On October 1, 2020, U.S. Department of Health and Human Services (HHS) announced a new $20 billion distribution from the Provider Relief Fund (PRF). This “Phase 3” distribution is intended to provide additional financial assistance to providers who continue to experience financial challenges, previously ineligible providers (e.g. new practices that started in 2020) and behavioral health providers. The full press release can be read here.

Providers will have from October 5, 2020 through November 6, 2020 to apply for Phase 3 General Distribution funding.

Eligibility

HHS is making a large number of providers eligible for Phase 3 General Distribution funding, including:

• Providers who previously received, rejected or accepted a General Distribution Provider Relief Fund payment. Providers that have already received payments of approximately 2% of annual revenue from patient care may submit more information to become eligible for an additional payment.
• Behavioral Health providers, including those that previously received funding and new providers.
• Healthcare providers that began practicing January 1, 2020 through March 31, 2020. This includes Medicare, Medicaid, CHIP, dentists, assisted living facilities and behavioral health providers.

Payment Methodology

All eligible providers will be considered for payment against the below criteria:

1. All provider submissions will be reviewed to confirm they have received a Provider Relief Fund payment equal to approximately 2% of patient care revenue from prior general distributions. Applicants that have not yet received Relief Fund payments of 2% of patient revenue will receive a payment that, when combined with prior payments (if any), equals 2% of patient care revenue.
2. With the remaining balance of the $20 billion budget, HRSA will then calculate an equitable add-on payment that considers the following:

• A provider’s change in operating revenues from patient care;
• A provider’s change in operating expenses from patient care, including expenses incurred related to coronavirus; and
• Payments already received through prior Provider Relief Fund distributions.

If you have any questions about the new Phase 3 General Distribution, including whether your practice is eligible, please contact Lamb McErlane Health Law attorneys Vasilios J. Kalogredis or Rachel E. Lusk.

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Vasilios J. “Bill” Kalogredis has been advising physicians, dentists, and other health care professionals and their businesses for over 40 years.  He is Chairman of Lamb McErlane PC’s Health Law Department.  bkalogredis@lambmcerlane.com ; phone, 610-701-4402; or fax, 610-701-3275.

Rachel E. Lusk-Klebanoff is a senior associate at Lamb McErlane PC who focuses on health law and health care litigation. She represents physicians, dentists, medical group practices, and other health-related entities in transactional, regulatory, and compliance matters. rlusk@lambmcerlane.com, phone, 610-701-4416.