Healthcare Providers All Set to Receive $25.5 Billion in COVID-19 Relief Funds

Finally a sigh of relief for the healthcare providers, who are being affected by the viral COVID-19 pandemic. Because in a major initiative the U.S. Department of Health and Human Services (HHS), through the Health Resources and Services Administration (HRSA), has announced relief funds.

As per details, HHS has allocated $8.5 billion in American Rescue Plan (ARP) resources for providers_ who provided the care services to the Medicare patients, rural Medicare and Children’s Health Insurance Program (CHIP). On the other hand, an additional $17 billion for Provider Relief Fund (PRF) Phase 4 for a broad range of providers_ who can document revenue loss and expenses associated with the pandemic.

HHS Secretary Xavier Becerra in an official statement said that_ this funding will help healthcare providers, who had to face excessive workloads and particularly the critical financial crisis, caused by the ongoing pandemic. While talking about the distribution of the funds, he made it clear that: the announced funds will be distributed on an equity basis. The authorities will make sure that the providers who make every possible effort to alleviate the sufferings of the most vulnerable communities receive the financial support they deserve.

According to the requirements included in the Coronavirus Response and Relief Supplemental Appropriations Act of 2020. Medical practitioners will receive the PRF Phase 4 payments, which totally depends on their expenditures and the revenue they lost between July 1, 2020, and March 31, 2021. Furthermore, in order to ensure fairness and financially support the deserving medical providers. The HHS has decided that PRF phase 4 payments will reimburse those who continue to serve the isolated communities even on thin margins_ for their lost revenues and COVID-19 expenses at a higher rate compared to larger providers.

Moreover, healthcare practitioners who serve Medicaid, CHIP, and/or Medicare patients, with lower incomes and complicated medical needs will get bonus payments for these remarkable services. Such bonus payments will be priced at generally higher Medicare rates. Which will ensure fair compensations for the providers who opted to improve the lives of low-income children, pregnant women, people with disabilities, and seniors.

Likewise, ARP rural payments will be based on the amount of Medicaid, CHIP and/or Medicare services that medical practitioners offer to the patients living in the underprivileged areas, the HHS said in an official statement. Accordingly, ARP rural payments will also generally be based on Medicare reimbursement rates.

“We know that this funding is critical for health care providers across the country, especially as they confront new coronavirus-related challenges and respond to natural disasters,” said Acting HRSA Administrator Diana Espinosa. “We are committed to distributing this funding as equitably and transparently as possible to help providers respond to and ultimately defeat this pandemic.” The concerned authorities will use existing Medicaid, CHIP and Medicare claim data in order to calculate the payments accurately.

It’s pertinent to mention here that the healthcare providers can apply for both programs in a single application, which is set to be opened on September 29, 2021. Moreover, PRF recipients are bound to notify the HHS secretary: in case of any merger or acquisition with any healthcare provider to ensure that_ they are using the allocated relief funds for the actual purpose. Which is to provide the standard medical aid to the patients.

They are also required to give a proper time frame during which they can use the payments. In addition to this, HHS has made it clear that the authority will launch the proper audits to make sure that the providers (who report a merger) have used the funds to meet the costs associated with the COVID-19.

Moreover, HHS has also released detailed information (which can be accessed from their official website) on which methodology is being utilized to calculate the PRF phase 3 payments. The purpose of making the methodology public is to ensure transparency in the entire reimbursement process. While sticking to its commitment to equity and equality. The federal authority has also provided a chance to providers of reconsideration if they have any confusion or doubt on payments calculations.

Are you running short on time to keep in compliance with the PRF reporting requirements? And can’t prepare yourself for the first PRF reporting till the given deadline of September 30, 2021? If so, then don’t worry. The United States Department of Health and Human Services has announced a grace period of 60 days. This decision came after observing the challenges. That practitioners across the US are facing to deal with the recent natural disasters and the Delta variant. As per the details, the federal authority will not take action against non-compliant providers during this grace period. But the deadlines to use funds and the Reporting Time Period will not change.

Key Takeaways of Phase 4 of PRF Distribution

Provider Relief Fund (PRF) Phase 4 payments will be distributed according to the following guidelines:

  • A major portion as approximately 75% of Phase 4 distribution will depend on the revenue that healthcare practitioners have lost so far_ as well as costs related to the COVID-19.
  • Large providers will be given minimum reimbursements totally based on the percentage of the COVID related expenditures and lost revenue.
  • Medium and small healthcare providers, who continue to provide care services to the vulnerable communities on tight budgets, will get additional bonuses.
  • Data received by the applications (submitted by the providers) will be thoroughly analysed to ensure fair distribution.
  • HHS will conduct audits to make sure that the allocated funds are being used to fulfil the actual purpose to serve the community in the fight against the ongoing pandemic.
  • 25% of the Phase 4 allocation will be spent on the amount and quality as well as the type of healthcare services provided to the Medicaid, CHIP, and Medicare patients.

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