HHS to Distribute $560M in Phase 4 COVID-19 Provider Relief Funds

HHS is distributing another $560 million in Provider Relief Fund Phase 4 payments to over 4,100 healthcare providers that have been affected by the COVID-19 pandemic.

Provider Relief Funds have been crucial to supporting healthcare providers as they continue to care for patients during the pandemic.

Following this new round of funding, the Health Resources and Services Administration (HRSA) has allocated nearly $11.5 billion of the promised $17 billion Phase 4 general distribution payments to more than 78,000 providers across the country. HRSA has distributed almost $7.5 billion in American Rescue Plan Rural payments to more than 44,000 providers since November 2021.

“Provider Relief Funds have been a lifeline for healthcare providers across the country,” HHS Secretary Xavier Becerra said in the announcement. “From providing life-saving care to tackling workforce challenges, these funds will help many healthcare facilities weather the pandemic’s continued impact. The Biden-Harris Administration will continue to ensure our providers have the necessary support and tools to keep our families safer and healthier.”

HHS announced it would make this fourth round of Provider Relief Payments in September 2021. The department is focusing on equity with this phase of funding and prioritizing smaller providers who have faced financial difficulties. To receive funds, providers must demonstrate revenue losses and expenses associated with the COVID-19 pandemic between July 1, 2020, and March 31, 2021.

Additionally, providers who serve Medicaid, Children’s Health Insurance Program (CHIP), and Medicare beneficiaries will receive bonus payments.

“Healthcare providers have continued to lead the fight against COVID-19 from the frontlines,” HRSA Administrator Carole Johnson stated in the announcement. “The Provider Relief Fund is an important resource in helping to support this work and sustain health services and the dedicated health care workforce across the country.”

Around 86 percent of the Phase 4 applications have been processed, HHS said. The department will process the remaining applications throughout early 2022.

HHS distributed the first batch of Phase 4 payments in December 2021. Around 69,000 providers received $9 billion in funds.

During the second round, more than $2 billion was distributed to around 7,600 providers across the country.

So far, providers in California and New York have received the highest payment amounts during Phase 4 of the Provider Relief Funds, collecting respective totals of $1.4 billion and $1.1 billion.

However, healthcare organizations are still struggling financially amid the recent Omicron surge and continued workforce shortages.

The American Hospital Association (AHA) penned a letter to Congress in January 2022 asking leaders to allocate an additional $25 billion to the COVID-19 Provider Relief Fund.

Additionally, a recent report from Kaufman Hall revealed that despite seeing better finances in 2021 compared to 2020, hospitals entered 2022 with higher expenses and worsening staff shortages.