Healthcare Provider COVID-19 Relief Funding - $25.5 Billion Available

By Chirico Rozsa, CPA on September, 22 2021
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Chirico Rozsa, CPA

Audit Senior Manager | Healthcare

Healthcare Funding

On September 10, 2021, Heath and Human Services (HHS) announced the availability of an additional $25.5 billion of funding for health care providers. Included in the package is $17 billion of additional Provider Relief Funds (PRF) for a Phase 4 tranche, as well as $8.5 billion in American Rescue Plan (ARP) funding. On September 29, 2021, providers can begin their application process.

What are these COVID-19 relief funds for?

The Phase 4 distribution is meant to continue funding lost revenues and COVID-19 related operating expenses incurred between July 1, 2020 and March 31, 2021. This specific distribution is designed to provide additional support to smaller providers by reimbursing a higher percentage of lost revenues and COVID-19 related expenses as compared to larger providers.

The ARP funding is targeted to assist providers who service Medicaid/CHIP and Medicare beneficiaries living in rural areas as defined by the Federal Office of Rural Health Policy. Similar to the Phase 4 funding, the ARP is designed to provide additional support to providers that service Medicaid/CHIP patients, by utilizing the oftentimes higher Medicare reimbursement rates.

How do I know if my healthcare organization is considered ‘rural’?

Health Resources & Services Administration (HRSA) has provided an online tool that will assist providers in determining whether their organization can be considered. Click here for the HRSA eligibility analyzer.

What kinds of healthcare providers are eligible for this COVID-19 relief?

While acute care hospitals and skilled nursing facilities are the most thought of ‘providers’, any provider or supplier of health care is eligible.

What should my organization be doing?

Prior to the application process, HHS recommends that your organization gathers any supporting information such as recent tax documents and financial statements related to the second half of 2020 and first quarter of 2021.

Does my organization need to apply for PRF and ARP separately?

No. HRSA is allowing providers to apply for both payment streams in a single application.

Freed thoughts

Although HHS has not released official guidance regarding what these funds may be used for, signs point to them following the same terms and conditions from Phases 1-3 of the PRF General Distributions. Therefore, if you have any lost revenue and/or increased expenses that will not be covered by the funding you have already received from HHS, FEMA, PPP, and other sources, we recommend that you apply.

If you have any questions or need additional guidance, Freed Maxick Healthcare can help. Please contact Chirico Rozsa at 716.847.2651 or utilize our contact form.

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