Keeping Up With Provider Relief Reporting & Repayment Guidance

Since the onset of the COVID-19 pandemic, there have been several funding sources available to home medical equipment (HME) providers. Many of the options can be completely forgiven if used properly, while others will need to be repaid. Some money was sent automatically without providers requesting it, while other relief funds required providers to complete an application process. While these resources have helped many businesses survive the pandemic, there is some additional work associated with most of the programs.

Provider Relief Fund

One of the more commonly used funding sources was the Department of Health and Human Services (HHS) and Health Resources & Services Administration (HRSA) Provider Relief Fund (PRF). The PRF has allocated more than $186 billion to be distributed to various provider types since April 2020 and has been replenished a few times through various pieces of legislation, including the CARES Act and the American Rescue Plan, among others.

Between April and November 2020, there were three phases of the PRF. The funds that providers received through this program did not need to be paid back as long as the funding was used as intended and according to the program’s terms and conditions. If you want to avoid being required to return those funds, it is imperative that you know and understand the expectations for how to use and report on the use of those funds. The window for providers to begin submitting their reports opened July 1, and providers must complete their reports by specific deadlines to avoid paying the money back.

Providers who received payments totaling more than $10,000 in any of the four payment windows (see details in the box at left) will be required to submit reports. If you received more than $10,000 during multiple payment windows, you will be required to submit multiple reports. Providers are not required to submit reports for periods in which they did not receive at least $10,000.

During the reporting process, providers must be able to prove that all of the funds they received were used on either certain approved expenses or to make up for lost revenues attributable to COVID-19. There are two types of expense types:

1. General & administrative expenses include:

• Mortgage and/or rent
• Insurance
• Personnel
• Fringe benefits
• Lease payments
• Utilities or operations

2. Health care-related expenses include:

• Supplies
• Equipment
• Information technology
• Facilities

In the reporting portal, PRF dollars received by providers will first be offset by those two expense categories. If the expenses incurred do not fully exhaust the funds received, lost revenues will then be considered to offset the remainder of the funds. To calculate lost revenues, providers can utilize one of three methods:

They can compare actual 2019 revenue to actual 2020 revenue.

They can compare budgeted 2020 revenue to actual 2020 revenue. To use this option, providers must prove that a budget was created and adopted by the reporting entity’s appropriate corporate officer(s) before March 27, 2020.

The provider can choose an alternative reasonable methodology. If selecting this method, a provider will submit their alternative methodology for calculating lost revenues, and HRSA will review the proposed methodology using their own discretion and will notify a reporting entity if their proposed methodology is not considered reasonable. The review process will consider whether the proposal demonstrates with a reasonable certainty that claimed lost revenues were caused by the pandemic. If HRSA determines that a reporting entity’s proposed alternate methodology is not reasonable, the entity will be asked to resubmit their report within 30 days using one of the other two methods outlined above.

There are two recent developments with the HHS PRF. First, for funds received during Period 1, the deadline remains Sept. 30, 2021. However, HRSA has announced a 60-day grace period for providers who cannot attain compliance by Sept. 30. Those providers will have 60 days to become compliant; if they fail, they will face recoupment of the PRF funds they received.

Second, on Sept. 10, 2021, HHS announced that a fourth phase of funding would be available to providers beginning Sept. 29, 2021. At press time, there were very few details available as to whether the funds would be available to all provider types in all areas. Certain provider types have been excluded from specific phases in the past. For example, in Phase 3 of the PRF, HME providers were excluded from eligibility, even though they were included in Phase 1 and Phase 2. What is known is that in Phase 4, there will be $25.5 billion dollars available to providers, and that the funding is intended to go to:

• providers who serve rural Medicaid, Children’s Health Insurance Program or Medicare patients
• providers who can document revenue loss and expenses associated with the pandemic
• providers who serve vulnerable communities
• providers who operate on thin margins and often serve vulnerable, isolated and/or rural communities

Phase 4 payments will be based on providers’ lost revenues and expenditures between July 1, 2020, and March 31, 2021. More details should be available in October, and you can find those as well as all other PRF program details online at hrsa.gov/provider-relief

Medicare Advance Payments

Much like the HHS PRF, the Centers for Medicare & Medicaid Services’ COVID-19 Accelerated or Advance Payment (CAAP) program was created in response to the public health emergency. For this program, however, providers had to apply to receive funds, which are not forgivable and therefore must be paid back. For more information on this program, please visit cms.gov/medicare/covid-19-accelerated-and-advance-payments.

Repayment Timeline:

• Repayment begins one year from the issue date. For the first 11 months, Medicare payments owed to providers will be recouped at a rate of 25%.
• After those 11 months, Medicare payments owed to providers will be recouped at a rate of 50% for the next six months.
• After 17 months, if there are still funds that have not been recouped or repaid, the provider will be notified that the remainder must be repaid within 30 days. If the provider fails to do that, 4% interest will begin to accrue.

Please make sure you are doing everything you can to remain in compliance with the programs outlined above so that you can continue to care for the patients you serve.

TIMING FOR REPORTING

Period 1:
For payments received between April 1, 2020, and June 30, 2020, all funds must have been used by June 30, 2021.

Your final use of funds report must be submitted between July 1, 2021, and Sept. 30, 2021; however, there has been a 60-day extension for certain criteria.

Period 2:
For payments received between July 1, 2020, and Dec. 31, 2020, all funds must have been used by Dec. 31, 2021.

Your final use of funds report must be submitted between Jan. 1, 2022, and March 31, 2022.

Period 3:
For payments received between Jan. 1, 2021, and June 30, 2021, all funds must be used by June 30, 2022.

Your final use of funds report must be submitted between July 1, 2022, and Sept. 30, 2022.

Period 4:
For payments received between July 1, 2021, and Dec. 31, 2021, all funds must be used by Dec. 31, 2022.

Your final use of funds report must be submitted between Jan. 1, 2023, and March 31, 2023.