HHS Announces $35 billion in Additional CARES Act Distributions

June 11, 2020

On June 9, the U.S. Department of Health and Human Services (HHS) announced three new pots of funding totaling $35 billion that will be going out from the Provider Relief Fund Authorized in the CARES Act. So far, it appears this funding will have minimal impact on Wisconsin hospitals and health systems.
The announced funding is divided into three pots, focused on funding Medicaid and CHIP health care providers and professionals, certain safety-net hospitals, and more “hot spot” or high-impact areas. It includes: 
  • $15 billion to health care providers that participate in state Medicaid & CHIP programs but did not receive anything from the previous $50 billion general distribution tranche.
  • $10 billion to safety-net hospitals with a Medicare Disproportionate Payment Percentage of 20.2% and up, a per-bed uncompensated care level of $25K and up, and a margin of 3% or less in its most recent cost report.
  • $10 billion for another round of “hot spot” funding based on the number of COVID-19 patients admitted as of June 10.
While few details are available, it seems most of this funding will miss Wisconsin hospitals and health systems. Because most, if not all, Wisconsin hospitals and health systems received a distribution from the original $50 billion tranche that was issued in April, they will be ineligible for any of the $15 billion Medicaid and CHIP distribution. However, HHS estimates these funds will go to approximately 275,000 health care providers, including pediatricians, obstetricians, substance use and behavioral health providers, assisted living facilities, and providers who receive funding under home and community-based service waivers. Additionally, the $10 billion tranche will go to 758 hospitals, but only four meet the criteria in Wisconsin, according to HHS.
For the “hot spot” funding, HHS has said it will analyze submitted information on COVID-19 admissions before it decides about allocating this funding. Hospitals who wish to apply must submit information by 8 p.m. CST on Monday, June 15 into the same teletracking portal HHS used during the initial round of “hot spot” funding. Two Wisconsin hospitals received funding from that distribution, for a total of $32 million. In its FAQs document on the topic, HHS says it will take that past “hot spot” funding into account in making payments under the new round.
With the $35 billion announced on June 9, upwards of $60 billion remains available for HHS to distribute from the $175 billion authorized in the Provider Relief Fund from the CARES Act and subsequent federal legislation. In a phone call last week, senior HHS officials announced they are planning to have hospitals submit COVID-19 expense and lost revenue information to inform what they anticipate to be another large general distribution going to hospitals and health systems; however, no formal details have yet been announced.
Congress has yet to agree on whether it will pass another COVID-19 stimulus package. While the U.S. House voted on May 15 to send another $100 billion into the Provider Relief Fund as part of a $3 trillion package, the U.S. Senate is not expected to take up that legislation, and is instead pausing to evaluate how past stimulus funds have been spent. The Senate is expected to work on its COVID-19 package during the summer and will likely spend far less than was passed in the U.S. House. WHA continues to advocate for additional needed state and federal relief for Wisconsin hospitals and health systems, noting that most continue to project revenue losses and great uncertainty going forward due to the pandemic.
For additional details, contact WHA Director of Federal and State Relations Jon Hoelter.

This story originally appeared in the June 11, 2020 edition of WHA Newsletter