“Keeping up with COVID-19” Webinar Recap: Understanding CARES Funding and Programs

By nThrive | Posted: 05/07/2020

nThrive Coronavirus Health Care Webinar Recap CARES Funding

“If there is one word to describe The Coronavirus Aid, Relief and Economic Security (CARES) Act, passed on March 27, 2020, it is complicated,” said Matthew Dardenne, nThrive Senior Dispute Resolution Counsel. However, he recently broke down key details in an nThrive “Keeping up with COVID-19” webinar, “The CARES Act Impact on Health Care Funding and Programs.”

Watch the webinar replay and access the presentation HERE.

Dardenne primarily focused on several specific provisions in the CARES Act that provide direct funding, including the CARES $100 Billion Emergency Fund for Health Care Providers, and the CARES $27 Billion Emergency Fund for Procurement and Development. The $100 billion fund is specifically for emergency response needs, while the $27 billion is earmarked for medical expansion, medical financing and miscellaneous programs.

Who can participate in the $100 Billion Emergency Fund?

All health care Medicare providers – for- or non-profit – can participate in the $100 Billion Emergency Fund, if use is tied to the COVID-19 Coronavirus pandemic. Recovering lost revenue not funded through another source includes:

  1. Canceled procedures
  2. Medical supplies
  3. Personal protective equipment
  4. Increased staffing or training

Dardenne noted that Chuck Schumer, senior United States senator from New York, called The CARES Act “the Marshall Plan for COVID-19,” meaning that it is to be used in the most maximum way possible. Hospitals and health care organizations should look to the U.S. Department of Health & Human Services (HHS) for ongoing guidance.

How will distribution of the $100 billion fund work?

Many hospitals and health care organizations already have begun to see emergency funds flow into their accounts from an initial $30B disbursement of CARES funds (at the time of this webinar, no information was available on when the next $70B will be released, however, it is expected to be targeted to areas hardest hit by COVID-19).

Providers are paid via Automated Clearing House information on file with UnitedHealth Group of the Centers for Medicare and Medicaid Services (CMS), with payment based on a 1/16th ratio of 2019 Medicare fee-for-service payments. Initial payments are entitled, “US HHS Stimulus” or “HHSPAYMENT.”

All funds for the $100 billion emergency fund are expected to be disbursed by the end of 2020.

Those receiving more than $150,000 must document use of the funds at the end of each quarter, filing a report on use with the HHS Office of the Assistant Secretary for Preparedness and Response (ASPR).

Speaking to his audience of health care leaders, Dardenne said, “If I was in your shoes, I would constantly be going to the coronavirus.gov website, checking twice a day for new guidelines,” as information is being posted on a daily basis He also suggested carefully reviewing the terms and conditions found here.

You can also stay up-to-date with the recently launched nThrive COVID-19 Coronavirus portal. Additional details are provided below to keep your medical organization in the loop on crucial industry developments and how our experts can assist you during this time.

How can the $27 Billion Emergency Fund be used?

The $27 Billion Emergency Fund extends through 2024 and can be used for expenses related to:

  • Development and purchase of vaccines
  • Perform diagnostics
  • Provide medical surge capacity
  • Fund workforce modernization, telehealth access and other preparedness and response activities

At least $250 million of these funds must be made available to entities that are part of the Hospital Preparedness Program. In addition, at least $16 billion must be used to purchase products for the Strategic National Stockpile.

For those in the testing and diagnostic business, Dardenne noted that products purchased with the funds must be done so in accordance with Federal Acquisition Regulation guidance on fair and reasonable pricing. He added that “there is information on the coronavirus.gov website on how testing and development of vaccines will be handled in the future.”

Applications for medical expansion funds can be requested from Medicare Administrative Contractors (MACs), private insurers that have been awarded geographic jurisdiction to process Medicare Part A and Part B (A/B) medical claims or Durable Medical Equipment (DME) claims for Medicare Fee-For-Service (FFS) beneficiaries. Funding can be requested for up to 125% of Medicare payment, with MACs committed to issuing payments within seven days.

Other provisions in the CARES Act affecting cash flow, include:

  • Eliminating the Medicare sequester from May 1 through December 31, 2020
  • Providing a 20% add-on to the DRG rate for patients with COVID-19 during the emergency period (May 1 through December 31, 2020; applies to patients treated at rural and urban inpatient prospective payment system (IPPS) hospitals

Using CARES to fund telehealth

CARES Act funding can be used for three types of telehealth visits:

  1. Medicare telehealth visits in lieu of traditional in-person services
  2. Virtual check-in
  3. E-visits

Health care providers must use interactive audio and video technology and Medicare will not conduct audits to ensure prior relationship for the Sec. 1135 waiver.

“Organizations will need to know how to properly code for telehealth,” Dardenne emphasized, referring visitors to the Centers for Medicare and Medicaid Services (CMS) website for the specific code information.

Click here to read additional details surrounding the FCC Telehealth program during the COVID-19 Coronavirus pandemic.

Other key Medicaid provisions

The CARES Act eliminates $4 billion in Medicaid DSH cuts anticipated this year and enables non-expansion states to use the Medicaid program to cover COVID-19-related services for uninsured adults who would qualify if their state had chosen to expand.

The Act also extends several Medicare and Medicaid programs and policies, including:

  • Work Geographic Practice Cost Index (GPCI)
  • Money Follows the Person demonstration program
  • Spousal impoverishment protections under Medicaid
  • Certified Community Behavioral Health Clinics demonstration program (with two additional states participating)

Payroll tax deferral and small business loans

In addition to the CARES Act funding relief, Dardenne added that hospitals can delay payment of the employer share of social security payroll taxes through December 31, 2020. Health care providers with fewer than 500 employees can apply for a small business loan under the Paycheck Protection Act.

Please find more information on our business continuity and recovery solutions at our regularly updated COVID-19 Coronavirus Portal at www.nthrive.com/covid19. You can use this same link to register for upcoming COVID-19 webinars, view recordings and presentation materials from previous webinars, and read pertinent industry related updates. Please feel free to contact our experts by using the form fill area and learn how nThrive can help your medical organization during this time.