Alerts

The CARES Act provides $100 billion in relief funds to hospitals and other healthcare providers on the front lines of the coronavirus response. Beginning April 10, 2020, $30 billion in payments began arriving to eligible providers by direct deposit or check. These are payments, not loans, to healthcare providers, and will not need to be repaid if the terms and conditions are met.

Who is eligible for initial $30 billion?

• All facilities and providers that received Medicare fee-for-service (FFS) reimbursements in 2019 are eligible for this initial rapid distribution.
• Payments to practices that are part of larger medical groups will be sent to the group’s central billing office.
• All relief payments are made to the billing organization according to its Taxpayer Identification Number (TIN).
• As a condition to receiving these funds, providers must agree not to seek collection of out-of-pocket payments from COVID-19 patients that are greater than what the patients would have otherwise been required to pay if the care had been provided by an in-network provider.
• Providers that ceased operations as a result of the COVID-19 pandemic, are still eligible to receive funds so long as they provided diagnoses, testing, or care for individuals with possible or actual cases of COVID-19. Care does not have to be specific to treating COVID-19. HHS broadly views every patient as a possible case of COVID-19.

How are payment distributions determined?

• Providers will be distributed a portion of the initial $30 billion based on their share of total Medicare FFS reimbursements in 2019. Total FFS payments were approximately $484 billion in 2019.
• A provider can estimate their payment by dividing their 2019 Medicare FFS (not including Medicare Advantage) payments they received by $484,000,000,000, and multiplying that ratio by $30,000,000,000. Providers can obtain their 2019 Medicare FFS billings from their organization’s revenue management system. As an example: A community hospital billed Medicare FFS $121 million in 2019. To determine how much this hospital would receive, use this equation: $121,000,000/$484,000,000,000 x $30,000,000,000 = $7,500,000.

What to do if you are an eligible provider?

• HHS has partnered with UnitedHealth Group (UHG) to provide rapid payment to providers eligible for the distribution of the initial $30 billion in funds. Providers will be paid via Automated Clearing House account information on file with UHG or the Centers for Medicare & Medicaid Services (CMS).
• The automatic payments will come to providers via Optum Bank with “HHSPAYMENT” as the payment description. Providers who normally receive a paper check for reimbursement from CMS, will receive a paper check in the mail for this payment within the next few weeks.
• Within 30 days of receiving the payment, providers must sign an attestation confirming receipt of the funds and agreeing to the Terms and Conditions – PDF. Not returning the payment within 30 days of receipt will be viewed as acceptance of the Terms and Conditions. If the provider decides to reject the Terms and Conditions, the provider must contact HHS within 30 days of receipt of payment and then remit the full payment to HHS as instructed. The CARES Act Provider Relief Fund Payment Attestation Portal will guide providers through the attestation process to accept or reject the funds.

Different Types of Providers:

• Large Organizations and Health Systems: Large organizations will receive relief payments for each of their billing TINs that bill Medicare. Each organization should look to the part of their organization that bills Medicare to identify details on Medicare payments for 2019 or to identify the accounts where they should expect relief payments.
• Employed Physicians: Employed physicians should not expect to receive an individual payment directly. The employer organization will receive the relief payment as the billing organization.
• Physicians in a Group Practice: Individual physicians and providers in a group practice are unlikely to receive individual payments directly, as the group practice will receive the relief fund payment as the billing organization. Providers should look to the part of their organization that bills Medicare to identify details on Medicare payments for 2019 or to identify the accounts where they should expect relief payments.
• Solo Practitioners: Solo practitioners who bill Medicare will receive a payment under the TIN used to bill Medicare.

Next up…. priorities for the remaining $70 billion:

Stay tuned. The Administration is working distributions that will focus on providers in areas particularly impacted by the COVID-19 outbreak: rural providers, providers of services with lower shares of Medicare reimbursement, providers that predominantly serve the Medicaid population, and providers requesting reimbursement for the treatment of uninsured Americans.

Vincent Farisello
(203) 578-4284; vfarisello@carmodylaw.approvalserver.com

Trudie R. Hamilton
(203) 575-2615; thamilton@carmodylaw.approvalserver.com

David S. Hardy
(203) 784-3199; dhardy@carmodylaw.approvalserver.com

Tamara M. Nyce
(203) 578-4275; tnyce@carmodylaw.approvalserver.com

Ann H. Zucker
(203) 252-2652; azucker@carmodylaw.approvalserver.com