HHS to Begin Immediate Delivery of Initial $30 Billion of CARES Act Provider Relief Funding for Medicare Providers

No Action Required for All Medicare Providers to Receive Funds – But Significant Conditions on Use of Funds Must be Followed

On Thursday, April 9, The U.S. Department of Health and Human Services provided details of the release of $30 billion of funds to Medicare Part A and Part B providers authorized by the CARES Act. This $30 billion comes out of the $100 billion total appropriated under the CARES Act into the Public Health and Social Services Emergency Fund to assist healthcare providers by covering otherwise unreimbursed healthcare-related expenses or lost revenue attributable to the COVID-19 crisis. This is a grant program that does not require repayment, and is separate from the Medicare Advanced and Accelerated Payment Program announced by the Centers for Medicare and Medicaid Services a couple of weeks ago. 

The $30 billion funding tranche will be disbursed to Medicare Part A and Part B providers based on their 2019 Medicare fee-for-service billings. Payments will be delivered automatically beginning on April 10th via direct deposit to the billing provider’s bank account already on file with Medicare. This payment should be equal to just over 6% of a provider’s 2019 Medicare fee-for-service billings, and will come to providers through an automated deposit from Optum Bank with “HHSPAYMENT” as the payment description. Providers who receive Medicare reimbursement manually will receive a check via mail for this payment as well, within the next few weeks.

While no action is required to receive this provider relief payment, there are substantial terms and conditions to the receipt of these funds that must be adhered to. Among these terms and conditions are:

  1.  The provider currently provides diagnosis, testing, or care for individuals with possible or actual cases of COVID-19; is not currently terminated from participation in Medicare; is not currently excluded from participation in Medicare, Medicaid, and other Federal health care programs; and does not currently have Medicare billing privileges revoked.
  2.  The provider certifies that the Payment will only be used to prevent, prepare for, and respond to coronavirus, and that the Payment is only for health care related expenses or lost revenues that are attributable to coronavirus.
  3.  The provider certifies that it will not use the Payment to reimburse expenses or losses that have been reimbursed from other sources or that other sources are obligated to reimburse.
  4.  The provider shall maintain documentation and submit any reports required to show the funds are being used only for their appropriate purpose.
  5.  The provider must certify that for COVID-19-related care, it will not seek to collect from the patient out-of-pocket expenses in an amount greater than what the patient would have otherwise been required to pay if the care had been provided by an in-network provider.
  6.  The provider must certify that the funds are not being used for executive pay, lobbying, provision of abortion services, the promotion of legalizing controlled substances, and embryo research

Providers will be required to attest to their receipt of the funds and agreeing to the terms and conditions of payment via an online portal that will be opened during the week of April 13, 2020. This attestation (or return of the funds if the provider declines to accept the terms and conditions) will be required within 30 days of the provider’s receipt of payment.

While the substantial payment involved with this CARES Act- authorized provider relief will be welcome news for the many healthcare providers struggling on the frontlines of the COVID-19 crisis, we recommend that you carefully review the terms and conditions associated with these payments. Providers who accept payment and attest to these terms and conditions but are later unable to substantiate that these funds were utilized for their authorized purpose- helping to offset revenue loss or additional expenses directly attributable to the COVID-19 crisis- may be subject to significant civil and criminal penalties, as well as exclusion from the Medicare program.

Full details regarding this program are available at: https://www.hhs.gov/about/news/2020/04/10/hhs-to-begin-immediate-delivery-of-initial-30-billion-of-cares-act-provider-relief-funding.html