HHS Issues New Guidance for Provider Relief Fund Reporting

On September 19, 2020, the Department of Health and Human Services (HHS) released much-anticipated post-payment reporting requirements for the Provider Relief Funds (PRF).  The guidance will have a significant impact on many providers as it not only provides information on reporting requirements; it also provides guidance and clarification on eligible uses and “lost revenue.”

Under the new guidance, recipients will be required to report several data elements, including demographic information, information about their expenses attributable to coronavirus, information about their lost revenues and additional (non-financial) information. Recipients also must report information on changes in ownership and their Single Audit status (if known at the time of reporting).

Healthcare-Related Expenses

PRF payments will first be applied to offset healthcare-related expenses attributable to the coronavirus. Recipients that received between $10,000 and $499,999 in aggregated PRF payments must report healthcare-related expenses attributable to coronavirus (net of other reimbursed sources) in two aggregated categories: (1) general and administrative (G&A) expenses and (2) other healthcare-related expenses. Recipients that received $500,000 or more in PRF payments are required to report healthcare- related expenses attributable to coronavirus (net of other reimbursed sources) by reporting more detailed information within those two categories, according to several sub-categories detailed in the guidance.

Lost Revenues

Any PRF payment amounts that were not fully expended on healthcare-related expenses attributable to coronavirus are then applied to the provider’s “lost revenues”. Previous guidance provided by HHS stated providers could use any reasonable methodology to calculate lost revenues. However, the new guidance now defines “lost revenues” as the provider’s lost margin. This change may be significant for many providers.

Under the new guidance, lost revenues attributable to coronavirus will be reported as the difference between 2019 and 2020 net patient care operating income (patient care revenue less patient care– related expense), net of the healthcare-related expenses attributable to coronavirus as noted above. PRF payments may be applied toward lost revenue only up to the amount of the provider’s 2019 net gain from healthcare-related sources. Providers with negative net operating income from patient care in 2019 may apply PRF amounts to lost revenues up to a net zero gain/loss in 2020. This allows providers that lost money in 2019 to break even in 2020.

Unused Funds

If providers do not expend PRF in full by the end of calendar year 2020, they will have until June 30, 2021, to use the remaining amounts toward qualifying expenses and lost revenues. The January-June 2021 reporting period will be compared to January-June 2019, and lost revenues reported for 2021 may not exceed the provider’s 2019 net gain.

Other Reporting Requirements

HHS will require recipients to submit certain non-financial data. This information will include metrics on personnel, patients, and facilities. Recipients that acquired or divested of related subsidiaries must also submit information regarding that change in ownership. Recipients must also report whether they are subject to Single Audit requirements in 2020. If so, they must report whether their PRF payments were selected as within the scope of their Single Audit (if the recipient knows this information at the time of reporting).

Single Audit

HHS has stated expenditures of PRF funds would be included in the calculation of federal expenditures in determining if an entity is required to have a single audit or a program-specific audit completed under Generally Accepted Government Auditing Standards (GAGAS), including for-profit entities. Entities with total federal expenditures greater than $750,000 will be required to have a single audit or a program- specific audit. For not-for-profit organizations, single audits may be familiar, given that they are often triggered from federal grants. However, for for-profit companies, the PRF funds could trigger the need for a single audit or program-specific audit for the first time.

Reporting Entity

A parent entity can report on the use of general distribution PRF payments by its subsidiaries, but each subsidiary entity that received a targeted distribution PRF payment must individually report on the use of its targeted distribution payments.


The updated guidance did not explicitly revise the deadlines articulated in the previous guidance released on July 20, 2020, except to say that the reporting portal will be available in early 2021 (instead of on October 1, 2020). The other deadlines appear to remain unchanged. However, as with previous PRF deadlines, these deadlines may be adjusted as the reporting mechanism is implemented. Important reporting deadlines are highlighted below:

  1. All recipients must report within 45 days of the end of the calendar year 2020 (e., by February 15, 2021) on their expenditures through the period ending December 31, 2020. Note: 45 days falls on Sunday, February 14, 2021, so we expect further clarification.
  2. Recipients who have expended funds in full prior to December 31, 2020, may submit a single final report at any time during the first reporting window (early 2021 through February 15, 2021).
  3. Recipients with funds still unexpended after December 31, 2020, must submit a second and final report no later than July 31, 2021.

Questions? Contacts us at covid19relief@hertzbach.com.