On May 19, the Department of Health and Human Services (HHS) announced that eligible providers seeking an additional payment from the Provider Relief Fund must accept the Terms and Conditions provided and submit an application by June 3, 2020. The second distribution, unlike the first, requires most providers to take action in order to receive additional funds, including submitting 2018 revenue information. Only providers that received a payment from the initial distribution of $30 billion are eligible to receive a payment from the remaining $20 billion.
HHS also updated its FAQs to include further clarification regarding eligibility for payments where the tax identification number (TIN) used for billing by a provider may have changed from 2019 to 2020 (e.g., merger, sale, change of practice). Notably, it confirmed that the person or entity associated with the billing tax identification number (TIN) (as opposed to, for example, individual providers in a group) must meet the applicable Terms and Conditions. One of the conditions for retaining the payments is that the provider treated possible or suspected COVID-19 patients after January 31, 2020; however, providers that did not may still have received a payment if it billed Medicare fee for service (FFS) in 2019. The FAQs clarified that any such provider must reject the payment if it did not treat possible or suspected COVID-19 patients after January 31, 2020 through the same TIN that was used to bill Medicare FFS in 2019.
In addition, some providers were “overpaid” when they received the initial payment because of HHS changing the allocation formula for the entire $50 billion after the first payments were already sent out. The distribution of the initial $30 billion was based on the provider’s “share” of Medicare FFS billings, whereas now the distribution of the entire $50 billion is intended to equal approximately 2% of the providers’ 2018 total net revenue. Providers who received more than that cannot apply for more, and if a provider has not yet attested to receipt of the funds, the FAQs clarify that a provider that believes it may have been overpaid must reject the entire payment and submit its revenue information so HHS can make a payment in the correct amount. It is not clear, however, what a provider should do that now believes it was overpaid but already attested to receipt of the funds.
Providers should carefully review the FAQs if they are unsure whether they are eligible for a payment, and consult with Garfunkel Wild. Providers must also carefully document how any funds are utilized. HHS has indicated it will audit providers and recoup any payments that were made in error or that exceed lost revenue or increased expenses due to COVID-19. Furthermore, failure to comply with the Terms and Conditions is also grounds for recoupment.
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