COVID-19 Funding Update

Toyon is pleased to provide this update on COVID-19 funding for rural providers.

 
● $8.5 billion in funding for rural providers
 
● Providers in rural areas, providers in MSAs less than 500K, and rural referral centers.  
 
● Recognition of COVID-19 expenses – direct, indirect, and stranded – is critical.
 
$8.5 billion in Provider Relief for Rural Providers
 
On March 11, 2021, H.R.1319 – American Rescue Plan Act of 2021 was signed into law appropriating $8.5bn of COVID-19 funding for rural providers recognizing healthcare expenses and lost revenues attributed to COVID-19. Rural providers eligible for this funding include:
 
This legislation specifies as part of eligibility, a provider will submit an application including, “A statement justifying the need of the provider for the payment, including documentation of the health care related expenses attributable to COVID-19 and lost revenues attributable to COVID-19.”
 
Toyon’s Take
HHS has yet to prescribe how hospitals and providers apply for this additional COVID-19 funding for rural providers. However, documenting healthcare related expenses and lost revenue is the same information providers will be submitting to justify current CARES funding allocations (the reporting was delayed from February 15, 2021). It is possible, yet still undetermined, information reported to the Provider Relief Fund Reporting Portal could be the same information used to determine hospital funding need. 
 
Recognizing all costs – direct, indirect and stranded – is critical not only to justify funding, but also to prove eligibility for additional funding. The legislation notes this funding “includes” expenses as follows:
 
“…health care related expenses to prevent, prepare for, and respond to COVID-19, including the building or construction of a temporary structure, the leasing of a property, the purchase of medical supplies and equipment, including personal protective equipment and testing supplies, providing for increased workforce and training (including maintaining staff, obtaining additional staff, or both), the operation of an emergency operation center, retrofitting a facility, providing for surge capacity, and other expenses determined appropriate by the Secretary.”
 
Toyon continues to advocate HHS recognize not only the direct expenses, much of which are delineated in the legislation – but also the indirect and stranded expense resulting from COVID-19. These expenses are currently discussed in HHS’s “$85 FAQ” and may include, but are not limited to:
 
✓ The inability to flex down during preparations for COVID-19 surges
✓ Rapid employee burnout and turnover
✓ Current labor costs and an unknown future
✓ Excess laboratory cost from pandemic
✓ Wear and tear on assets – shortening the useful life of an asset
 
We are Here to Help
Please contact Fred Fisher at 888.514.9312, fred.fisher@toyonassociates.com. Feel free to also visit Toyon’s COVID-19 Funding Resources
 
Respectfully,
Toyon Associates
Toyon Associates Healthcare Finance

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