Hospitals Still Waiting on Remaining COVID-19 Provider Relief Funds

September 08, 2021 - The American Hospital Association (AHA) is urging HHS to distribute billions of dollars still sitting in the COVID-19 Provider Relief Fund.

The Sept. 2 special bulletin from the AHA said that it “continues its multi-pronged effort urging the Department of Health and Human Services (HHS) to expeditiously distribute the billions of dollars remaining in the Provider Relief Fund (PRF) to hospitals and health systems, as well as the American Rescue Plan Act funding to reimburse rural providers for COVID-19-related expenses and lost revenues.”

The bulletin is a follow-up from an Aug. 17 letter to HHS Secretary Xavier Becerra asking for the money on behalf of hospitals and health systems. The letter and previous AHA efforts to release the money were also featured in a Sept. 1 article published in The Washington Post. The article reports that about $44 billion remains in the Provider Relief Fund, which was created last year by pandemic-related legislation to support healthcare providers tackling COVID-19. That is about one-fourth of the $178 billion allotted to the Provider Relief Fund since last year.

Additionally, there is approximately $8.5 billion still earmarked for rural providers from legislation passed by Congress in March, The Washington Post article stated.

“The massive winter wave, and now the massive wave we are in, none of those have been targeted for funds,” AHA’s vice president for payment policy Joanna Hiatt Kim told the news source.

The AHA is not the only advocate for hospitals and health systems seeking federal support during the ongoing pandemic. Several lawmakers have also called on the Biden-Harris Administration to deliver the dollars to hospitals and health systems.

“Some providers are still waiting for funding from PRF distributions that were announced last year,” recently wrote Senators Susan Collins (R-ME) and Jeanne Shaheen (D-NH), along with 41 of their colleagues. “Furthermore, plans for additional PRF distributions have been opaque. Financial losses occurring between the end of 2020 and the beginning of 2021 have not been adequately considered. In addition, some provider types, such as senior care facilities, have been underrepresented in previous rounds of funding.”

The group of lawmakers called for HHS to announce and execute plans to distribute the remaining Provider Relief Funds as soon as possible. The funding would especially help rural providers for whom the funds have “prevented facilities that struggled before and during the pandemic from falling into bankruptcy or closing entirely,” they wrote.

Additionally, a group of Republican Senators, including Leader Mitch McConnell (R-KY), followed up with a letter last week espousing similar demands. Releasing remaining Provider Relief Funds is imperative now that hospitals and other providers are currently “stretched to breaking points” yet again because of the resurgence of COVID-19 across the country, they stated.

HHS lacks a strategy for distributing unspent COVID-19 Provider Relief Funds, a July report from the Government Accountability Office (GAO) indicated.

“Of the unobligated funds, according to HHS’s October 2020 spend plan, HRSA reserved a portion of the provider relief funds to respond to needs not identified in the spend plan, and in May 2021 HHS officials told us that the reserved funds were approximately $24 billion,” GAO stated at the time.

“HHS has not specified time frames for obligating these reserved funds or for the other $29.1 billion in unobligated provider relief funds. In addition, ARPA [American Rescue Plan Act] appropriated an additional $8.5 billion for rural providers, and as of May 31, 2021, all these funds remained unobligated.”

HHS told GAO in response to the report that it would “aim to incorporate some time frames on planned spending where such information may be available, such as time frames for select grants to states.”