The Federal Appropriations Act (the act) was signed into law on December 27, 2020. The act authorizes the US Department of Health and Human Services (HHS) to distribute an additional $3 billion in Provider Relief Fund (PRF) payments, while increasing flexibility around how providers can use these funds.

HHS also released updated reporting requirements (the update) reflecting changes from the act, other revisions and portal registration information, and navigation guidance.

Below, we cover key changes to PRF reporting guidance and use of funds.

Key Impacts

The act and the update impact PRF in the following notable ways:

• Introduce additional PRF funds. HHS is authorized to distribute up to $3 billion in additional PRF payments.
• Expand lost-revenue calculation. There’s now additional flexibility around lost revenue calculation, including allowing providers to apply the budget-to-actual comparison. Budgets must have been enacted and approved by March 27, 2020, to qualify.
• Authorize use of additional lost-revenue calculations. Additional calculations may be used if they’re reasonable and attribute lost revenues to COVID-19 (coronavirus). Alternate methodologies may come with increased audit risk.
• Potentially limit the scope of health care-related expenses. HHS has narrowed the footnote definition of general and administrative expenses attributable coronavirus, including removing the reference to maintaining health care delivery capacity.
• Increase PRF transfer flexibility. The changes grant providers new flexibility in how they may distribute received PRF funds across affiliated entities, including allowing transfer of Targeted Distributions among affiliates.
• Update reporting timeline. HHS opened a reporting portal as planned on January 15, 2021; however, the February 15, 2021, first-reporting due date was pushed out.

by Brian Conner, Partner, Melaney Scott, Senior Manager, and Georgia Green, Manager, Health Care Consulting Services – MOSS ADAMS

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