Under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), the Health Resources and Services Administration (HRSA) of the Department of Health and Human Services (HHS) is authorized to distribute funds from its Provider Relief Fund (PRF) to certain providers. These providers can then use the funds to support COVID-19 prevention, preparedness, and response, or to alleviate loss of patient care revenue.  However, HRSA requires that providers receiving PRF funds comply with certain requirements, including post-payment reporting requirements.  HRSA is now notifying providers that failed to comply with the reporting requirements that they must return the PRF funds they received.  

Background on Provider Relief Funds and Reporting Requirements

HRSA has distributed funds from the PRF in multiple phases, through both “General Distributions” and “Targeted Distributions.”  To be eligible for a General Distribution, the provider must have billed Medicare fee-for-service (Parts A or B) during 2019.  These providers were also required to have provided diagnoses, testing, or care for individuals with possible or actual cases of COVID-19 after January 31, 2020. HRSA dispersed Targeted Distributions to providers and suppliers who served rural Medicaid beneficiaries and other COVID-19 high impact areas, such as safety net hospitals; skilled nursing facilities and nursing homes; children’s hospitals; and tribal hospitals, clinics, and urban health centers.  Though HRSA does not require providers to repay the funds received, providers must sign an attestation and accept the Terms and Conditions associated with the payment to retain the funds.

The Terms and Conditions of funds receipt are dependent upon the General or Targeted Distribution that the provider received.  However, common to all distributions is that the Terms and Conditions impose a reporting requirement upon the providers.  On June 11, 2021, HRSA outlined the requirements in its Post-Payment Notice of Reporting Requirements (Notice).  When a provider receives one or more payments in excess of $10,000 during a “Payment Received Period,” the provider is required to report this during each applicable Reporting Time Period.  According to the HRSA’s website, there are five Reporting Time Periods in total.  The most recently concluded reporting period was Reporting Period 2, which required providers to report payments received between July 1, 2020 and December 31, 2020 with the HRSA no later than March 31, 2022.

The Notice details information that providers must include in their report:

• Interest earned on PRF payments;

• Other assistance received, such as assistance from the Department of the Treasury, Small Business Administration, Federal Emergency Management Agency, local, state, and/or tribal governmental assistance, or business insurance;

• How the General Distribution and Targeted Distribution payments were used;

• Where applicable, how Skilled Nursing Facility and Nursing Home Infection Control Targeted Distribution payments were used;

• Net unreimbursed expenses attributable to COVID-19; and

• PRF payments (excluding the Skilled Nursing Facility and Nursing Home Infection Control Distribution payments) that providers can apply to patient care lost revenue reimbursement, if applicable.

Providers that Failed to Comply with Reporting Must Return Provider Relief Funds

As mentioned above, if a provider does not comply with the Terms and Conditions – including the reporting requirements – the provider will be required to return the funds to HRSA.  On March 30, 2022, Bloomberg Law (Bloomberg) reported that HHS is clawing back as much as $100 million dollars to the PRF, due to providers’ failure to comply with the reporting requirements for Reporting Periods 1 and 2.

Bloomberg reported that on March 10, 2022, HRSA sent notices and reminder e-mails to non-compliant health care providers and informed them that they must return any funds received within 30 days. Bloomberg also reported that the PRF fund was distributed automatically and unbeknownst to many providers. Thus, there is a possibility that many providers were unaware of the reporting requirements.

Opportunity to Remedy Noncompliance and Retain Provider Relief Funds

If a health care provider has failed to timely comply with the HRSA’s reporting requirements for Report Period 1 or 2 and has since received a notice, the providers do have recourse. HRSA permits providers to submit a “PRF Request to Report Late Due to Extenuating Circumstances” form (Request) through the HRSA’s PRF Reporting Portal.  Providers can only submit Requests between Monday, April 11 to Friday, April 22, 2022 at 11:59 p.m. EST.

It is important to note that merely submitting a Request does not guarantee approval. Approval or denial of Requests are subject to determination by HRSA within its sole discretion. HRSA has indicated that an “extenuating circumstance” includes the following:

• Severe illness or death;

• Natural disaster impact;

• Lack of receipt of reporting communications;

• Failure to click “Submit” on their PRF Reporting Portal;

• Internal miscommunication or error; or

• Incomplete Targeted Distribution payments.

Within the request, providers must certify and provide a concise explanation related to the applicable extenuating circumstance as listed above. The providers must then attest to the truthfulness of the extenuating circumstance. If HRSA approves the Request, the provider will receive a notification to complete the report, and will have ten days from receipt of notification to submit through the PRF Reporting Portal.  If HRSA denies the Request, the provider will be required to return funds received for the timeframe that it failed to comply.

Providers have an opportunity to remedy noncompliance, but should take caution when preparing a Request because approval or rejection is within the sole discretion of HRSA. Moving forward, the HRSA’s upcoming reporting periods are on the following dates:

• Reporting Period 3 opens on July 1, 2022;

• Reporting Period 4 opens on January 1, 2023; and

• Reporting Period 5 opens on July 1, 2023.