April 23, 2020

HHS Announces More Allocations of CARES Act Provider Relief Funding

In a April 22 news release, the Department of Health and Human Services (HHS) released information on the distribution of the remaining $20 billion of general health care provider relief funds, as well as another $20 billion split between high-incidence COVID-19 providers, and rural health care clinics and hospitals from the Coronavirus Aid, Relief and Economic Security (CARES) Act.

In a departure from methods that based previous CARES allocations on the facility’s Medicare fee-for-service (FFS) revenue, the distribution of general provider relief funds will be allocated proportionally according to the providers’ share of 2018 net patient revenue. This change is intended to target providers who receive a majority of their revenue from non-FFS sources, such as Medicare Advantage and Medicaid.

HHS allocated an additional $10 billion of targeted allocations to providers in COVID-19 high-impact areas. Hospitals in geographic areas that have a high incidence COVID-19 disease were invited to apply for CARES funds before an April 23 deadline.

Another $10 billion was set aside for rural health care clinics and hospitals. These funds are to be distributed as early as the week of April 27 on the basis of operating expenses, using a methodology that distributes payments proportionately to each facility. This approach recognizes the precarious financial positions of many rural clinics and hospitals, which were under duress even before providing costly emergency, intensive care and in-patient services to their coronavirus patients.