New Provider Relief Guidance Outlines Use of Funds, Reporting and More

June 22, 2021 | Article

The “once again” anticipated update to the Provider Relief Funds (PRF) reporting requirements was released on June 11, 2021. This new guidance supersedes the previous guidance from January 15, 2021.

The new guidance provides timelines for use of funds and reporting, as well as tweaks to allowable expenditures and lost revenues. It also incorporates the Skilled Nursing Facilities (SNF) and Nursing Home Infection Control distributions into the reporting requirements.

An update to the FAQ document was also dated June 11, 2021, and aligns many previous FAQs with the new guidance and adds a few new items. The full reporting requirement document can be found here.

Use of Funds and Reporting Deadlines Under New Provider Relief Fund Guidance

The most highly anticipated changes relate to the timeline for using funds and the reporting deadlines. The determination was made that both of these items will be dependent upon the date the PRF payment was received. The date of receipt is the deposit date for ACH payments or the check cashed date. The following is a summary of the use and reporting dates:

Payment Received Period
(Payments Exceeding $10,000 in Aggregate Received)
Deadline to Use Funds Reporting Time Period
Period 1 April 10, 2020 to June 30, 2020 June 30, 2021 July 1, 2021 to September 30, 2021
Period 2 July 1, 2020 to December 31, 2020 December 31, 2021 January 1, 2022 to March 31, 2022
Period 3 January 1, 2021 to June 30, 2021 June 30, 2022 July 1, 2022 to September 30, 2022
Period 4 July 1, 2021 to December 31, 2021 December 31, 2022 January 1, 2023 to March 31, 2023

Reporting is required for any recipient of greater than $10,000 during the reporting period. For some, this may require multiple reporting periods. For entities that received significant funds prior to June 30, 2020, this means there is no extension to the deadline to use funds. It is also worth noting that there is a fourth period with payment receipts from July 1, 2021, to December 31, 2021, and verbiage used in the PRF reporting update notes that it applies to “all past and future PRF payments.” Accordingly, additional PRF payments are expected.

Reporting Entities Under New Provider Relief Fund Guidance

The “Reporting Entity” is defined relatively consistent with the previous guidance, including being segregated by type of PRF distribution received. General distribution payments may be reported by the original recipient, the final recipient or a parent entity, regardless of which entity attested to accepting the payments.

Targeted distributions, however, are required to be reported by the original recipient that attested to accepting the payments. Transferred targeted distribution payments will be a separate reporting section, if applicable. Additional information will also be required for acquired or divested subsidiaries. If the reporting entity itself was acquired or divested, that change needs to be self-reported directly to the Health Resources and Services Administration (HRSA) following the instructions in the reporting requirements document.

Eligible Expenditures Under the New Provider Relief Fund Guidance

There were minor changes to the various eligible expense categories, but the majority of this section was consistent with the January 15, 2021, guidance. If SNF and/or Nursing Home Infection Control distributions were received, however, a separate section specific to only those expenditures is required. It follows a similar outline as the PRF expense reporting requirements, except expenditures must be specific to the allowable areas outlined in the Terms and Conditions of these disbursements.

In addition, a new category titled “Net Unreimbursed Expenses Attributable to Coronavirus” is now required. This requires an entity to understand the total expenses attributable to coronavirus and not just those claimed for that reporting period. In other words, these are the expenses that are not covered by other sources or PRF.

Expenses that are paid for with PRF payments during the reporting period identified should be the amounts reported as used by PRF. As an example, assume an entity received $100,000 on April 10 and another $50,000 on July 27. The $100,000 falls into reporting Period 1 and the funds must be used by June 30, 2021. Assume by June 30, 2021, $140,000 of eligible expenditures were incurred. On the Period 1 reporting for the $100,000 payment, the entity would report $100,000 as eligible expenditures used by PRF and $40,000 as net unreimbursed expenses. That entity now has between June 30, 2021, and December 31, 2021, to support the remaining $10,000 ($50,000 received in July less $40,000 unreimbursed to date). Assume an additional $25,000 was spent. On the Period 2 reporting for the $50,000 payment, the entity would report $50,000 as eligible expenditures used by PRF and $15,000 as net unreimbursed expenses.

Lost Revenues under the New Provider Relief Fund Guidance

The calculation of lost revenues continues to allow for three options.

  1. First, the calculation can be the difference between actual patient care revenues. Revenue information from January 1, 2019, through the most recently completed calendar year is required to be reported and used for this first option.
  2. The second option continues to be the difference between actual patient care revenue and budgeted patient care revenue, so long as the budget was approved prior to March 27, 2020.
  3. Finally, the third option continues to be a calculation using “any reasonable method of estimating revenues.” The use of this methodology is still explicitly noted as having an increased likelihood of an audit by HRSA. Should HRSA not deem a methodology reasonable, the reporting entity will have 30 days from notification to either resubmit a calculation using the difference between actual or budgeted patient care revenue information.

The reporting requirements do note that even if all PRF funds are supported by eligible expenditures or only SNF and Nursing Home Infection Control payments were received (which cannot use lost revenues to support those amounts), revenue information by quarter for the period of availability is still required by payor categories.

Patient care revenue was further defined in the update, as follows:

“‘Patient care’ means health care, services and supports, as provided in a medical setting, at home/telehealth, or in the community. It should not include non-patient care revenue such as insurance, retail, or real estate revenues (exception for nursing and assisted living facilities’ real estate revenues where resident fees are allowable); prescription sales revenues (exception when derived through the 340B program); grants or tuition; contractual adjustments from all third-party payers; charity care adjustments; bad debt; and any gains and/or losses on investments.”

The use of the term insurance is considered to relate to revenues from providing coverage under insurance plans, rather than revenue from third-party payors that are insurers—those amounts are considered patient care revenue. In addition, noting that contractual adjustments, charity care and bad debts are excluded effectively means net revenues (similar to gross receipts) should be utilized. Other non-patient care revenue, such as forgiveness from the PPP program and other non-patient assistance is generally considered a grant and excluded from this calculation. However, there are still specific scenarios that are not yet defined.

What Else You Need to Know About New Provider Relief Fund Guidance

A section of the reporting still exists where reporting entities will need to provide the interest income earned on PRF funds. The interest earned on SNF and Nursing Home Infection Control Distribution payments must be reported separately from interest earned on other PRF payments. Finally, a new survey will be included for reporting entities to answer questions regarding the impact of payments during the period of availability in areas such as overall operations and maintenance of solvency and prevention of bankruptcy, etc.

Should PRF funds remain after applying eligible expenses and lost revenues as of the relevant deadline(s), that amount is required to be repaid. An FAQ was modified to note that providers will be able to return unused funds through the reporting portal.

The reporting portal will require information noted above, and an FAQ notes that supporting worksheets will be available to assist reporting entities with completion of reports. It is also noted that the burden of proof is on the reporting entity to ensure that adequate documentation is maintained.

It is recommended that you review and document the receipt dates of payments under this program, as this will impact not only the period of availability to use the funds, but the reporting deadlines. It is worth noting that the SNF and Nursing Home Infection Control Disbursements include Quality Incentive Program payments, so there may be numerous receipt dates and reporting periods. If you haven’t yet accumulated information on eligible expenditures, lost revenues or other reporting matters, now is the time to start, especially if funds were received prior to June 30, 2020. If you have started, it is worth reviewing information with these changes.

The program continues to issue guidance and changes. We’ll help you make sense of it all.

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