Image by: Adam Niescioruk
Date Prepared: April 11, 2020
Beginning on April 10, 2020, eligible health care providers will automatically receive additional COVID aid from the Department of Health & Human Services. HHS is distributing $30 billion by directly depositing funds into bank accounts of eligible health care providers. Although this initial $30 billion distribution is in form of a payment and does not have to be paid back, the payment comes with certain obligations and conditions which should be considered prior to acceptance. Below are responses to common questions about these aid payments.
UPDATE: The CARES Act Provider Relief Fund Payment Attestation Portal is now open. Providers who have been allocated a payment from the initial $30 billion general distribution must sign an attestation confirming receipt of the funds and agree to the terms and conditions within 30 days of payment.
- What is Health care provider relief fund and how much total funds were allocated to provider relief under the CARES Act?
CARES Act allocates $100 billion to Department of Health of Human Services in “Public Health and Social Services Emergency Fund” to prevent, prepare for, and respond to coronavirus, for necessary expenses of eligible health care providers on the front lines of the COVID-19 response.
- How much of the total payment is being distributed immediately?
In their guidance, HHS stated that $30 billion of this payment is being distributed immediately.
According to the Department of Health and Human Services (HHS), this funding will be used to support healthcare-related expenses or lost revenue attributable to COVID-19 and to ensure uninsured Americans can get testing and treatment for COVID-19.
- What is the purpose of this initial $30 billion relief payment?
This quick dispersal of funds will provide relief to both providers in areas heavily impacted by the COVID-19 pandemic and those providers who are struggling to keep their doors open due to healthy patients delaying care and cancelled elective services.
- When will providers receive this initial $30 billion?
Beginning on Friday, April 10, 2020, HHS plans to distribute the $30 billion amount through direct deposit to eligible providers in the American healthcare system.
- Who is eligible to receive this initial $30 billion payment allocation?
All facilities and providers that
- received Medicare fee-for-service (FFS) reimbursements in 2019;
- currently provide diagnoses, testing, or care for individuals with possible or actual cases of COVID-19 (according to AMA, HHS intends to provide relief to both providers in areas heavily impacted by the COVID-19 pandemic and those providers who are struggling to keep their doors open due to healthy patients delaying care and cancelled elective services – additional clarifications will be provided in future guidance) ;
- are not currently terminated from participation in Medicare;
- are not currently excluded from participation in Medicare, Medicaid, and other Federal health care programs; and
- do not currently have Medicare billing privileges revoked.
HHS has announced that the administration plans on using a portion of the remaining funds to provide payments to other providers, such as pediatricians and children hospitals which participate in Medicaid plans. See, Question #18.
- Do the provides have to pay back these amounts?
No. These are payments, not loans, to eligible healthcare providers, and will not need to be repaid.
- How are the payments distributed to practices which are part of a larger medical group?
Payments to practices that are part of larger medical groups will be sent to the group’s central billing office. All relief payments are made to the billing organization according to its Taxpayer Identification Number (TIN).
- How are the payments distributed to solo practitioners?
Solo practitioners who bill Medicare will receive a payment under the TIN used to bill Medicare.
- Do individual employed practitioners receive these payments?
No. Employed physicians should not expect to receive an individual payment directly. The employer organization will receive the relief payment as the billing organization.
- How much of the $30 billion will a provider receive?
Providers will be distributed a portion of the initial $30 billion based on their share of total Medicare FFS reimbursements in 2019. Total FFS payments were approximately $484 billion in 2019.
A provider can estimate their payment by dividing their 2019 Medicare FFS (not including Medicare Advantage) payments they received by $484 billion and multiply that ratio by $30 billion.
Providers can obtain their 2019 Medicare FFS billings from their organization’s revenue management system.
As an example: A community hospital billed Medicare FFS $121 million in 2019. To determine how much they would receive, use this equation:
$121,000,000/$484,000,000,000 x $30,000,000,000 = $7,500,000.
- Do providers have to take any steps to receive these payments?
No. Payments will be automatically distributed by HHS. See, Question #12.
HHS has partnered with UnitedHealth Group (UHG) to provide rapid payment to providers eligible for the distribution of the initial $30 billion in payments.
Providers will be paid via Automated Clearing House account information on file with UHG or the Centers for Medicare & Medicaid Services (CMS).
The automatic payments will come to providers via Optum Bank with “HHSPAYMENT” as the payment description.
Providers who normally receive a paper check for reimbursement from CMS, will receive a paper check in the mail for this payment as well, within the next few weeks.
- What are the conditions for accepting this initial relief payment from HHS?
The following are the conditions for accepting the payments:
- providers must agree not to seek collection of out-of-pocket payments from a COVID-19 patient that are greater than what the patient would have otherwise been required to pay if the care had been provided by an in-network provider.
- providers must accept payment at Medicare in-network rates for COVID-related treatments of the uninsured.
- Providers cannot “balance-bill” any patients for COVID-related treatment.
- Within 30 days of receiving the payment, providers must agree to the Terms and Conditions set forth by the HHS and sign an attestation confirming receipt of the payments and agreeing to the terms and conditions of payment. The portal for signing the attestation will be open the week of April 13, 2020. You may view a copy of the Terms and Conditions here.
- private insurers, including Humana, Cigna, UnitedHealth Group, and the Blue Cross Blue Shield system have committed to waive cost-sharing payments for treatment related to COVID-19 for plan members.
- What are the permissible uses of the received payments?
The received payments must only be used to prevent, prepare for, and respond to coronavirus, and shall reimburse the recipient provider only for health care related expenses or lost revenues that are attributable to coronavirus.
The payments cannot be used to reimburse expenses or losses that have been reimbursed from other sources or that other sources are obligated to reimburse and other prohibited uses[i].
- Can a provider refuse the payments because it does not wish to comply with the Terms and Conditions imposed by HHS?
Yes. If a provider receives payment and does not wish to comply with the Terms and Conditions imposed by HHS, the provider must do the following:
- Contact HHS within 30 days of receipt of payment and then remit the full payment to HHS as instructed. HHS will provide appropriate contact information soon.
- Are there reporting obligations for accepting these payments?
Yes. All recipients of the payments who would like to accept these payments, must submit reports to ensure compliance with terms of payment. HHS is to provide future guidance on how these providers must report expenditure of the received payments.
Providers who receive more than $150,000 total payments under the following acts and would like to accept the payments received from HHS, must provide a report to the Secretary within 10 days of each calendar quarter:
- Coronavirus Aid, Relief, and Economics Security Act (P.L. 116-136),
- the Coronavirus Preparedness and Response Supplemental Appropriations Act (P.L. 116-123),
- the Families First Coronavirus Response Act (P.L. 116-127), or
- any other Act primarily making appropriations for the coronavirus response and related activities.
For providers who receive more than $150,000, the report shall contain:
- the total amount of funds received from HHS under one of the foregoing enumerated Acts;
- the amount of funds received that were expended or obligated for reach project or activity;
- a detailed list of all projects or activities for which large covered funds were expended or obligated, including:
- the name and description of the project or activity, and the estimated number of jobs created or retained by the project or activity, where applicable; and
- detailed information on any level of sub-contracts or subgrants awarded by the covered recipient or its subcontractors or subgrantees, to include the data elements required to comply with the Federal Funding Accountability and Transparency Act of 2006 allowing aggregate reporting on awards below $50,000 or to individuals, as prescribed by the Director of the Office of Management and Budget.
- What documentations should be maintained by payment recipients?
- Providers who receive the payment from HHS must maintain appropriate records and cost documentation including, as applicable,
- documentation required by 45 CFR § 75.302 – Financial management and 45 CFR § 75.361 through 75.365,
- Record Retention and Access,
- other information required by future program instructions to substantiate the reimbursement of costs under this payment award, and,
According to AMA, HHS officials have noted that it is important to acknowledge that HHS is disbursing these funds in advance of an attestation with the expectation that each recipient could document, if asked, that they have experienced lost revenue or increased costs that are at least equal to the amount of the grant.
Recipient shall promptly submit copies of such records and cost documentation upon the request of the Secretary, and Recipient 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.
- Is this payment different from the CMS Accelerated and Advance Payment Program?
Yes. The CMS Accelerated and Advance Payment Program has delivered billions of dollars to healthcare providers to help ensure providers and suppliers have the resources needed to combat the pandemic. The CMS accelerated and advance payments are a loan that providers must pay back.
- How will HHS expend the remaining $70 billion of the fund?
The Administration is working rapidly on targeted distributions that will focus on providers in areas particularly impacted by the COVID-19 outbreak, rural providers, providers of services with lower shares of Medicare reimbursement or who predominantly serve the Medicaid population, and providers requesting reimbursement for the treatment of uninsured Americans.
[i] Payment recipients cannot use the received payment: to pay the salary of an individual in excess of Executive Level II; to advocate or promote gun control; to pay for lobbying or salary or expense of a lobbyist; for abortion except in limited circumstances; for health benefits coverage which includes coverage for abortion; for embryo research; to promote legalization of controlled substances; for pornography; to fund ACORN or its affiliates or subsidies; for needle exchange except in limited circumstances; for propaganda not authorized by the Congress; in contravention of the Privacy Act – section 552a of title 5, US Code; for contract with entities which require employees not to report fraud, waste or abuse under and NDA or similar agreements; to implement of enforce improper NDAs or similar agreements; for unpaid federal tax liability; to contract with, engage with or pay anyone convicted of federal felony in the past 24 months; etc.
By: Reza Ghafoorian, MD, JD.
Dr. Ghafoorian is the founder and Principal attorney at G2Z Law Group, PLLC, a health care law firm established in 2012. Dr. Ghafoorian focuses his practice in the fields of provider health law and patent law, representing health care entities and professionals. https://g2zlaw.com/attorneys#Ghafoorian