Update (June 21, 2021):
Healthcare providers receiving Provider Relief Fund payments will have
to report to the government on using such payments before certain newly
announced spending deadlines. The first spending deadline is June 30,
2021, with a 90-day reporting period beginning July 1, 2021, to report
on funds received in the first half of 2020. For the most recent
updates on future deadlines and further guidance on Provider Relief
Fund reporting, visit
our Provider Relief Fund reporting page.
The U.S. Department of Health and Human Services (HHS)
announced on Jan. 15, 2021, that it was delaying both (i) the deadline for the initial final report
from recipients of the Public Health and Social Services Emergency Fund
(Provider Relief Fund) and (ii) the opening of the applicable reporting
portal. However, HHS did open registration for its reporting portal and
provide additional guidance discussed in this alert for Provider Relief
Fund recipients. This delay comes in light of legislative changes in the
recent spending and COVID-19 relief package (H.R. 133), discussed in a
Jan. 4, 2021, McGuireWoods alert, which allocated an additional $3 billion in funding for the Provider
The Provider Relief Fund was created through congressional appropriations
now totaling $178 billion to reimburse providers’ eligible expenses and
lost revenues attributable to COVID-19 (as discussed in previous
McGuireWoods legal alerts). HHS developed the Provider Relief Fund through
multiple rounds of payments, including General Distributions and Targeted Distributions to
certain providers. HHS also published answers to
frequently asked questions (FAQs) and other program announcements, such as the announced delay
discussed above. In November 2020, HHS issued updated reporting and
guidance, as discussed most recently in a
Nov. 3, 2020, McGuireWoods alert, before the recent legislative enactment. This guidance requires any
recipient of at least $10,000 from the Provider Relief Fund to report
healthcare-related and general and administrative expenses and lost revenue
attributable to COVID-19, with more detailed expense reporting for each
provider receiving $500,000 or more.
This alert summarizes the key Provider Relief Fund updates healthcare
providers should keep in mind as they prepare their reports.
- No new deadline was announced for submission of the initial report.
HHS stated it “wanted to give recipients ample time to familiarize
themselves with the updated reporting requirements well in advance of
required submission deadlines,” and would no longer require final reports
on Feb. 15, 2021. HHS did not announce a new deadline for this first
report, but its updated guidance still refers to the deadline for second
mandatory report for expenditures and lost revenue as July 31, 2021. HHS
stated it would announce a new deadline at a later date for recipients
receiving at least $10,000 from the Provider Relief Fund. Likely due to the
updated guidance necessitated by H.R. 133 discussed below, HHS also did not
open the reporting portal itself.
- HHS updated reporting guidance to incorporate changes from H.R. 133,
including “lost revenue” metrics and transfers between subsidiaries.
issued an updated Post-Payment Notice of Reporting Requirements document superseding its Nov.
2, 2020, guidance, which largely tracks the prior guidance (as shown in this comparison document). The main changes to the guidance reflect the H.R. 133 requirement that
HHS give recipients greater flexibility in calculating lost revenue. HHS’
guidance now allows three alternative methodologies to calculate lost
revenue: (a) the difference between 2019 and 2020 actual patient care
revenue; (b) the difference between 2020 budgeted and 2020 actual patient
care revenue, as long as the budget was approved prior to March 27, 2020;
and (c) calculation by any other reasonable method of estimating revenue,
which HHS notes will lead to a higher likelihood of government audit. HHS
will also allow providers to compare first and second quarters 2021 actual
revenue against budgeted 2020 revenue for purposes of the second report
showing 2021 expenditures. In exchange for this flexibility, HHS will
require additional information from Provider Relief Fund recipients,
including the recipient’s budget and an attestation regarding the same, or
a description of its methodology with calculations and an explanation of
why this methodology is reasonable and related to COVID-19.
In addition, HHS revised its guidance to reflect the H.R. 133 requirement
that recipients be allowed to allocate funds from Targeted Distributions to
the recipients’ subsidiaries. While HHS had allowed parent organizations to
allocate General Distributions to eligible subsidiary providers within the
same organizational structure, HHS previously did not allow this
flexibility for Targeted Distributions paid to specific categories of
providers because it wanted control and use to remain with the recipient
entity (e.g., the safety-net hospital, rural provider, skilled nursing
facility or high-impact COVID-19 hospital). HHS will still require the
initial recipient of the Targeted Distribution to report on the use of
funds and report the funds were transferred. HHS noted that this transfer
of funds will also increase the likelihood of a government audit.
- HHS will require reporting two additional data elements.
While the updated guidance largely tracks prior guidance, as discussed
above, HHS did include two additional data elements that Provider Relief
Fund recipients will need to submit. First, if the recipient held payments
in an interest-bearing account, that interest must be reported. Previously,
HHS stated in its FAQs that interest may need to be returned if the
underlying payments are returned based on failing to meet program
requirements. Second, HHS will ask for information about the recipient’s
reporting entity type, meaning whether the recipient qualifies in
categories such as receiving only automatic Phase 1 payments, received
Targeted Distributions, or whether the recipient has a parent organization.
Finally, revenue information will need to include the recipient’s payor
- Reporting portal’s registration is now open — providers should take
While delaying the reporting deadline and delaying the reporting portal’s
opening, HHS did open
registration for its reporting portal, which must be completed before the recipient can report on its use of
funds, once the portal opens. To register (as explained in the new
user guide), a recipient must provide its tax ID, business name, contact information
that includes an email address for next-step notifications (recipients
PRFReporting-NoReply@hrsa.gov to their safe sender lists), address, TIN of subsidiaries (which can be
updated if this is not filled out correctly) and payment information for
any one of the Provider Relief Fund payments received. In registering,
providers can access a
new FAQs document for more information about registration. Providers must register each
recipient separately with a different user name in the form of an email
address, but can then have the same contact email for multiple registered
recipients. If any information regarding the payment TIN or subsidiary TINs
is not entered correctly, providers will not be able to proceed to the next
steps in the registration process.
- HHS has distributed nearly $120 billion of the Provider Relief Fund.
In its announcement, HHS noted that 644,091 provider TINs had received
$116,956,445,191 through the General and Targeted Distributions of the
Provider Relief Fund. HHS also said 30,074 providers had received an
additional $3,013,189,068 for COVID-19 claims reimbursement for testing
and treatment of the uninsured. As noted above, after H.R. 133, HHS has
a total of $178 billion for the Provider Relief Fund. H.R. 133 also
required HHS to create a successor General Distribution phase for
eligible healthcare providers to “consider financial losses and changes
in operating expenses occurring in the third or fourth quarter of
calendar year 2020, or the first quarter of calendar year 2021, that
are attributable to coronavirus.” While HHS’ numbers may adjust, this
likely means there will be a substantial amount of money available for
providers experiencing significant COVID-19-related challenges during
the recent months of the pandemic.
HHS noted in its guidance that it may update its FAQs “to provide greater
clarity about the reporting process.” Such an approach would be consistent
with past developments, as HHS has frequently issued FAQ updates. As
providers register to report, work to understand their requirements under
terms and conditions, and prepare their reports to document their eligibility and appropriate
use of funds, McGuireWoods stands ready to assist with any questions about
this updated information. McGuireWoods will also continue to monitor
developments regarding reporting and auditing for those who received
Provider Relief Fund payments.
McGuireWoods has published additional thought leadership analyzing how
companies across industries can address crucial
business and legal issues related to COVID-19.