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New law allocates additional $100 billion for COVID-19 health care and testing

published in McAfee & Taft LINC | April 24, 2020

Today, President Trump signed into law the Paycheck Protection Program and Health Care Enhancement Act. Overwhelmingly approved by Congress, the Act includes $75 billion for healthcare and an additional $25 billion for testing.  The U.S. Department of Health and Human Services will distribute the $75 billion to providers treating COVID-19 patients.  Recipients may use the funds to pay for additional personal protective equipment, expanding hospital space, and reimbursement for other pandemic-related expenses, including lost profits attributable to the coronavirus.  The $25 billion will assist state and federal authorities in expanding testing for COVID-19, as well as the antibodies indicating possible immunity, and may be used for employer-administered testing.  The remainder of the Act’s relief package is allocated for small businesses.

Additionally, HHS announced further allocations under the Public Health and Social Services Emergency Fund established under the CARES Act.  Between April 10 – 17, 2020, HHS distributed $30 billion to providers based on their shares of Medicare fee-for-service reimbursements in 2019.  Beginning today, HHS will allocate an additional $20 million among providers who experience a relatively small share of revenue from Medicare fee-for-services reimbursements.  Some providers will automatically receive an advance payment based on revenue data they submit to CMS in cost reports.  Providers without adequate cost report data may submit their revenue information to CMS online at https://www.hhs.gov/providerrelief.  Receipt of these funds requires provider attestation, confirming receipt and agreeing to certain terms and conditions.  One condition includes an agreement not to seek collection of out-of-pocket payments from, or “balance bill,” a presumptive or actual COVID-19 patient in amounts greater than would have been required if the patient were in-network.

HHS also announced targeted allocations of the remaining $50 million under the Fund, as follows:

  1. HHS will allocate $10 billion to hospitals in areas that have been particularly impacted by COVID-19, based on an application process;
  2. HHS will allocate a portion of the funds to reimburse healthcare providers for COVID-19 related treatment of the uninsured, using Medicare rates, based on submission of claims and subject to availability of funds;
  3. HHS will allocate $10 billion automatically to rural health clinics and hospitals, which typically operate on razor thin margins, using a proportionate methodology;
  4. HHS will allocate $400 million automatically to Indian Health Service facilities on the basis of operating expenses; and
  5. HHS will allocate additional, separate funding to some providers, including skilled nursing facilities, dentists, and providers that solely take Medicaid, but no further details have been provided on the additional allocations to these providers at this time.

For assistance in navigating issues created by the COVID-19 pandemic, please contact your McAfee & Taft Healthcare attorney.

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