On September 10, 2021, the U.S. Department of Health & Human Services (HHS) announced a Phase 4 General Distribution of Provider Relief Funds as well as additional resources for the American Rescue Plan. Eligible providers can begin applying on September 29th.
Provider Relief Funds (PRF) are grants to healthcare providers and do not need to be repaid if the recipient follows the associated “terms and conditions.” The terms and conditions include requirements related to eligibility, use of funds, balance billing and other conditions. Recipients must provide detailed reports regarding how the funds are used.
Per the HHS Press Release, the additional Phase 4 funding provides $17 billion to assist providers that can document revenue loss and expenses associated with the pandemic. In addition, $8.5 billion in American Rescue Plan (ARP) resources are available for providers who serve rural, Medicaid, Children’s Health Insurance Program (CHIP), or Medicare patients.
PRF Phase 4 payments will be based on providers’ lost revenues and expenses between July 1, 2020 and March 31, 2021. According to HHS, Phase 4 payments will reimburse smaller providers at a higher rate than larger providers and include bonus payments for providers who serve Medicaid, CHIP, and/or Medicare patients, who tend to be lower income and have greater and more complex medical needs.
Providers can apply for both the PRF and ARP programs in one application, and the Health Resources and Services Administration (HRSA) will use existing Medicaid/CHIP and Medicare claims data to calculate payments.
Additionally, PRF recipients will be required to notify the HHS Secretary of any merger with, or acquisition of, another health care provider during the period in which they can use the payments, to ensure provider funds are used for patient care.
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