What is PRF? Must know tax and reporting requirements of HHS provider relief fund distributions


As a result of the CARES Act, the Provider Relief Fund (PRF) was created to reimburse eligible health care providers for increased expenses or lost revenue attributable to COVID-19. Although initially $100 billion was provided to prevent, prepare for, and respond to the coronavirus domestically and internally, that amount was increased by $78 billion in two subsequent pieces of legislation.

Eligible providers include public entities, Medicare or Medicaid enrolled suppliers and providers, and both for-profit and not-for-profit entities that provide diagnoses, testing, or care for individuals with possible or actual cases of COVID-19. Health and Human Services (HHS) chose to have the PRF administered by the Health Resources and Services Administration (HRSA).

HRSA administers both the PRF and the Uninsured Program, as well as the COVID-19 Coverage Assistance Fund. HHS has chosen to allocate funds both generally and in targeted distributions. Four general distributions have been made, with the most recent distributions released in December 2021 and January 2022.

Phase One PRF distribution

Phase One was a general allocation to those providers billing Medicare Fee-for-Service and distributed quickly with no application necessary and the first distribution beginning on April 10, 2020. The total amount disbursed under Phase One amounted to a little less than $43 billion.

Phase Two PRF distribution

Phase Two targeted Medicaid, CHIP, and dental providers, including assisted living facilities. This Phase required an application and although it was to provide $18 billion, only about $5 billion was allocated during this phase of the distribution.

Phase Three PRF distribution

Phase Three targeted providers not previously receiving distributions either because they were new or had not received the distribution because they were behavioral health providers not previously included. Those providers who had previously received funding but not the full 2% of patient revenue in assistance were also eligible to reapply for more funds and could receive up to 2% of patient revenue. Although about one-third of those who applied for Phase Three funds did not receive them, HRSA allocated over $21 billion as of November 22, 2021.

Phase Four PRF distribution

Phase Four provided $17 billion for providers’ lost revenue and COVID-19-related expenses incurred between July 1, 2020, and March 3, 2021. Approximately $11 billion in payments have been released as of the end of January 2022. HHS is using Phase Four to reimburse small providers that have lower operating margins and serve vulnerable communities at higher rates, as well as bonus payments to providers serving Medicaid, CHIP, or Medicare populations with lower incomes and higher complex medical needs. Additional funding of $7.5 billion was provided through ARPA (American Rescue Plan Act) for payments to providers and suppliers serving rural Medicaid, CHIP, and Medicare beneficiaries. The distributions of those monies began in late November 2021.

Key PRF Program Dates

Key program dates include:

March 22, 2022, the last day to apply to HRSA for the COVID-19 Uninsured Program. The program provides funding for testing and treatment but will stop accepting claims due to insufficient funds.

March 31, 2022, the end of the second reporting period for providers receiving one or more PRF payments exceeding $10,000 in aggregate between July 1 and December 31, 2020.

April 5, 2022, the deadline for vaccination claims under either the Uninsured Program and the Coverage Assistance Fund due to insufficient funds.

May 2, 2022, Phase Four/ARPA Rural reconsideration applications are due.

The PRF Reporting Portal provides reporting requirements and auditing information related to recipients of PRF payments. As Phase One money was disbursed without application, thousands of new Yellow Book audits are anticipated. For more information about the reporting and related attest engagements, see Provider Relief Funds and You (CLPRFA), on Checkpoint Learning.



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