Reporting HHS Provider Relief Funds: An Important Update
Originally published on November 3, 2020
Updated on August 16th, 2022
As the Provider Relief Fund (PRF) program evolves, the reporting process for these funds has gotten complicated. Our previous article on the subject detailed several aspects of use and reporting under the PRF. Here are the latest updates from the U.S. Department of Health and Human Services (HHS) on these funds.
New Reporting Requirements
On Sept. 19, 2020, the HHS released the General and Targeted Distribution Post-Payment Notice of Reporting Requirements for the PRF. In addition to a quick reference guide of the reporting requirements for PRF recipients, the agency provides a detailed summary of these requirements for recipients and when these funds may be subject to an audit.
HHS has changed the method of determining lost revenue, including the categories to be reported. There is also a new section related to capturing nonfinancial data, such as facility, staffing and patient information.
PRF recipients can submit healthcare-related expenses attributable to coronavirus that have not been reimbursed by another source and/or are not obligated to be reimbursed by another source. This includes general and administrative costs as well as healthcare-related operating expenses.
PRF payments not fully spent on healthcare-related expenses stemming from coronavirus are then applied to lost revenues.
Calculating Lost Net Patient Revenue
As of Oct. 22, 2020, HHS has gone back to its previous requirement to report lost revenue rather than operating income as the method to determine lost revenue for PRF. Per the agency, these are the requirements:
Reporting entities must provide information used to calculate lost revenues attributable to coronavirus, represented as a negative change in year-over-year actual revenue from patient care related sources. Revenues and expenses in this section include all lost patient care revenues and patient care cost/expense impacts.
Total Revenue/Net Charges from Patient Care Related Sources (2019 and 2020): Revenue/net charges from patient care (prior to netting with expenses) for the calendar years 2019 and 2020. Calendar year actual revenues will be entered by quarter (e.g., Jan.–March 2019, April–June 2019, etc.).
Note: Reporting entities with unused funds after Dec. 31, 2020, must submit a second and final report no later than July 31, 2021 that includes patient care related revenue amounts earned Jan. 1– June 30, 2021.
Revenue from Patient Care Payer Mix (2019 and 2020):
- Medicare Part A+B: Actual revenues/net charges received from Medicare Part A+B for patient care for the calendar year.
- Medicare Part C: Actual revenues/net charges received from Medicare Part C for patient care for the calendar year.
- Medicaid: Actual revenues/net charges received from Medicaid/Children’s Health Insurance Program (CHIP) for patient care for the calendar year.
- Commercial Insurance: Actual revenues/net charges from commercial payers for patient care for the calendar year.
- Self-Pay (No Insurance): Actual revenues/net charges received from self-pay patients, including the uninsured or individuals without insurance who bear the burden of paying for healthcare themselves, for the calendar year.
- Other: Actual gross revenues/net charges from other sources received for patient care services and not included in the list above for the calendar year
Classification of Other Assistance and Expenses
The HHS goes into further detail about how to classify other assistance you might have received. The provider must identify the following:
Any tTreasury, Small Business Administration (SBA) and CARES Act/Paycheck Protection Program (PPP) proceeds: Report the total amount of coronavirus-related relief received from Treasury, SBA, and CARES Act/PPP by the Reporting Entity as of the reporting period end date, including the following.
- FEMA CARES Act: Total amount of coronavirus-related relief received from FEMA by the Reporting Entity as of the reporting period end date.
- CARES Act Testing: Total amount of relief received from HHS for coronavirus testing-related activities.
- Local, State, and Tribal Government Assistance: Total amount of coronavirus-related relief received from other Local, State, or Tribal government sources by the recipient and its included subsidiaries as of the reporting period end date.
- Business Insurance: Paid claims against insurance policies intended to cover losses related to various types of healthcare business interruption as of the reporting period end date.
- Other Assistance: Total amount of other federal and/or coronavirus-related assistance received by the recipient and the other TINs included in its report as of the reporting period end date.
Additionally, total calendar year expenses for 2019 and 2020 are to be placed in the following categories, with quarterly breakdown (for example, January through March 2019, April through June 2019, etc.):
- General and Administrative Expenses (2019 and 2020): G&A expenses may include items such as monthly payments related to mortgage or rent for facility where reporting entity provides patient care services, other monthly finance charges for real property and/or property taxes, insurance premiums for property, employee health insurance, or malpractice insurance, overhead salaries, healthcare and contractor salaries, fringe benefits, lease payments, lighting, cooling/ventilation, cleaning, vendor services purchased from third party vendors, consulting support, legal fees, audit and accounting services, food preparation and supplies, logistics and transport or other costs not captured above, such as debt financing, for the relevant calendar year.
- Healthcare Related Expenses (2019 and 2020): Healthcare related expenses may include items such as supplies, equipment, IT, facilities, employees, and other healthcare related costs/expenses for the relevant calendar year.
The most recent guidance from HHS has a series of new key reporting dates.
- January 15, 2021: Reporting system opens for providers.
- February 15, 2021: First reporting deadline for all providers on use of funds.
- July 31, 2021: Final reporting deadline for providers who did not fully expend PRF funds prior to Dec. 31, 2020 to report expenses through June 30, 2021.
The reporting requirements apply to PRF General and Targeted Distributions and not HRSA Uninsured Program payments, the Nursing Home Infection Control distribution, or the Rural Health Clinics Testing distribution. HHS PRF reporting will include reporting of the following:
- Healthcare-related expenses attributable to coronavirus including:
- General and administrative
- Healthcare-related operating expenses
- PRF payment amounts not fully expended on the above are then applied to patient care lost revenues (net of the healthcare related expenses attributable to coronavirus calculated under step 1). Recipients may apply PRF payments toward lost revenue up to the amount of the difference between their 2019 and 2020 actual patient care revenue.
Entities that received between $10,000 and $499,999 in aggregated PRF payments are required to report more summarized information. Recipients of $500,000 or more must provide more detailed information broken down by sub-categories.
Revenue and expense information will be reported by quarter for calendar years 2019 and 2020. Revenue will be reported by payer, whereas expenses will be reported by category. Additional nonfinancial data will be collected, including personnel, patient and facility metrics.
Recipients will also report on the amount of other financial assistance received from other sources including SBA PPC loans, FEMA CARES Act assistance and CARES Act Testing assistance.
Organizations that expend $750,000 or more in aggregated federal financial assistance during their fiscal year are subject to single audit requirements per 45 CFR 75.501.
Tracking COVID Expenses and Lost Revenue
The PRF attestation requires certain financial management standards, including record retention requirements and tracking of funding stream expenditures. Providers will need to develop policies and procedures and then communicate them to staff so that they can identify, document and report allowable expenses and lost revenue.
For expense tracking, you might need to develop additional accounts or classifications for each funding source. The related documentation will also need to be retained for reporting and audit purposes.
It is important to track each funding source and the related expenditures so this information can be used in January of 2021 when the reporting portal becomes available. Processes should be developed for both external and internal reports.
Maintaining Source Information
It is important to retain sources for the guidance used to build out processes and determine allowable costs by programs and reporting requirements. This includes maintaining website information and the date the site was accessed as this information is constantly being updated.
You should also check government websites frequently for updated and emerging information. This allows you to proactively modify policies, procedures, and workflows to maintain compliance with program and funding requirements.
To avoid reporting the same expenditures to multiple funding sources, allocate each expense account balance over the multiple funding sources to provide evidence that you haven’t used the expense more than once. Share the guidance available from HHS to all accounting staff and others so it can be used to identify expenditures related to each funding source. Establish checklists or accounting manuals to assist staff with determining proper accounting procedures and the importance of maintaining documentation.
As we stated earlier, reporting HHS Provider Relief Fund money is painstakingly complex. We strongly recommend you enlist the help of your healthcare CPA to guide you through the process.
All content provided in this article is for informational purposes only. Matters discussed in this article are subject to change. For up-to-date information on this subject please contact a James Moore professional. James Moore will not be held responsible for any claim, loss, damage or inconvenience caused as a result of any information within these pages or any information accessed through this site.
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