or after June 30, 2021? (Added 7/15/2021)

A non-federal entity’s SEFA reporting is linked to its report submissions to the Provider Relief Fund Reporting Portal. Therefore, the timing of SEFA reporting of Provider Relief Fund payments will be as follows:

• For a FYE of June 30, 2021, and through FYEs of December 30, 2021, recipients are to report on the SEFA, the total expenditures and/or lost revenues from the Period 1 report submission to the Provider Relief Fund Reporting Portal.

• For a FYE of December 31, 2021, and through FYEs of June 29, 2022, recipients are to report on the SEFA, the total expenditures and/or lost revenues from both the Period 1 and Period 2 report submissions to the PRF reporting porta Provider Relief Fund Reporting Portal l.

• For FYEs on or after June 30, 2022, SEFA reporting guidance related to Period 3 and Period 4 will be provided at a later date.

 

When reporting on lost revenues, how should Reporting Entities treat “contractual adjustments from all third party payers” and “charity care adjustments” when determining what to exclude from patient care-related revenue sources? (Added 7/15/2021)

Reporting Entities should exclude the amount of contractual adjustments from all third party payers and charity care adjustments, as applicable, when determining patient care-related revenue sources.

 

How do I appeal or dispute a decision made? (Added 7/15/2021)

HHS recognizes that providers may have questions regarding the accuracy of their PRF payments. HHS is developing a structured reconsiderations process to review and reconsider payment accuracy based on submitted supporting documentation. Details regarding this process will be provided in coming weeks.

An organization that sold part of a practice in 2019 or January 2020 received a payment under Phase 1 of the General Distribution that reflected the 2019 Medicare fee-for-service billing of the part of the practice that was sold. Can the parent entity return a portion of the payment for the part of the practice it no longer owns? (Modified 7/1/2021)

If a provider has unused funds, it may return all or a portion of the funds when the first reporting period begins. If a provider that sold a practice that was included in its most recent tax return gross receipts or sales (or program services revenue) figure can attest to meeting the Terms and Conditions, it may accept the funds. The Terms and Conditions place restrictions on how the funds can be used. In particular, all recipients will be required to substantiate that these funds were used for health care-related expenses or lost revenues attributable to coronavirus, and that those expenses or losses were not reimbursed from other sources and other sources were not obligated to reimburse them.

 

Can an organization that received a Provider Relief Fund payment and provided care on or after January 31, 2020 that sold, terminated, transferred, or otherwise disposed of a provider accept the payment (received via ACH or check) associated with the sold provider? (Modified 7/1/2021)

If an organization that sold, terminated, transferred, or otherwise disposed of a provider that was included in its most recent tax return gross receipts or sales (or program services revenue) figure can attest to meeting the Terms and Conditions, it may accept the funds. The Terms and Conditions place restrictions on how the funds can be used. In particular, all recipients will be required to substantiate that these funds were used for health care-related expenses or lost revenues attributable to coronavirus up to the date of the sale, and that those expenses or losses were not reimbursed from other sources and other sources were not obligated to reimburse them

 

If, as a result of the sale of a practice/hospital, the TIN that received a Provider Relief Fund payment is no longer providing health care services as of January 31, 2020, is it required to return the payment? (Modified 7/1/2021)

Yes. If, as a result of the sale of a practice/hospital, the TIN that received a Provider Relief Fund payment did not provide diagnoses, testing, or care for individuals with possible or actual cases of COVID-19 on or after January 31, 2020, the provider must reject the payment. The Provider Relief Fund Payment Attestation Portal guides providers through the attestation process to reject the attestation and return the payment to HRSA.

 

Can a provider that purchased a TIN in 2019, 2020, or 2021 accept a Provider Relief Fund payment from a previous owner and complete the attestation for the Terms and Conditions? (Modified 7/1/2021)

No. The new TIN owner cannot accept the payment directly from another entity nor attest to the Terms and Conditions on behalf of the previous owner in order to retain the Provider Relief Fund payment, including payment under the Nursing Home Infection Control Quality Incentive Payment Program. However, the new TIN owner may still otherwise apply for and/or receive funds.

 

Can providers allocate parent overhead costs to the entities that received Provider Relief Funds? (Modified 7/1/2021)

Yes, providers that already have a cost allocation methodology in place at the time they received funds, may allocate normal and reasonable overhead costs to their subsidiaries, which may be an eligible expense if attributable to coronavirus and not reimbursed from other sources.

 

How does a Reporting Entity determine whether an expense is eligible for reimbursement through the Provider Relief Fund? (Modified 7/1/2021)

To be considered an allowable expense under the Provider Relief Fund, the expense must be used to prevent, prepare for, and respond to coronavirus. Provider Relief Fund payments may also be used for lost revenues attributable to the coronavirus. Reporting Entities are required to maintain adequate documentation to substantiate that these funds were used for health carerelated expenses or lost revenues attributable to coronavirus, and that those expenses or losses were not reimbursed from other sources and other sources were not obligated to reimburse them.

Reporting Entities are not required to submit that documentation when reporting. Providers are required to maintain supporting documentation which demonstrates that costs were obligated/incurred during the period of availability. The burden of proof is on the Reporting Entity to ensure that adequate documentation is maintained.

 

What is the maximum allotment of my organization’s Provider Relief Fund amount that can be allocated to lost revenues during the period of availability of funds? (Modified 7/1/2021)

There is not a maximum or minimum that can be allocated. Reporting Entities will see the reporting system asks for unreimbursed expenses attributable to coronavirus first in the overall use of funds calculation; it is possible for a Reporting Entity to enter “0”. Provider Relief Fund payment amounts not fully expended on unreimbursed health care-related expenses attributable to coronavirus during the period of availability are then applied to lost revenues. Lost revenues or expenses must only have been incurred during the period of availability correlating to the Payment Received Date as described in the June 11 Post-Payment Notice of Reporting Requirements.

 

For Option i and Option ii, lost revenues are calculated for each quarter during the period of availability, as a standalone calculation, with 2019 quarters serving as a baseline. For each calendar year of reporting, the applicable quarters where lost revenues are demonstrated are totaled to determine an annual lost revenues amount. There is no offset. Option iii provides maximum flexibility to providers by allowing providers to calculate lost revenues using an alternate reasonable methodology.

 

Can recipients use 2020 budgeted revenues as a basis for reporting lost revenues? (Modified 7/1/2021)

Yes. When reporting use of Provider Relief Fund payments toward lost revenues attributable to coronavirus, Reporting Entities may use budgeted revenues if the budget(s) and associated documents covering calendar year 2020 were established and approved prior to March 27, 2020. To be considered an approved budget, the budget must have been ratified, certified, or adopted by the Reporting Entity’s financial executive, executive officer or other responsible representative as of that date, and the Reporting Entity will be required to attest that the budget was established and approved prior to March 27, 2020. Documents related to the budget, including the approval, must be maintained in accordance with the Terms and Conditions

 

What are the categories for patient metrics? (Modified 7/1/2021)

Patient metric categories include a) inpatient admissions; b) outpatient visits (in-person and virtual); c) emergency department visits; and d) facility stays (for long-term and short-term residential facilities). The definitions are included below. a) Inpatient Admissions: number of hospital admissions on a clinician’s order (i.e., direct admit) or formally admitted from the emergency department to the hospital (i.e., emergency admission). b) Outpatient Visits: number of in-person or virtual patient encounters with a clinician in an office-based, clinic, or hospital outpatient department setting that do not require an inpatient admission. c) Emergency Department Visit: number of emergency department encounters for care or treatment. This may include patients on observation status who are cared for no longer than 72 hours but not formally admitted to a hospital. d) Facility Stays: number of stays (defined as unique admissions) for patients residing in a long-term or short-term care or treatment facility. A comprehensive user guide with definitions will be made available when the first reporting period begins.

 

Providers may have significant fluctuations in year-over-year net patient revenues due to settlements or payments made to third parties relating to care delivered outside the reporting period (2019-2021). Should Provider Relief Fund recipients exclude from the reporting of net patient revenue payments received for care not provided in 2019, 2020, or 2021? (Modified 7/1/2021)

Provider Relief Fund recipients shall exclude from the reporting of net patient revenue payments received or payments made to third parties relating to care not provided in 2019, 2020, or 2021.

 

If a provider cannot expend its Provider Relief Fund payment by the applicable deadline to use funds, what is the deadline to return the unused funds to the government? (Added 7/1/2021)

The provider must return any unused funds to the government within 30 calendar days after the end of the applicable Period of Reporting.

 

Must Federally Qualified Health Centers (FQHCs) and FQHC Look-Alikes fully draw down COVID-19 supplemental grant awards before using Provider Relief Fund payments for eligible expenses and lost revenues attributable to coronavirus? (Added 7/1/2021)

Grant funds awarded to FQHCs and FQHC Look-Alikes for costs for expenses or losses that are potentially eligible for payments under the Provider Relief Fund would need to be utilized until fully drawn down before Provider Relief Fund payments could be used during the applicable period of availability. The Provider Relief Fund requires that funds not be used to reimburse expenses or losses that have been reimbursed from other sources or that other sources are obligated to reimburse. If FQHCs or FQHC Look-alikes have incurred expenses or losses attributable to coronavirus that these grant awards do not cover, they may use Provider Relief Fund payments towards those expenses or losses

 

If rent or mortgages were paid during the applicable period of availability but staff worked remotely, could those expenses be claimed as eligible expenses? (Added 7/1/2021)

Health care-related operating expenses are limited to costs incurred to prevent, prepare for, and respond to coronavirus. The amount of mortgage or rent eligible for Provider Relief Fund reimbursement is limited to that which was incurred to prevent, prepare for, and respond to coronavirus. Providers are required to maintain documents to substantiate that these funds were used for health care-related expenses attributable to coronavirus, and that those expenses or losses were not reimbursed from other sources and other sources were not obligated to reimburse them. The burden of proof is on the provider to ensure that documentation is maintained to show that expenses are to prevent, prepare for, and respond to coronavirus.

 

If a Reporting Entity anticipates that it will receive coronavirus-related assistance, such as from FEMA, but that assistance has not yet been received, should that be accounted for in its Provider Relief Fund reporting? (Added 7/1/2021)

Provider Relief Fund payments may be applied to expenses or lost revenues attributable to coronavirus, after netting the other funds received or obligated to be received which offset those expenses. If a provider has submitted an application to FEMA, but has not yet received the FEMA funds, the provider should not report the requested FEMA amounts in the Provider Relief Fund report. If FEMA funds are received during the same Payment Received Period in which provider is reporting on use of Provider Relief Fund payments, the receipt and application of each payment type is required in the Provider Relief Fund reporting process. If an entity receives a retroactive payment from FEMA that overlaps with the period of availability, the entity must not use the FEMA payment on expenses or lost revenues already reimbursed by Provider Relief Fund payments.

 

Must the Reporting Entity be in receipt of purchases made using Provider Relief Fund Payments in order for the expense to be considered eligible for reimbursement? (Added 7/1/2021)

No. For purchases of tangible items made using Provider Relief Fund payments, the purchase does not need to be in the Reporting Entity’s possession (i.e., backordered personal protective equipment, capital equipment) to be considered an eligible expense. However, the costs must be incurred before the Deadline to Use Funds. Providers must follow their basis of accounting (e.g., cash, accrual, or modified accrual) to determine expenses.

 

How will HRSA use “Other Assistance Received” when calculating expenses or lost revenues? (Added 7/1/2021/)

The Other Assistance Received reported to HRSA will not be used in the calculation of expenses or lost revenues. Reporting Entities are expected to make a determination of their expenses applied to Provider Relief Fund payments after considering “Other Assistance Received” and taking into account that Provider Relief Fund payments may not be used for expenses or lost revenues that other sources have reimbursed or that other sources are obligated to reimburse.

 

How will HRSA use the net unreimbursed expenses attributable to coronavirus in the calculation of expenses or lost revenues? (Added 7/1/2021/)

The net unreimbursed expenses attributable to coronavirus reported to HRSA will not be used in the calculation of expenses or lost revenues. Reporting Entities are expected to determine their net unreimbursed expenses attributable to coronavirus after taking into consideration the application of Other Assistance Received and all Provider Relief fund payments. HRSA expects that Provider Relief Fund payments would be applied to unreimbursed expenses attributable to coronavirus that are not obligated to be reimbursed by other sources before Provider Relief Fund payments are used for lost revenues. Reporting Entities will see the reporting system asks for unreimbursed expenses attributable to coronavirus first in the overall use of funds calculation; it is possible for a Reporting Entity to enter “0”.

 

Will patient care revenue be counted against a Reporting Entity twice if the entity reported in “Other Assistance Received” and in the “Patient Care/Lost Revenue” sections of the Reporting Portal? (Added 7/1/2021/

Patient care revenue should not be reported as part of “Other Assistance Received” as it is a source of revenue, not a source of other assistance as defined by Provider Relief Fund reporting requirements. The “Other Assistance Received” reported to HRSA will not be used in the calculation of expenses applied to Provider Relief Fund payments or lost revenues.

 

If a Reporting Entity has more lost revenue for a “Payment Received Period” than it received Provider Relief Fund payments for the same period, can that lost revenue be carried forward and applied against payments received during later “Payment Received Periods” and included in the lost revenues reported during later reporting periods? (Added 7/1/2021/

Yes. Provider Relief Fund payments may be applied to expenses and lost revenues according to the period of availability of funding. However, expenses and lost revenues may not be duplicated. Specifically, payments received may not be applied to the same expenses and lost revenues that Provider Relief Fund payments received in prior payment periods already reimbursed. The Payment Received Periods described in the June 11, 2021 Post-Payment Notice of Reporting Requirements determine the period of availability of funding and when reports are due.

 

Reporting Entities have varying fiscal year ends (e.g., June 30, September 30, or December 31). How should providers report lost revenues if their fiscal year does not align with the calendar year? (Added 7/1/2021/)

All Reporting Entities that opt to report lost revenues using Option i (Comparison of Actual Revenue) or Option ii (Comparison of Budgeted Revenue to Actual Revenue) must enter their patient care revenue for each quarter within the entire period of availability. Reporting Entities using Option iii must enter their lost revenues, calculated by any reasonable method, for each quarter during the period of availability.

 

How will HRSA calculate lost revenues for providers that select Option i (Comparison of Actual Lost Revenues) or Option ii (Comparison of Budgeted to Actual Lost Revenues) at the time of reporting? (Added 7/1/2021/

For Option i and Option ii, lost revenues are calculated for each quarter during the period of availability, as a standalone calculation, with 2019 quarters serving as a baseline. For each calendar year of reporting, the applicable quarters where lost revenues are demonstrated are totaled to determine an annual lost revenues amount. The annual lost revenues are then added together.

 

What is the baseline comparison period for providers that report on patient care revenue using Option i (Comparison of Actual Lost Revenues) or Option ii (Comparison of Budgeted to Actual Lost Revenues)? (Added 7/1/2021/)

Quarters from 2019 will serve as the baseline period of comparison.

 

If a Reporting Entity experienced quarterly patient care revenue losses during some, but not all, of the quarters during the period of availability of funds, may Provider Relief Fund payments be used to cover losses during those quarters only? (Added 7/1/2021/)

Yes, lost revenues are calculated for each quarter during the period of availability, as a standalone calculation. Provider Relief Fund payments may be used to cover those quarters where patient care revenue losses occurred as long as those losses were attributable to coronavirus.

 

Are providers able to request extensions on submissions of their required reports for any of the required reporting periods? (Added 7/1/2021)

No. Providers that received one or more payments exceeding $10,000, in the aggregate, during a Payment Received Period are required to report in each applicable Reporting Time Period. Providers that are required to report and do not submit a completed report by the applicable deadlines will be deemed out of compliance with the program Terms and Conditions and may be subject to recoupment.

 

Are providers able to request extensions on the deadline to use funds? (Added 7/1/2021)

No. HRSA will not approve extensions on the use of funds for any providers. Any unused funds must be returned to the government following the relevant Reporting Time Period.

 

How will a Reporting Entity know if HRSA determines if its revenue estimation approach is considered reasonable? (Added 7/1/2021)

HRSA will notify a Reporting Entity if their proposed methodology is not reasonable, including if it does not demonstrate with a reasonable certainty that claimed lost revenues were caused by coronavirus. If HRSA determines that a Reporting Entity’s proposed alternate methodology is not reasonable, the entity will be asked to resubmit its report within 30 days of notification using either Option i or Option ii to calculate lost revenues attributable to coronavirus.

Is there a set period of time in which providers must use the funds to cover allowable expenses or lost revenues attributable to COVID-19? (Modified 6/11/2021)

Yes. Provider Relief Fund recipients must only use payments for eligible expenses, including services rendered, and lost revenues attributable to coronavirus before the deadline that corresponds to the Payment Received Period, which is based on the date the payment is received. Funds will be available for at least 12 months and a maximum of 18 months. The payment is considered received on the deposit date for automated clearing house (ACH) payments or the check cashed date.

 

Period	Payment Received Period	Deadline to Use Funds
Period 1	April 10, 2020 to June 30, 2020	June 30, 2021
Period 2	July 1, 2020 to December 31, 2020	December 31, 2021
Period 3	January 1, 2021 to June 30, 2021	June 30, 2022
Period 4	July 1, 2021 to December 31, 2021	December 31, 2022

 

Providers must follow their basis of accounting (e.g., cash, accrual, or modified accrual) to determine expenses.

 

Recipients may use payments for eligible expenses incurred prior to receipt of those payments (i.e., pre-award costs) so long as they are to prevent, prepare for, and respond to coronavirus. However, HHS expects that it would be highly unusual for providers to have incurred eligible expenses prior to January 1, 2020.  All recipients are subject to audit.

HHS reserves the right to audit Provider Relief Fund recipients now or in the future, and is authorized to collect any Provider Relief Fund amounts that have not been supported by documented expenses or losses attributable to coronavirus or not used in a manner consistent with program requirements or applicable law. All payment recipients must attest to the Terms and Conditions, which require the submission of documentation to substantiate that these funds were used for health care-related expenses or lost revenues attributable to coronavirus.

In order to accept a payment, must the provider have already incurred eligible expenses and losses higher than the Provider Relief Fund payment received? (Modified 6/11/2021) No. Providers do not need to be able to prove that prior and/or future lost revenues and expenses attributable to COVID-19 (excluding those covered by other sources of reimbursement) meet or exceed their Provider Relief Fund payment at the time they accept such a payment. Providers must report on the use of Provider Relief Fund payments in accordance with legal and program requirements in the relevant Reporting Time Period. Recipients may use payments for eligible expenses incurred prior to receipt of those payments (i.e., pre-award costs) so long as they are to prevent, prepare for, and respond to coronavirus. Providers must follow their basis of accounting to determine expenses.  Duplication of expenses and lost revenues is not permitted. All recipients are subject to audit.

What should providers do if they have remaining Provider Relief Fund money that they cannot expend on permissible expenses or losses by the relevant deadline? (Added 6/11/2021)

Providers that have remaining Provider Relief Fund money that they cannot expend on permissible expenses or losses by the relevant deadline will return this money to HHS. Deadlines to use funds correspond to the date they received payment, as outlined in the Post-Payment Notice of Reporting Requirements. . The Provider Relief Fund Terms and Conditions and legal requirements authorize HHS to audit Provider Relief Fund recipients now or in the future to ensure that program requirements are met. HHS is authorized to recoup any Provider Relief Fund amounts that were made in error or exceed lost revenue or expenses due to COVID-19, or in cases of noncompliance with the Terms and Conditions.

Will HHS release separate requirements for recipients of the Skilled Nursing Facility (SNF) and Nursing Home Infection Control Distribution payments? (Added 6/11/2021)

No. HHS included requirements on how recipients of the SNF and Nursing Home Infection Control Distribution payments will report on these funds in the June 2021 Post-Payment Notice of Reporting Requirements. Recipients of this funding will be able to submit a consolidated report that distinguishes use of SNF and Nursing Home Infection Control Distribution funds from use of other General and Targeted Distribution payments.

How does a Reporting Entity determine whether an expense is eligible for reimbursement through the Provider Relief Fund? (Added 6/11/2021)

To be considered an allowable expense under the Provider Relief Fund, the expense must be used to prevent, prepare for, and respond to coronavirus. Provider Relief Fund payments may also be used for lost revenues attributable to the coronavirus. Reporting Entities are required to maintain adequate documentation to substantiate that these funds were used for health care- related expenses or lost revenues attributable to coronavirus, and that those expenses or losses were not reimbursed from other sources and other sources were not obligated to reimburse them. The burden of proof is on the Reporting Entity to ensure that adequate documentation is maintained.

Will HHS provide guidance to certified public accountants and those organizations that providers will rely on to perform audits? (Modified 6/11/2021)

The only guidance HHS provides to auditors is through the Office of Management and Budget Compliance Supplement. Non-Federal Entities subject to Single Audit requirements can find guidance in the 2020 Compliance Supplement Addendum, which is available at https://www.whitehouse.gov/wp-content/uploads/2020/12/2020-Compliance-Supplement- Addendum_Final.pdf and in the forthcoming 2021 Compliance Supplement. The applicable Assistance Listings numbers include 93.498 [Provider Relief Fund] and 93.461 [HRSA COVID- 19 Uninsured Program].

Are Provider Relief Fund payments to commercial (for-profit) organizations subject to Single Audit in conformance with the requirements under 45 CFR 75 Subpart F? (Modified 6/11/2021)

Commercial organizations that expend $750,000 or more in annual awards have two options under 45 CFR 75.216(d) and 75.501(i): 1) a financial related audit of the award or awards conducted in accordance with Generally Accepted Government Auditing Standards; or 2) an audit in conformance with the requirements of 45 CFR 75.514 (Single Audit).

Provider Relief Fund General and Targeted Distribution payments (93.498) and Uninsured Testing, Treatment, and Vaccine Administration reimbursement payments (93.461) must be included in determining whether an audit in accordance with 45 CFR Subpart F is required (i.e.,

Audit reports of commercial organizations must be submitted via email to HRSA’s Division of Financial Integrity at PRFaudits@hrsa.gov.

How do I determine if expenses should be considered “expenses attributable to coronavirus not reimbursed by other sources?” (Modified 6/11/2021)

Expenses attributable to coronavirus may include items such as supplies, equipment, information technology, facilities, personnel, and other health care-related costs/expenses for the period of availability. The classification of items into categories should align with how Provider Relief Fund payment recipients maintain their records. Providers can identify their expenses attributable to coronavirus, and then offset any amounts received through other sources, such as direct patient billing, commercial insurance, Medicare/Medicaid/Children’s Health Insurance Program (CHIP); other funds received from the federal government, including the Federal Emergency Management Agency (FEMA); the Provider Relief Fund COVID-19 Claims Reimbursement to Health Care Providers and Facilities for Testing, Treatment, and Vaccine Administration for the Uninsured (Uninsured Program);the COVID-19 Coverage Assistance Fund (CAF); and the Small Business Administration (SBA) and Department of the Treasury’s Paycheck Protection Program (PPP). Provider Relief Fund payments may be applied to the remaining expenses or costs, after netting the other funds received or obligated to be received which offset those expenses. The Provider Relief Fund permits reimbursement of marginal increased expenses related to coronavirus provided those expenses have not been reimbursed from other sources or that other sources are not obligated to reimburse

What documentation is required for reporting? (Modified 6/11/2021)

Supporting worksheets will be available to assist Reporting Entities with completion of reports. In addition, Reporting Entities who are using a portion of their funds for lost revenues may be required to upload supporting documentation when reporting on their calculation of lost revenues. The documentation required is dependent upon which method of calculating lost revenues providers select. Please review the most recently published Post-Payment Notice of Reporting Requirements for additional details.

Who is responsible for reporting use-of-funds in the event of a change of ownership after receipt of a Provider Relief Fund payment? (Modified 6/11/2021)

In the case of a change in ownership after receipt of a Provider Relief Fund payment, the responsibility for reporting in the Provider Relief Fund Reporting Portal is dependent on whether funds were from the General or Targeted Distribution.

For General Distribution payments: A parent entity may report on its subsidiaries’ General Distribution payments regardless of whether the subsidiary TINs received the General Distribution payments directly or whether General Distribution payments were transferred to them by the parent entity. The parent entity may report on these General Distribution payments regardless of whether the parent or the subsidiary attested to the Terms and Conditions.

For Targeted Distribution payments: The original recipient of a Targeted Distribution payment is always the Reporting Entity. A parent entity may not report on its subsidiaries’ Targeted Distribution payments as part of its consolidated report. The original recipient of a Targeted Distribution must report on the use of funds in accordance with the Coronavirus Response and Relief Supplemental Appropriations (CRRSA) Act. This is required regardless of whether the parent or subsidiary received the payment or whether that original recipient subsequently transferred the payment. A Reporting Entity that is a subsidiary must indicate the payment amount of any of the Targeted Distributions it received that were transferred to/by the parent entity, if applicable.

What are the categories for classifying personnel? (Modified 6/11/2021)

Personnel will be classified as either “clinical” or “non-clinical” staff using the following categories: a) full-time; b) part-time; c) contractor; d) furloughed; e) separated; and f) hired.

1. Full-time: number of personnel employed on average 30 hours of service per week, or 130 hours for a calendar
2. Part-time: number of personnel employed any time between 1 and 34 hours per week, whom may or may not qualify for benefits.
3. Contractor: number of personnel employed as an individual or under organizational contracts and do not receive direct benefits or compensation from the Reporting
4. Furloughed: number of personnel on involuntary and unpaid leave of
5. Separated: number of personnel who 1) voluntarily submitted a written or verbal notice of resignation or 2) the Reporting Entity decided to terminate its relationship with the employee(s) (includes lay-offs and expired contracts).
6. Hired: number of personnel 1) not previously employed by the Reporting Entity or 2) that left a company due to voluntary or involuntary separation and are brought back to work by employer.

What are the categories for patient admission? (Modified 6/11/2021)

Patient metric categories include a) inpatient admissions; b) outpatient admissions visits (in- person and virtual); c) emergency department visits; and d) facility stays (for long-term and short-term residential facilities). The definitions are included below.

1. Inpatient Admissions: number of hospital admissions on a clinician’s order (i.e., direct admit) or formally admitted from the emergency department to the hospital (i.e., emergency admission).
2. Outpatient Visits: number of in-person or virtual patient encounters with a clinician in an office-based, clinic, or hospital outpatient department setting that do not require an inpatient
3. Emergency Visit: number of emergency department encounters for care or treatment. This may include patients on observation status who are cared for no longer than 72 hours but not formally admitted to a
4. Facility Stays: number of stays (defined as unique admissions) for patients residing in a long-term or short-term care or treatment facility.

A comprehensive user guide with definitions will be made available when the first reporting period begins.

What is considered a “staffed bed” for reporting facility metrics? (Modified 6/11/2021) A staffed bed is licensed and physically available with staff on hand to attend to patients; includes both occupied and available beds.

Who is required to report when the portal opens? (Added 6/11/2021)

A Reporting Entity must report only when they have retained over $10,000 in aggregated Provider Relief Fund payments received during a single Payment Received Period.

What are the required timelines for reporting? (Modified 6/11/2021)

Provider Relief Fund recipients are required to report in each Payment Received Period in which they received one or more payments exceeding, in the aggregate, $10,000, as indicated in the table below. Reporting must be completed and submitted to HRSA by the last date of the relevant Reporting Time Period. Provider Relief Fund recipients that do not report within the respective Reporting Time Period are out of compliance with payment Terms and Conditions and funds may be subject to recoupment.

 

Period	Payment Received Period (Payments Exceeding $10,000 in Aggregate Received)	Reporting Time Period
Period 1	April 10, 2020 to June 30, 2020	July 1, 2021 to September 30, 2021
Period 2	July 1, 2020 to December 31, 2020	January 1, 2022 to March 31, 2022
Period 3	January 1, 2021 to June 30, 2021	July 1, 2022 to September 30, 2022
Period 4	July 1, 2021 to December 31, 2021	January 1, 2023 to March 31, 2023

If an entity received payments totaling over $10,000, but returned some, do they still have to report? (Modified 6/11/2021)

A Reporting Entity must report only when they have retained over $10,000 in aggregated Provider Relief Fund payments received during a single calendar year.

What is the process to return unused funds? (Modified 6/11/2021)

When the first reporting period begins, providers will be able to return unused funds through the Reporting Portal.

Are providers that received payments under Phase 3 of the General Distribution limited to using these funds to cover coronavirus-related losses or expenses experienced during the first two quarters of calendar year 2020?  (Modified 6/11/2021)

No. The Terms and Conditions require payment recipients to certify that funds will only be used to prevent, prepare for, and respond to coronavirus, and will only reimburse the recipient for health care-related expenses or lost revenues that are attributable to coronavirus. While HHS collected information on the losses and expenses associated with the first two quarters of 2020 for the purposes of making additional General Distribution payments to those providers with demonstrated financial need, the Terms and Conditions do not place limits on which quarters these funds must be applied to cover eligible losses or expenses.

 

Illinois lawmakers are looking to increase assessment fees paid by nursing homes in order to fund a proposed law that aims to change the way providers are reimbursed in a push to reduce understaffing and reduce overcrowding in facilities.

The legislative proposal was introduced last week in the state’s General Assembly. Lawmakers hope to pass the bill before the end of May, the Chicago Tribune reported.

Under the bill, the state would change its reimbursement formula to be based on the Patient Driven Payment Model rather than the number of services performed. It also would end payments for rooms with three or more roommates, according to the report. The bill also proposes increasing reimbursement to providers that hire more nurses and aides.

The Health Care Council of Illinois described the legislation as a “dramatic policy that would significantly disrupt care.” It has called for an alternative measure that includes establishing a one-time payment per bed to help facilities recover from the pandemic, a guaranteed rate floor for managed care and increasing the nursing home bed tax to the federal minimum. The additional funding could go toward staffing, recruitment and wages, the group said.

“The fact is we share the same values and goals [the Department of Healthcare and Family Services] does in enhancing care, improving infection control and increasing staffing, but now is not the time to introduce dramatic policy changes that would significantly disrupt the delivery of care while the pandemic is still active,” Matt Pickering, the group’s executive director, said in a statement.

Currently, Illinois spends about $2.5 billion for nursing home care, with Medicaid covering about 60% of those costs.

Per the MLN Matters Article below dated April 1, 2021, CMS informs all Medicare providers and suppliers who requested and received COVID-19 Accelerated and Advance Payments (CAAPs) that the MACs began recovering those payments as early as March 30, 2021, depending upon the 1 year anniversary of when a provider received their first payment. It also gives information on how to identify recovered payments. Please be sure your billing staff are aware that the recovery has begun, or will begin soon but no sooner than 1 year from the date CMS issued the CAAP to you.

BACKGROUND

Section 3719 of the Coronavirus Aid, Relief, and Economic Security (CARES) Act expanded the existing Accelerated Payments Program to give additional flexibilities during the PHE. This included extending repayment timeframes for inpatient hospitals, children’s hospitals, certain cancer hospitals, and critical access hospitals.

Title V (Section 2501) of the Continuing Appropriations Act, 2021 and Other Extensions Act, enacted on October 1, 2020, amended the CAAP repayment terms for all providers and suppliers who requested and received CAAPs during the COVID-19 PHE and established a lower interest rate of 4% for any demanded overpayments to recover CAAP balances due. The CAAP repayment terms provide as follows:

•Repayment begins 1 year starting from the date we issued your first CAAP.

•Beginning 1 year from the date we issued the CAAP and continuing for 11 months, we’ll recover the CAAP from Medicare payments due to providers and suppliers at a rate of 25%.

•After the end of this 11 month period, we’ll continue to recover remaining CAAP from Medicare payments due to providers and suppliers at a rate of 50% for 6 months.

•After the end of the 6 month period, your Medicare Administrative Contractor (MAC) will issue you a demand letter for full repayment of any remaining balance of the CAAP. If we don’t receive payment within 30 days, interest will accrue at the rate of 4% from the date your MAC issues you the demand letter. After that, we’ll assess interest for each full 30-day period that you fail to repay the balance.

If you received an accelerated or advance payment, CMS will begin to recoup any outstanding balance from any payments due to you from your Medicare claims. This began as soon as March 30, 2021, depending upon the 1 year anniversary of when you received your first payment.

CMS will show the recoupment on the remittance advices issued for Medicare Part A and B claims we process after the 1 year anniversary of issuing the first payment. The recoupment will appear as an adjustment in the Provider-Level Balance (PLB) section of the remittance advice.

Institutional providers who get Periodic Interim Payments should note that we won’t include CAAPs in the reconciliation and settlement of final cost reports. Instead, we’ll recoup from your periodic interim payments

 

Does HHS intend to recoup any payments made to providers not tied to specific claims for reimbursement, such as the General or Targeted Distribution payments? (Modified 3/31/2021)

The Provider Relief Fund Terms and Conditions require that recipients be able to demonstrate that lost revenues and expenses attributable to COVID-19, excluding expenses and losses that have been reimbursed from other sources or that other sources are obligated to reimburse, meet or exceed total payments from the Provider Relief Fund. Provider Relief Fund payment amounts that have not been fully expended on health care expenses or lost revenues attributable to coronavirus by the end of the final reporting period must be returned to HHS. The Provider Relief Fund Terms and Conditions and applicable legal requirements authorize HHS to audit Provider Relief Fund recipients now or in the future to ensure that program requirements are met. Provider Relief Fund payments that were made in error, or exceed lost revenue or expenses due to COVID-19, or do not otherwise meet applicable legal and program requirements must be returned to HHS, and HHS is authorized to recoup these funds.

Is there a set period of time in which providers must use the funds to cover allowable expense or lost revenues attributable to COVID-19? (Modified 3/31/2021)

Yes. As explained in the notice of reporting requirements on the Provider Relief Fund website, available at https://www.hhs.gov/coronavirus/cares-act-provider-relief-fund/reportingauditing/index.html, funds must be expended no later than June 30, 2021. HHS will provide directions in the future about how to return unused funds. HHS reserves the right to audit Provider Relief Fund recipients now or in the future, and is authorized to collect any Provider Relief Fund amounts that were overpaid or not used in a manner consistent with program requirements or applicable law. All payment recipients must attest to the Terms and Conditions, which require the submission of documentation to substantiate that these funds were used for health care-related expenses or lost revenue attributable to coronavirus.

In order to accept a payment, must the provider have already incurred eligible expenses and losses higher than the Provider Relief Fund payment received? (Modified 3/31/2021)

No. Providers do not need to be able to prove, at the time they accept a Provider Relief Fund Last updated: 3/31/2021 payment that prior and/or future lost revenues and expenses attributable to COVID-19 (excluding those covered by other sources of reimbursement) meet or exceed their Provider Relief Fund payment. HHS expects that providers will only use Provider Relief Fund payments in accordance with legal and program requirements. These requirements specify that if, on June 30, 2021, providers have remaining Provider Relief Fund money that they cannot expend on permissible expenses or losses, then providers will return this money to HHS. HHS will provide directions in the future about how to return unused funds. The Provider Relief Fund Terms and Conditions and legal requirements authorize HHS to audit Provider Relief Fund recipients now or in the future to ensure that program requirements are met. HHS is authorized to recoup any Provider Relief Fund amounts that were made in error or exceed lost revenue or expenses due to COVID-19, or in cases of noncompliance with the Terms and Conditions.

Can an organization that received a Provider Relief Fund payment and provided care on or after January 31, 2020 that sold, terminated, transferred, or otherwise disposed of a provider accept the payment (received via ACH or check) associated with the sold provider? (Modified 3/31/2021)

If an organization that sold, terminated, transferred, or otherwise disposed of a provider that was included in its most recent tax return gross receipts or sales (or program services revenue) figure can attest to meeting the Terms and Conditions, it may accept the funds. The Terms and Conditions place restrictions on how the funds can be used. In particular, all recipients will be required to substantiate that these funds were used for health care-related expenses or lost revenue attributable to coronavirus, and that those expenses or losses were not reimbursed from other sources and other sources were not obligated to reimburse them.

An organization that sold part of a practice in 2019 or January 2020 received a payment under the General Distribution that reflected the 2019 Medicare fee-for-service billing of the part of the practice that was sold. Can the parent entity return a portion of the payment for the part of the practice it no longer owns? (Modified 3/31/2021)

No. A provider may not return a portion of a Provider Relief Fund payment. If a provider that sold a practice that was included in its most recent tax return gross receipts or sales (or program services revenue) figure can attest to meeting the Terms and Conditions, it may accept the funds. The Terms and Conditions place restrictions on how the funds can be used. In particular, all recipients will be required to substantiate that these funds were used for health care-related Last updated: 3/31/2021 11 expenses or lost revenue attributable to coronavirus, and that those expenses or losses were not reimbursed from other sources and other sources were not obligated to reimburse them.

Can a parent organization transfer General Distribution Provider Relief Fund payments to its subsidiaries? (Modified 3/31/2021)

Yes, a parent organization can accept and allocate General Distribution funds at its discretion to its subsidiaries, as long as the Terms and Conditions are met. Eligible health care entities, including those that are parent organizations must substantiate that these funds were used for health care-related expenses or lost revenue attributable to COVID-19, and that those expenses or losses were not reimbursed from other sources and other sources were not obligated to reimburse them.

Can a parent organization allocate Provider Relief Fund General Distribution to subsidiaries that do not report income under their parent’s employee identification number (EIN)? (Modified 3/31/2021)

Yes, as long as the Terms and Conditions are met. The parent organization (an eligible health care entity) must substantiate that these funds were used for health care-related expenses or lost revenue attributable to COVID-19, and that those expenses or losses were not reimbursed from other sources and other sources were not obligated to reimburse them.

How does cost-based reimbursement relate to my Provider Relief Fund payment? (Modified 3/31/2021)

Recipient must follow CMS instructions for completion of cost reports available at https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Paper-Based-ManualsItems/CMS021935 Under cost-based reimbursement, the payer agrees to reimburse the provider for the costs incurred in providing services to the insured population. In these instances, if the full cost was reimbursed based upon this method, there is nothing eligible to report as an expense attributable to coronavirus because the expense was fully reimbursed by another source. Provider Relief Fund payments cannot be used to cover costs that are reimbursed from other sources or that other sources are obligated to reimburse. Therefore, if Medicare or Medicaid makes a payment to a provider based on the provider’s Medicare or Medicaid cost, such payment generally is considered to fully reimburse the provider for the costs associated with providing care to Medicare or Medicaid patients and no money from the PRF would be available for those identified Medicare and Medicaid costs. However, in cases where a ceiling is applied to the cost reimbursement or the costs are not reimbursed under cost-based reimbursement (such as costs for care to commercial payer patients) since the reimbursed amount by Medicare or Medicaid does Last updated: 3/31/2021 not fully cover the actual cost, those non-reimbursed costs are eligible for reimbursement under the Provider Relief Fund.

When reporting my organization’s healthcare expenses attributable to coronavirus, how do I calculate the “expenses attributable to coronavirus not reimbursed by other sources?” (Modified 3/31/2021)

Healthcare related expenses attributable to coronavirus may include items such as supplies, equipment, information technology, facilities, employees, and other healthcare related costs/expenses for the calendar year. The classification of items into categories should align with how Provider Relief Fund recipients maintain their records. Providers can identify their healthcare related expenses, and then apply any amounts received through other sources, such as direct patient billing, commercial insurance, Medicare/Medicaid/Children’s Health Insurance Program (CHIP), or other funds received from the Federal Emergency Management Agency (FEMA), the Provider Relief Fund COVID-19 Claims Reimbursement to Health Care Providers and Facilities for Testing, Treatment, and Vaccine Administration for the Uninsured, and the Small Business Administration (SBA) and Department of Treasury’s Paycheck Protection Program (PPP) that offset the healthcare related expenses. Provider Relief Fund payments may be applied to the remaining expenses or costs, after netting the other funds received or obligated to be received which offset those expenses. The Provider Relief Fund permits reimbursement of marginal increased expenses related to coronavirus provided those expenses have not been reimbursed from other sources or that other sources are not obligated to reimburse. For example, assume the following:

A $5 increase in expense or cost to provide an office visit is calculated by pre-pandemic cost vs. post-pandemic cost, regardless of reimbursement source:

• Pre-pandemic average expense or cost to provide an office visit =$80

• Post-pandemic average expense or cost to provide an office visit =$85

Examples of reimbursed amounts may include, but not be limited to:

• Example 1 Medicaid reimbursement: $70 (Report $85-$80 = $5 as expense attributable to coronavirus but unreimbursed by other sources)

• Example 2 Medicare reimbursement: $80 (Report $85-$80 = $5 as expense attributable to coronavirus but unreimbursed by other sources)

• Example 3 Commercial Insurance reimbursement: $85 (Report $5, commercial insurer did not reimburse for $5 increased cost of post-pandemic office visit)

• Example 4 Commercial Insurance reimbursement: $85 + $5 insurer supplemental coronavirus related reimbursement (Report zero since insurer reimbursed for $5 increased cost of post-pandemic office visit)

• Example 5 COVID-19 Claims Reimbursement to Health Care Providers and Facilities for Testing, Treatment, and Vaccine Administration for the Uninsured: $80 (Report $5 as expense attributable to coronavirus but unreimbursed by other sources)

Are providers that received payments under Phase 3 of the General Distribution limited to using these funds to cover coronavirus-related losses or expenses experienced during the first two quarters of calendar year 2020? (Modified 3/3/1/2021)

No. The Terms and Conditions require payment recipients to certify that funds will only be used to prevent, prepare for, and respond to coronavirus, and will only reimburse the recipient for health care-related expenses or lost revenues that are attributable to coronavirus. The Terms and Conditions do not place limits on which quarters these funds must be applied to cover eligible losses or expenses provided that funds are expended by June 30, 2021, per reporting guidelines. HHS is collecting information on the losses and expenses associated with the first two quarters of 2020 for purposes of making additional General Distribution payments to those providers with demonstrated financial need.

Is a health care provider eligible to receive a payment from the Phase 3 – General Distribution even if the provider received funding from the Small Business Administration’s (SBA) Payroll Protection Program or the Federal Emergency Management Agency (FEMA) or has received Medicaid HCBS retainer payments? (Modified 3/31/2021)

Yes. If the health care provider otherwise meets the criteria for eligibility, receipt of funds from SBA and FEMA for coronavirus recovery or of Medicaid Home-and Community-Based Services (HCBS) retainer payments, does not preclude a health care provider from being eligible for Phase 3 – General Distribution; however, the health care provider must substantiate that the Provider Relief Fund payments were used for health care related expenses or lost revenue attributable to COVID-19, and those expenses or lost revenue were not reimbursed from other sources or other sources were not obligated to reimburse.

IRS Updates Employee Retention Credit for 2020
This article is from AHCA/NCAL.

This week, the Internal Revenue Services (IRS) issued guidance for employers claiming the employee retention credit under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), as modified by the Taxpayer Certainty and Disaster Tax Relief Act of 2020 (Relief Act), for calendar quarters in 2020. According to the IRS:

The guidance in Notice 2021-20 is similar to the information in the employee retention credit FAQs, but includes clarifications and describes retroactive changes under the new law applicable to 2020, primarily relating to expanded eligibility for the credit.

For 2020, the employee retention credit can be claimed by employers who paid qualified wages after March 12, 2020, and before January 1, 2021, and who experienced a full or partial suspension of their operations or a significant decline in gross receipts. The credit is equal to 50 percent of qualified wages paid, including qualified health plan expenses, for up to $10,000 per employee in 2020. The maximum credit available for each employee is $5,000 in 2020.

A significant change for 2020 made by the Relief Act permits eligible employers that received a Paycheck Protection Program (PPP) loan to claim the employee retention credit, although the same wages cannot be counted both for seeking forgiveness of the PPP loan and calculating the employee retention credit. Notice 2021-20 explains when and how employers that received a PPP loan can claim the employee retention credit for 2020.

Notice 2021-20 also provides answers to questions such as: who are eligible employers; what constitutes full or partial suspension of trade or business operations; what is a significant decline in gross receipts; how much is the maximum amount of an eligible employer’s employee retention credit; what are qualified wages; how does an eligible employer claim the employee retention credit; and how does an eligible employer substantiate the claim for the credit.

While the Relief Act also extended and modified the employee retention credit for the first two calendar quarters in 2021, Notice 2021-20 addresses only the rules applicable to 2020. The IRS plans to release additional guidance soon addressing the changes for 2021.

A page on the IRS website is focused on providing information to businesses​ on all aspects of the CARES Act.

The Rural Health Clinic (RHC) COVID-19 Testing Program requires that recipients report payments received separately from the payment(s) received as part of the Provider Relief Fund. How do RHCs determine whether they received payment as part of the RHC COVID-19 Testing Program? (Added 2/24/2021)

RHCs that were issued a payment with the descriptor “HHSPAYMENT” or “COVID*RuralHealthTestingPmt*HHS.GOV” on or around May 20, 2020, June 9, 2020, December 7, 2020, and/or January 20, 2021, received these payments as part of RHC COVID-19 Testing Program. HHS provided $49,461.42 for each eligible RHC with a unique CMS Certification Number (CCN) associated with an eligible Tax Identification Number (TIN). TIN organizations must report data associated with COVID-19 testing payments on the Rural Health Clinic COVID-19 Testing Report Portal available at https://www.rhccovidreporting.com/. For additional information, please visit HRSA’s website at https://www.hrsa.gov/ruralhealth/coronavirus/frequently-asked-questions#rhc. If you have additional questions please email RHCcovidreporting@narhc.org for technical assistance.

 

Are there any restrictions on how hospitals that receive Medicaid disproportionate share hospital (DSH) payments can use Provider Relief Fund General and Targeted Distribution payments? (Added 2/24/2021)

Yes. Providers may not use PRF payments to reimburse expenses or losses that have been reimbursed from other sources or that other sources are obligated to reimburse. Therefore, if a hospital has received Medicaid DSH payments for the uncompensated costs of furnishing inpatient and/or outpatient hospital services to Medicaid beneficiaries and to individuals with no source of third party coverage for the services, these expenses would be considered reimbursed by the Medicaid program and would not be eligible to be covered by money received from a General or Targeted Distribution payment. For more information on the calculation of the Medicaid hospital-specific DSH limit, see https://www.medicaid.gov/state-resourcecenter/downloads/covid-19-faqs.pdf.

 

Can Reporting Entities claim the time spent by staff and director-level resources on COVID-19-specific matters, such as participating in task forces or preparing their health care organization’s COVID-19 response, that they would not have otherwise spent time on in the absence of the pandemic? (Added 2/24/2021)

Time spent by staff on COVID-19-specific matters may be an allowable cost attributable to coronavirus so long as it was not reimbursed or obligated to be reimbursed by other sources. If the personnel salaries are reimbursed by any other source of funding they cannot be also reimbursed by the Provider Relief Fund. In addition, no one individual may be allocated as greater than one full-time equivalent (FTE) across all sources of funding. All costs must be tangible expenses (not opportunity costs) and must be supported by documentation. The Reporting Entity must maintain appropriate records and cost documentation including, as applicable, documentation described in 45 CFR § 75.302 – Financial management and 45 CFR § 75.361 through 75.365 – Record Retention and Access, and other information required by future program instructions to substantiate the reimbursement of costs under this award. The Recipient Last updated: 2/24/2021 17 must promptly submit copies of such records and cost documentation upon the request of the Secretary, and the Reporting Entity agrees to fully cooperate in all audits the Secretary, Inspector General, or Pandemic Response Accountability Committee conducts to ensure compliance with these Terms and Conditions.

 

How does cost-based reimbursement relate to my Provider Relief Fund payment? (Modified 2/24/2021)

Recipient must follow CMS instructions for completion of cost reports available at https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Paper-Based-ManualsItems/CMS021935. Under cost-based reimbursement, the payer agrees to reimburse the provider for the costs incurred in providing services to the insured population. In these instances, if the full cost was reimbursed based upon this method, there is nothing eligible to report as an expense attributable to coronavirus because the expense was fully reimbursed by another source. Provider Relief Fund payments cannot be used to cover costs that are reimbursed from other sources or that other sources are obligated to reimburse. Therefore, if Medicare or Medicaid makes a payment to a provider based on the provider’s cost, such payment generally is considered to fully reimburse the provider and no money from the PRF would be available. However, in cases where a ceiling is applied to the cost reimbursement and the reimbursed amount by Medicare or Medicaid does not fully cover the actual cost due to unanticipated increases in providing care attributable to coronavirus, those incremental costs that were not reimbursed are eligible for reimbursement under the Provider Relief Fund.

 

Recently an article was published by Health Affairs that propose various recommendations relative to Nursing Home oversight and ownership disclosure that the authors believe should be made part of the Medicare Cost Report process. Some states have begun pursuing similar initiatives but this is the first time we have seen a proposal to include these items in regards to Cost Reports. The authors are:

Charlene Harrington – Professor Emeritus in the Department of Social and Behavioral Sciences at the University of California, San Francisco.

Anne Montgomery – Director of the Center for Eldercare Improvement .

Terris King, ScD – CEO of King Enterprise Group, LLC, and was director of minority health (retired) at the Centers for Medicare and Medicaid Services.

David C. Grabowski, PhD – Professor in the Department of Health Care Policy at Harvard Medical School.

Michael Wasserman, MD, CMD – Chair, Public Policy Committee, California Association of Long Term Care Medicine, and former CEO of Rockport Healthcare Services.

The recommendations include:

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HHS should immediately create an interagency (CMS, HHS OIG, Department of Justice (DOJ), and the Centers for Disease Control and Prevention) Early Detection Task Force to identify and monitor nursing homes that need more focused attention. The task force would analyze PECOS data in addition to information about staffing and medical director administrative time from the Payroll-Based Journal (PBJ) database, data from the survey and certification inspection program, and spending patterns from Medicare cost reports.  The task force would coordinate oversight and monitoring across the federal government and with states, and report actionable recommendations—for example, whether “strike teams” may be needed if facilities are not able to assure resident safety, for example, during emergencies.

CMS should augment PECOS reporting to include all parent, management, and property companies, and other related party entities and ensure enforcement of Section 6101 of the ACA, including that companies provide a complete organizational chart. Failure to provide such complete and accurate data should result in specified financial penalties until the information is provided.

CMS’s Care Compare website should present information that is searchable not only by individual facilities but also by chain and common ownership, and an annual compendium should be published on the quality of care in nursing home chains.

CMS should promulgate federal regulations specifying minimum criteria for the purchase (or change of ownership) or management of any nursing home. The criteria should prevent individual or corporate owners from purchasing, operating, or managing additional facilities if they have a history of owning or operating other facilities with chronically low staffing and poor-quality care in any state. Companies with corporate settlements for fraud or for “worthless services” should be barred from purchasing new nursing homes for five years.

CMS should establish a prior approval process for changes in ownership or management. To implement these requirements, CMS should establish a centralized application unit for ownership and management evaluations, with processes delineated to work with state agencies, state attorneys general, and the DOJ. Finally, CMS should establish minimum per-day penalties for any owner or operator who has not received prior approval for a licensee or a change of ownership, including an automatic denial of payments.

Cost report requirements should be amended to require each nursing home to provide annual consolidated financial reports that include data from operating entities (license holders) and all organizations and entities related by common ownership or control. The reports should provide flow charts of all related party entities including home offices, management organizations, staffing, therapy, supply, pharmaceutical, consulting, insurance, banking, investment entities, parent companies, holding companies, and sister organizations. Management companies and property companies should also be required to provide a full financial report annually. The cost reports should be prepared by a certified public accounting firm.

Finally, a combined financial and oversight system should be established by CMS to conduct annual joint Medicare and Medicaid audits. It should include home office and related-party payer audits, with penalties levied for inaccurate cost data. As part of the audit oversight, CMS should be given full access to Internal Revenue Service filings of entities involved in the nursing home operation.

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Please keep in mind that the new HHS Secretary is coming from California as well as many of the articles’ authors. We would would assume some of them will probably have a relationship with the Secretary or his staff. While some of these recommendations are probably overly complex and unlikely to be implemented

(e.g. joint Medicare and Medicaid audits are unlikely given the different systems in every state), some of these concepts will probably get some traction.  We could see increased PECOS reporting with additional focus on ownership structure including disclosure of facilities under common control.  We also could see additional cost report disclosure requirements being implemented in addition to a continued increased focus on related party transactions.