Operators expected to keep more aid after HHS revises Provider Relief Fund reporting requirements in response to ‘significant opposition’

Citing “significant attention and opposition from many stakeholders and members of Congress,” HHS has revised requirements for Provider Relief Fund reporting and broadened the definition of “lost revenue.”

The move, announced Thursday, is expected to enable senior living operators to retain a greater amount of federal aid they receive as they battle the coronavirus.

Operators receiving Provider Relief Fund money must report lost revenue attributable to COVID-19. June 19, HHS defined that as “any revenue that you as a healthcare provider lost due to coronavirus.” In updated guidance issued Sept. 19, however, HHS changed that definition to be the year-over-year negative change in net patient care operating income.

That new guidance, American Seniors Housing Association David Schless and Argentum President and CEO James Balda said in a letter sent to Health and Human Services Secretary Alex Azar on Monday, created “significant challenges” for senior living communities by penalizing organizations “in the midst of growth in facility capacity” with newly constructed or recently expanded communities. It also penalized organizations “that made prudent efforts to reduce operating expenses” in response to financial challenges created by the pandemic, they said. The September guidance reduced the amount of funds that could be retained based on improvement in operating performance made later in the year, according to the letter.

“This decision to prohibit most providers from using PRF payments to become more profitable than they were pre-pandemic, in order to conserve resources to allocate to providers who were less profitable, has generated significant attention and opposition from many stakeholders and members of Congress,” HHS said Thursday in a policy update. “There is consensus among stakeholders and members of Congress who have reached out to HHS that the PRF should allow a provider to apply PRF payments against all lost revenues without limitation. In consideration of this feedback, HHS has amended its reporting instructions to provide for the full applicability PRF distributions to lost revenues.”

Thursday, in response to the revised guidance, Schless said it, “is more consistent with guidance that was previously relied upon by senior living operators.”

ASHA, he added, will continue to seek clarification from HHS about other reporting guidance issued in September.

Additional information from HHS is posted here.