• Press Release
• HHS Secretary Alex Azar’s Remarks
• CARES Act Provider Relief Website
• CARES Act Provider Relief Fund Application Guide
• General Distribution Portal FAQs
• COVID-19 Claims Reimbursement for Testing and Treatment to Health Care Providers and Facilities Serving the Uninsured
• McDermottPlus Coronavirus Resource Center
   

HHS will also distribute funds to certain high-impact sectors, including $10 billion to hospitals in areas that have been particularly affected by the COVID-19 outbreak, $10 billion to rural health clinics and hospitals, and $400 million to Indian Health Service facilities.

Hotspots

HHS allocated $10 billion to hospitals in areas highly affected by the COVID-19 outbreak. In order to account for uninsured and low-income patients and the disproportionate burden of COVID-19 on minority communities, the distribution of these funds will also take into account facilities’ Medicare Disproportionate Share Hospital adjustment. To receive these funds, hospitals were required to provide information through an authentication portal by 3:00 PM ET on April 25, 2020. Hospitals applying for these funds reported their total number of intensive care unit beds as of April 10, 2020 and total number of admissions with a positive diagnosis for COVID-19 from January 1 to April 10, 2020. Because New York accounts for 40% of US COVID-19 cases, HHS anticipates that $4 billion will go to New York hospitals.

Rural Health Clinics and Hospitals

HHS will distribute $10 billion to rural health clinics and rural hospitals as early as the week of April 27. HHS will use operating expenses as the methodology to proportionately distribute payments to each facility and clinic. HHS likely will use Medicare cost reports as a basis for determining operating expenses. HHS indicated that these funds will go to entities including approximately 1,100 affiliated rural health clinics and more than 1,300 freestanding rural health clinics.

It remains unclear how HHS is defining “rural” for purposes of this distribution. HHS agencies and programs deploy at least a half-dozen different definitions of the term. The definition HHS adopts will be key, and may leave some providers excluded and frustrated.

This $10 billion is in addition to the $165 million that the Health Resources and Services Administration awarded through CARES Act funding to support rural communities.

Even prior to the COVID-19 crisis, the financial outlook of rural hospitals and clinics was bleak, with a record number of rural hospital closures in 2019. Rural hospital profit margins are about half those of urban hospitals, and many rural hospitals run on negative margins. This precarious financial position renders them especially vulnerable at this time, making them a priority healthcare sector for HHS and Congress.

Indian Health Service Facilities

HHS will distribute $400 million to Indian Health Service facilities. This funding will be distributed as early as the week of April 27, on the basis of facility operating expenses. In allocating this funding to the Indian Health Service, HHS acknowledged that COVID-19 is severely affecting the Native American population and straining their already beleaguered health system capacity.

Reimbursement Process for Services to Uninsured Established

The Families First Coronavirus Response Act appropriated $1 billion to reimburse providers for the costs of COVID-19 testing and treatment for uninsured individuals. President Trump had previously said that a portion of the Fund would be used to pay for the treatment of COVID-19 healthcare-related expenses of uninsured patients. Estimates indicate that the costs of covering testing and treatment for the uninsured are significant, even as COVID-19’s full effect remains unclear. For example, the Kaiser Family Foundation estimates that the cost of treating the uninsured could range from $13.9 billion to $41.8 billion.

This week, HHS established the Health Resources Service Administration (HRSA) COVID-19 Uninsured Program to process COVID-19 claims for uninsured patients. Eligible healthcare providers that have conducted testing or provided treatment for uninsured COVID-19 patients on or after February 4, 2020, will be able to request claims reimbursement electronically and will be reimbursed generally at Medicare rates, subject to available funding. Providers will receive payment via direct deposit. On April 27, 2020, HHS will launch a new COVID-19 Uninsured Program Portal for these submissions.

Faced with the challenge of distributing the Fund to providers with little instruction from Congress, HHS looked to quickly distribute money to a wide range of affected providers. To accomplish this, HHS is using formula-driven distributions. While that approach has the advantage of being expedient, it has the disadvantage of leaving certain providers behind. With a substantial amount of funding remaining in the Fund, it remains to be seen how HHS will reach providers who have not yet received any funds, and continue to provide relief for those who have received funds that are inadequate against need.

Even with four significant relief packages on the books, many physicians, hospitals and other providers will need additional relief from the economic toll of COVID-19. Avenues for immediate financial relief have been somewhat limited – primarily the Accelerated and Advance Payments (AAP) Program (which allows Part A and B providers and suppliers to receive pre-payment of Medicare claims) and the Paycheck Protection Program (PPP). Each of these options have limitations – the AAP is a loan that must be paid back and if it is not paid back on the prescribed timeline, a high interest rate attaches. Many health care providers are unable to qualify for the PPP because of size thresholds and affiliation rules. Congress is currently adjourned until May 4^th, so stakeholders have some time to assemble their requests for another round of stimulus efforts.