News & Insights
Apr 2, 2020
In an effort to mitigate the spread of the coronavirus, conserve medical supplies and prepare for and address the surge of COVID-19 patients, hospitals and other healthcare providers took a number of steps in recent weeks, including:
These moves have placed unbearable economic strain on the full spectrum of healthcare providers. Financial assistance is clearly needed to support the healthcare industry’s fight against COVID-19.
Toward the end of the $2 trillion Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), in Title VIII, is a provision funding the Public Health and Social Services Emergency Fund (“Emergency Fund”) account appropriated to the Department of Health and Human Services (“HHS”) in the amount of $100 billion. This funding is much needed relief for hospitals and systems on the front-line of the COVID-19 response, and economic relief for providers, and potentially other organizations, which have suffered lost revenue as a result of the virus.
"The $100 billion fund is for the benefit of 'eligible healthcare providers for healthcare-related expenses or lost revenues that are attributable to coronavirus.'”
Eligible healthcare providers are: (1) public entities, Medicare or Medicaid enrolled suppliers and providers, and (2) other for-profit and non-profit entities, as specified by the Secretary, that provide diagnoses, testing, or care for actual or potential COVID-19 individuals.
Providers may not seek reimbursement for expenses reimbursed through other sources. Funds are available for (1) use for building or construction of temporary structures, leasing of properties, medical supplies and equipment including personal protective equipment and testing supplies, increased workforce and trainings, emergency operation centers, retrofitting facilities, and surge capacity, or (2) lost revenues attributed to the virus. Application of need and a TIN is required.
The Emergency Fund is an account for HHS authorized by the public health emergency powers of the Public Health Service Act.
A timely amendment of the law in 2019, through the Pandemic and All-Hazards Preparedness and Advancing Innovation Act of 2019, provides for HHS’ use of this Emergency Fund for rapid response to immediate needs of a public health emergency. The account’s administrator, HHS’ Assistant Secretary for Preparedness and Response (ASPR), is given substantial discretion in the amount, timing and process for distribution of the Fund and the CARES Act provides for a rolling review of applications and distribution.
Other than the amount of the fund, some minimal parameters, and required HHS reporting to Congress and auditing obligations, not much else is known at this time regarding when and how the funds will be made available to ease the significant financial impact that COVID-19 response has placed on healthcare providers. Applications for reimbursement under the Fund may provide additional information regarding the criteria. In the meantime, healthcare providers should document all financial expenses attributed to the virus, such as, lost revenues associated with canceled appointments and furloughed employees, additional hiring and facility expansion, additional medical supplies and equipment, and construction or retrofitting costs. Since payments may be both prospective and retroactive, monitoring and documenting costs and expenses is recommended to support any application for funding.
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