Legal Intelligencer article by Lamb McErlane PC Health Law attorneys Vasilios J. Kalogredis and Rachel E. (Lusk) Klebanoff.

Earlier this month, the Health Resources and Services Administration (HRSA) announced that it planned to reopen the Provider Relief Fund (PRF) reporting period after thousands of recipients were asked to return the money for missing the deadline back in September.

The announcement comes after Bloomberg Law reported on the HRSA’s efforts to claw back over $100 million from providers who received the money without asking for it and said they did not know there were strings attached. Some providers were asked to return as much as $250,000 amid unprecedented inflation and increased financial burdens due to new virus variants.

In early March, the HRSA sent notices to non-compliant facilities giving them 30 days to return the funds.  “If you do not return the funds, HRSA will initiate the recovery of all funds not reported on” during the first reporting period. Those providers will also be excluded from future payments, the HRSA said.  The HRSA confirmed that the letters went out.

In response, dozens of medical groups sent a letter to the Department of Health and Human Services’ HRSA, urging the agency to give providers another chance to report how they spent the funds before owing it all back.  In a statement to Bloomberg Law, a spokesperson for the HRSA said the agency reminded of the requirement via email, mail, outreach to organizations, and social media.  However, reminder emails about reporting requirements went to some facilities’ spam folders or to staffers who initially accepted the money but ended up leaving their jobs, according to the Medical Group Management Association, which represents health-care practices and providers.

Providers can now submit a “Request to Report Late Due to Extenuating Circumstances Form” (the deadline for Reporting Period 1 was April 22, 2022).  For each PRF Reporting Period, a provider may request an opportunity to complete their report after the reporting period deadline based on attestation that one of the following allowable extenuating circumstances applies at the time of the deadline:

• Severe illness or death– a severe medical condition or death of a provider or key staff member responsible for reporting hindered the organization’s ability to complete the report during the Reporting Period.
• Impacted by natural disaster– a natural disaster occurred during or in close proximity of the end of the Reporting Period damaging the organization’s records or information technology.
• Lack of receipt of reporting communications– an incorrect email or mailing address on file with HRSA prevented the organization from receiving instructions prior to the Reporting Period deadline.
• Failure to click “Submit”– the organization registered and prepared a report in the PRF Reporting Portal, but failed to take the final step to click “Submit” prior to deadline.
• Internal miscommunication or error– internal miscommunication or error regarding the individual who was authorized and expected to submit the report on behalf of the organization and/or the registered point of contact in the PRF Reporting Portal.
• Incomplete Targeted Distribution payments– the organization’s parent entity completed all General Distribution payments, but a Targeted Distribution(s) was not reported on by the subsidiary.

While attesting to an extenuating circumstance is required, no supporting document or proof is required. Moreover, the HRSA will not require non-compliant providers to return funds until after the “Request to Report Late Due to Extenuating Circumstances” process for Reporting Period 1 has closed. Providers who submit a request will be notified by HRSA if their request is approved or denied.

Details about Requests to Report Late Due to Extenuating Circumstances for Reporting Period 2 and beyond will be announced in the coming weeks.

The PRF, supported by the HRSA, provides up to $178 billion in relief funds for health-care providers that lost revenue and expenses due to the Covid-19 pandemic.  While PRF monies were never meant to be repaid, it has become evident that there is no such thing as “free money.”  The strings attached to these funds have changed several times, and even though some revisions have increased flexibility for providers, they are still complex and taxing to keep track of.

The HRSA has made clear that providers whose request to report late is denied will remain non-compliant with the Terms and Conditions of receipt of Provider Relief Funds. Additionally, providers may not use the request to report late process to edit or adjust already submitted reports. Providers who need to take advantage of the Request to Report Late Due to Extenuating Circumstances process should move quickly.

_______________________________________________

Vasilios J. (Bill) Kalogredis, Esq. has been advising physicians, dentists, and other health care professionals and their businesses as to contractual, regulatory and transactional matters for over 45 years. He is Chairman of Lamb McErlane PC’s Health Law Department. bkalogredis@lambmcerlane.com. 610-701-4402.

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

Read the article online on Law.com here.