On January 15, the U.S. Department of Health and Human Services (HHS) released several communications related to reporting for Provider Relief Fund (PRF) payments. The first item released related to the opening of the reporting portal and related deadlines. Initially, the portal was scheduled to open on January 15 and providers would have until February 15 to complete reporting for the calendar year 2020. However, due to the passage of the Coronavirus Response and Relief Supplemental Appropriations Act (CRRSA), the portal opened on January 15, 2021 for registration only. The revised deadline for actual reporting has not been announced. HHS has also indicated that CARES Act Phase 3 funding could continue for first several months of 2021.
An updated Post-Payment Notice of Reporting Requirements was also released to incorporate the provisions of the CRRSA. While many aspects of this notice have not changed from previous notices — including the requirement to use PRF payments for expenses first and then lost revenue — there are two important changes noted.
Lost revenue
The revised guidance broadens the definition of lost revenue. Prior to issuance, the only accepted method was to compare 2020 actual revenue to 2019 actual revenue.
The notice now also allows providers to compare 2020 actual revenue to budget to determine lost revenue, if the budget was adopted prior to March 27, 2020. If the budget option is utilized, a copy of the budget will have to be submitted along with an attestation from the Chief Executive Officer, Chief Financial Officer, or similar responsible individual that the exact budget submitted was established and approved prior to March 27, 2020.
In addition, the notice allows a provider to calculate lost revenue using an alternative methodology. With this, the reporting entity must submit a description of the methodology, explanation of why the methodology is reasonable, and explanation of why lost revenue was attributable to coronavirus as opposed to a loss caused by another source. It was also noted that providers electing this method risk an increased likelihood of an audit by the Health Resources and Services Administration (HRSA). If HRSA finds the methodology unreasonable, the provider will have 30 days to resubmit using the prior year or budgeted comparison.
Targeted distributions
The January 15 notification also provides additional guidance in relation to the portability of targeted distributions.
The notice clarifies that targeted distributions may be transferred from a recipient subsidiary taxpayer identification number (TIN) to another subsidiary through a parent. This will allow for additional flexibility in the use of targeted distributions based on need. The notice also indicated that the transfer of targeted distributions between subsidiaries may face an increased likelihood of audit by HRSA. The January 15 notification doesn’t specifically address entities with common control that may not be structured as parent and subsidiary.
Previous guidance allowed for transfer of general distributions from recipient entities to meeting the following criteria: parent of one or more subsidiary billing TINs that received a general distribution, has providers associated with it that were providing diagnoses, testing, or care for individuals with possible or actual cases of COVID-19 on or after January 31, 2020, and is an entity that can otherwise attest to the terms and conditions. This guidance is unchanged.
In addition, shared general distributions will still be reported at the parent level, while shared targeted distributions will still be reported by the original recipient entity.
Our healthcare experts are monitoring updates on CARES Act and CRRSA guidance and reporting requirements. In the meantime, if you have any questions, please reach out to us.
