The reporting requirements apply to PRF recipients who received one or more payments exceeding a total recipient payment of $10,000. Recipients of the general and targeted distribution funds will be required to report the use of their PRF payments by submitting the following information:
- Healthcare related expenses attributable to COVID-19 that another source has not reimbursed and is not obligated to reimburse. This may include General and Administrative expenses (G&A) or healthcare related operating expenses.
- PRF payment amounts not fully expended on healthcare related expenses attributable to COVID-19 are applied to lost revenues. This is represented as a negative change in year-over-year net patient care operating income (or patient care revenue less patient care related expenses for reporting entity that received funding), net of the healthcare related expenses attributable to COVID-19 calculated in the prior bullet point. The definition is a change from a previous FAQ released by HHS, which stated that lost revenues were any revenue that a healthcare provider loses due to COVID-19. Recipients may apply PRF payments towards 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 payments to lost revenues up to a net zero gain/loss in 2020.1
If PRF payment 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 COVID-19 but not reimbursed by other sources. They may also apply PRF payments towards lost revenues in an amount not to exceed the 2019 net gain.
Recipients will need to provide several data elements to HRSA and HHS so that both departments can assess whether a recipient’s PRF payments were used properly:
- Demographic Information
- Reporting Entity
- Tax Identification Number National Provider Identifier (NPI) (this requirement is optional).
- Fiscal Year-End Date
- Federal Tax Classification
Reporting entities that received between $10,000 and $499,999 in aggregated PRF payments are required to report healthcare related expenses attributable to COVID-19 in two aggregated categories: General and Administrative Expenses and other Healthcare Related Expenses.
Reporting entities that received $500,000 or more in PRF payments are required to report healthcare related expenses attributable to COVID-19 and must do so by reporting more detailed information within both the General and Administrative Expenses as well as the Healthcare Related Expenses.
Reporting entities will also need to provide information used to calculate lost revenues attributable to COVID-19. Lost revenues will be represented as a negative change in year-over-year net operating income from patient care related sources. The following listed revenue and expense information includes all lost patient care revenues and patient care cost/expense impacts:
- Total Revenue/Net Charges from Patient Care Related Sources (2019 and 2020)
- Revenue from Patient Care Payer Mix (2019 and 2020)
- Other Assistance Received (2020) (i.e. PPP)
- Total Calendar Year Expenses for 2019 and 2020
- General and Administrative Expenses (2019 and 2020)
- Healthcare Related Expenses (2019 and 2020)
Reporting entities that expended $750,000 or more in aggregated federal financial assistance in 2020 (including PRF payments and other federal financial assistance) are subject to Single Audit requirements. Recipients must indicate if they are subject to Single Audit requirements in 2020. If the recipient answers yes, the recipient must indicate if whether the auditors selected PRF payments to be within the scope of the Single Audit (if known when entity submits the report).
HHS has stated it will continue to clarify the use and reporting of PRF funds through Question and Answer (Q&A) sessions and Frequently Asked Questions (FAQs) to aid in the reporting process. The full text of HHS Post-Payment guidance released on September 19, 2020 can be found here.
Readers should not act upon information presented without individual professional consultation.
Any federal tax advice contained in this communication (including any attachments): (i) is intended for your use only; (ii) is based on the accuracy and completeness of the facts you have provided us; and (iii) may not be relied upon to avoid penalties.
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On September 19, 2020, the Department of Health and Human Services (HHS) released a post-payment notice of reporting requirements aimed at the recipients of the general and targeted distributions of the Provider Relief Fund (PRF) as established in the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The notice was released as a supporting document to the July 20, 2020 Post-Payment Notice of Reporting Requirements that can be found