HHS Provides More Details on Provider Relief Fund Reporting

HHS recently shared additional information on Provider Relief Fund reporting requirements for healthcare organizations that received financial support under the Coronavirus Aid, Relief, and Economic Security (CARES) Act and subsequent legislation.

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A notice shared last week by the federal department stated that healthcare organizations that received one or more payments from the Provider Relief Fund exceeding $10,000 in aggregate will have to submit reports to HHS detailing the use of the funds and compliance with payment terms and conditions.

The CARES Act and Paycheck Protection Program and Health Care Enhancement Act allocated a total of $175 billion to the Provider Relief Fund. The fund included $50 billion in general distribution payments, which went to approximately 335,000 Medicare providers based on their net patient from years past, as well as targeted distribution payments for rural hospitals, skilled nursing facilities, safety-net hospitals, and hospitals in COVID-19 hotspots.

Per the terms and conditions signed upon receipt and acceptance of the payments, providers who received any of the Provider Relief Fund payments in excess of the specified amount will be required to report on their expenditures through December 31, 2020, within 45 days of the end of the 2020 calendar year.

HHS will open the reporting system for the required reported on October 1, 2020, and provide more detailed information on Provider Relief Fund reporting requirements by August 17, 2020.

The Health Resources and Services Administration, which is in charge of overseeing the distribution of Provider Relief Fund payments, will also host educational sessions for providers.

Auditing and reporting requirements have been a major question for providers who automatically received Provider Relief Fund payments during the early phases of the pandemic.

To accept the relief payments, providers agreed to fully cooperate in all audits and HHS advised them to maintain records and cost documentation on how the funds were used. The terms and conditions also stated that the providers would need to submit reports to HHS to ensure compliance.

Last month, HHS clarified in an official FAQ that recipients of Provider Relief Fund payments would not need to submit quarterly reports to HHS or the Pandemic Response Accountability Committee.

More recently, HHS added additional FAQs to its Provider Relief Fund webpage for providers. The FAQs address single audit requirements, confirming that general and targeted distribution payments, as well as payments made to cover the COVID-19 treatment costs of uninsured patients would need to be included in determining if an organization that received the payments must have an audit in accordance with the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HHS Awards (45 CFR Part 75).

The healthcare industry should expect heightened scrutiny of the Provider Relief Fund payments despite the government dedicating most of its resources to combating COVID-19.

“Government enforcement isn’t going to subside, but the focus is going to be much more on the traditional fraud and abuse notions,” Chris DeMeo, a partner in Seyfarth's corporate department and a member of the Health Care, Life Sciences & Pharmaceuticals industry group, recently told RevCycleIntelligence.

Government fraud, waste, and abuse investigators will be more critical of determining whether HHS awards were used for the intended purposes, DeMeo said. Per the terms and conditions for general distribution payments, that is the prevention, preparation of, and response to COVID-19.

Providers may also use the payments for “health care related expenses or lost revenues that are attributable to the coronavirus,” according to the terms and conditions.

The terms leave the door open for providers to interpret what they can do with the Provider Relief Funds. Therefore, documentation of how the funds were spent and why is critical to avoiding potential healthcare fraud and abuse accusations later.

“As providers begin deploying the funds, detailed documentation of uses as well as their justification should be carefully compiled,” Kate Broderick, manager of Citrin Cooperman, recently wrote in a Boston Business Journal report.

“Providers should expect to be required to provide their justification for each expenditure, detailing how it helped to prevent, prepare for or respond to coronavirus and whether it is attributed to the health care-related expenses or lost revenue category,” Broderick concluded. “Documentation will likely include general ledger, individual receipts, line-item budgets and internal financial statements.”