HHS has finally issued general reporting requirements for the use of Provider Relief Funding. This document provides information on provider reporting guidelines, including intent, use of funds, and data elements requested. The purpose of the notice is to inform Provider Relief Fund (PRF) recipients that received one or more payments exceeding $10,000 in the aggregate what they will be required to report as part of the post-payment reporting process. It is significant that lost revenues will be based on net patient care operating income (revenues less direct patient care expenses). This was expected by many observers.
Recipients will report their use of PRF payments by submitting the following information:
- Healthcare related expenses attributable to coronavirus that another source has not reimbursed and is not obligated to reimburse, which may include General and Administrative (G&A) or healthcare related operating expenses.
- PRF payment amounts not fully expended on healthcare related expenses attributable to coronavirus are then applied to lost revenues, represented as a negative change in year-over-year net patient care operating income (i.e.,patient care revenue less patient care related expenses for the Reporting Entity, net of the healthcare related expenses attributable to coronavirus calculated under 1 above. Recipients may apply PRF payments toward lost revenue, up to the amount of their 2019 net gain from healthcare related sources. Recipients that reported negative net operating income from patient care in 2019 may apply PRF amounts to lost revenues up to a net zero gain/loss in 2020.
If recipients do not expend PRF funds in full by the end of calendar year 2020, they will have an additional six months in which to use remaining amounts toward expenses attributable to coronavirus but not reimbursed by other sources, or to apply toward lost revenues in an amount not to exceed the reported 2019 net gain.
Reporting Entities that received between $10,000 and $499,999 in aggregated PRF payments are required to report healthcare related expenses attributable to coronavirus, net of other reimbursed sources (e.g., payments received from insurance and/or patients, and amounts received from federal, state or local governments, etc.) in two aggregated categories (direct patient care expenses are reported in the determination of net operating revenue, discussed above).
Recipients who received $500,000 or more in PRF payments are required to report healthcare related expenses attributable to coronavirus, net of other reimbursed sources, in greater detail as follows:
- General and Administrative Expenses Attributable to Coronavirus – The actual G&A expenses incurred over and above what has been reimbursed by other sources:
- Mortgage/Rent: Monthly payments related to mortgage or rent for a facility.
- Insurance: Premiums paid for property, malpractice, business insurance, or other insurance relevant to operations.
- Personnel: Workforce-related actual expenses paid to prevent, prepare for, or respond to the coronavirus during the reporting period, such as workforce training, staffing, temporary employee or contractor payroll, overhead employees, or security personnel.
- Fringe Benefits: Extra benefits supplementing an employee’s salary, which may include hazard pay, travel reimbursement, employee health insurance, etc.
- Lease Payments: new equipment or software leases
- Utilities/Operations: Lighting, cooling/ventilation, cleaning, or additional third-party vendor services not included in “Personnel”.
- Other General and Administrative Expenses: Costs not captured above that are generally considered part of overhead structure.
- Healthcare Related Expenses Attributable to Coronavirus, over and above what has been reimbursed by other sources:
- Supplies: Expenses paid for purchase of supplies used to prevent, prepare for, or respond to the coronavirus during the reporting period. Such items could include personal protective equipment (PPE), hand sanitizer, or supplies for patient screening.
- Equipment: Expenses paid for purchase of equipment used to prevent, prepare for, or respond to the coronavirus during the reporting period, such as ventilators, updates to HVAC systems, etc.
- Information Technology (IT): Expenses paid for IT or interoperability systems to expand or preserve care delivery during the reporting period, such as electronic health record licensing fees, telehealth infrastructure, increased bandwidth, and teleworking to support remote workforce.
- Facilities: Expenses paid for facility-related costs used to prevent, prepare for, or respond to the coronavirus during the reporting period, such as lease or purchase of permanent or temporary structures, or to modify facilities to accommodate patient treatment practices revised due to coronavirus.
- Other Healthcare Related Expenses: Any other actual expenses, not previously captured above, that were paid to prevent, prepare for, or respond to the coronavirus.
Lost Revenue – Reporting Entities provide will information used to calculate lost revenues attributable to coronavirus, represented as a negative change in year-over-year net operating income from patient care related sources. Once revenue information is provided, cost/expense impacts will be calculated based upon a calendar year comparison of 2019 to 2020 healthcare expenses to determine net operating income. Revenues and expenses include all lost patient care revenues and patient care cost/expense impacts.
Reporting on a Quarterly Basis – Revenues and expenses will be reported on a quarterly basis for the entire 2019 year and, potentially for the first two (2) quarters of 2020 if needed to support use of the PRF.
Non-Financial Data – Additionally, non-financial data will also be collected (per quarter) as follows:
- Personnel Metrics: Total personnel by labor category (full-time, part-time, contract, other; recipient must define), total re-hires, total new hires, total personnel separations by labor category.
- Patient Metrics: Total number of patient visits (in-person or telehealth), total number of patients admitted, total number of resident patients.
- Facility Metrics: Total available staffed beds for medical/surgical, critical care, and other beds.
The Health Group, LLC will be providing a comprehensive summary of information to be accumulated and guidance in collecting that information in the next couple of weeks to assist you in preparing for your December 31, 2020 filing (currently due within 60 days of December 31, 2020).
You can review the guidance here.