Hospitals again ask HHS for more time to spend relief funds

Hospitals are again pleading with the Biden administration for more time to spend COVID-19 relief grants received before June 30, 2020.

HHS’ latest guidance, released June 11, laid out four separate deadlines for when providers need to spend or return their Provider Relief Fund grants. But the deadline for returning money received before June 30, 2020 was unchanged: Providers will still have to give back any unspent money by June 30.

In a letter to HHS Secretary Xavier Becerra this week, AHA CEO Rick Pollack urged him to let providers keep PRF money distributed before June 30, 2020 until the end of the COVID public health emergency or June 30, 2022, the final deadline in HHS’ most recent guidance.

Pollack wrote that well over half of the PRF money that’s been given out so far went out before June 30, 2020. He said it went disproportionately to providers in areas heavily impacted by COVID’s first wave and serving vulnerable populations, as well as those in rural areas.

Congress appropriated a total of $178 billion to the fund, of which more than $30 million has not yet been distributed, including $8.5 billion Congress appropriated for rural providers.

The June 30, 2021 deadline for spending the money was set under the Trump administration, and the Biden administration has so far not agreed to change it. Biden’s HHS earlier this month set staggered deadlines for using the money through the end of 2022. However, anything received between April 10 and June 30, 2020 still needs to be returned by June 30 if providers do not have the COVID expenses or lost revenue to justify keeping it.

“Setting the June 30 deadline for funds received during the aforementioned time period really sort of arbitrarily penalizes hospitals that got funding during that time, which was a lot of the vulnerable hospitals, because they will not be able use the funding to support their COVID activities,” said Joanna Hiatt Kim, the AHA’s vice president of payment policy and analysis.

Hiatt Kim could not say how many of the AHA’s almost 5,000 members would have to give money back if the June 30 deadlines stands, but she said her organization is most concerned about rural hospitals and those serving high numbers of Medicaid patients.

Rick Kes, RSM’s healthcare industry senior analyst, said his healthcare clients received most of their PRF money before June 30, 2020. Money that’s come since then has been smaller increments.

Kes said the HHS’ June 11 guidance and its four different time periods forced providers to change how they categorize the grant money.

“It quite honestly caused a significant amount of questions from our clients because I think they’re all confused,” he said. “‘What does this mean for us?'”

In his letter, Pollack noted that the public health emergency is “very much ongoing.” For the week of June 20, COVID hospitalizations in 11 states increased week over week, with several increasing by double digits. A dozen states still have intensive care unit occupancy rates of 75% or more, with three states over 80%.

Pollack also referenced the Occupational Safety and Health Administration’s new guidelines requiring healthcare employers to have plans to control COVID hazards, noting that will be another added expense. Hospitals will have to meet the requirements within the next 30 days.


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