Phase 3 Application for Provider Relief Opens Oct 5

Regulation | October 01, 2020 | by Nicole Fallon

The U.S. Department of Health and Human Services (HHS) announced that providers may begin applying for a $20 billion Phase 3 General Distribution of Provider Relief Funds(PRF) on Monday, October 5 and that even those providers who have received a full 2% of their annual patient care revenue through prior distributions may be eligible for an "add-on" payment based upon their incurred coronavirus expenses and lost revenues. 

This distribution is a bit unique in a few of ways:

  • Providers who began providing services between January 1 and March 31, 2020 are eligible for the first time to apply for PRF dollars. According to HHS, "This includes Medicare, Medicaid, CHIP, dentists, assisted living facilities and behavioral health providers." It is not clear if private pay only providers who meet this 2020 opening criteria are also eligible to apply under this Phase 3 General Distribution. 
  • This will be the first time that providers who previously received 2% of their annual patient care revenue may apply for additional payments over this amount by submitting information to support an additional payment based upon incurred coronavirus costs and losses.(Private pay only assisted living and nursing home providers who recently received some funds through the Phase 2 distribution appear to be eligible for the add-on opportunity).
  • Unlike prior disitrbutions where HHS would send providers payments on a rolling basis, it appears that the Phase 3 funding will have two stages where first it will ensure all eligible applicants receive their full 2% distribution and then if there are remaining funds, HHS will "calculate an equitable add-on payment" that takes into account: at a provider's change in operating revenues from patient care, operatinh expenses from patient care including those related to coronavirus and payments received to date through PRF. 

Providers should review the eligibility criteria in the announcement and must apply between Monday, October 5 and Friday, November 6. Given the way HHS is determining payments in this phase, providers are encouraged to apply early so payments can go out more quickly. 

Members should keep in mind that only $20 billion is set aside for this phase. We estimate that after the Phase 3 PRF payments are made HHS will have roughly $15-20 billion left in the PRF of the original $175 billion appropriated for the Provider Releif Fund. So, this is likely the last opportunity for providers to apply for funding, barring a new appropriation from Congress as part of another Stimulus bill. HHS has indicated that they will be hosting webinars to assist providers with the application process. Providers can also seek assistance with this process through the Provider Support Line by calling 1-866-569-3522. 

UPDATE (10/5): HHS has now updated its CARES Act Provider Relief Fund website with more information on the Phase 3 application process. We have captured this information in a single document for members.