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Future Payments

New Distributions

On September 29, 2021, health care providers will be able to apply for $25.5 billion in relief funds, including $8.5 billion in American Rescue Plan (ARP) resources for providers who serve rural patients and $17 billion for Provider Relief Fund (PRF) Phase 4 for a broad range of providers who can document revenue loss and expenses associated with the pandemic.

In order to streamline the application process and minimize administrative burdens, providers will apply for both programs in a single application and HRSA will use existing Medicaid/CHIP and Medicare claims data in calculating portions of these payments.

  • Phase 4 General Distribution — $17 billion based on providers’ lost revenues and changes in operating expenses from July 1, 2020 to March 31, 2021.
    • To promote equity and to support providers with the most need, HRSA will:
      • Reimburse a higher percentage of lost revenues and expenses for smaller providers as compared to larger providers.
      • Provide "bonus" payments based on the amount of services they provide to Medicaid, CHIP, and Medicare patients, priced at the generally higher Medicare rates.
  • American Rescue Plan (ARP) Rural — $8.5 billion based on the amount of services providers furnish to Medicaid/CHIP and Medicare beneficiaries living in Federal Office of Rural Health Policy (FORHP)-defined rural areas.
    • To promote equity, HRSA will price payments at the generally higher Medicare rates for Medicaid/CHIP patients.

Phase 3 Reconsiderations

To promote transparency in the PRF program, HHS has released detailed information (PDF - 175 KB) about the methodology utilized to calculate Phase 3 payments. Providers who believe their Phase 3 payment was not calculated correctly according to this methodology will now have an opportunity to request a reconsideration. Further details on this Phase 3 reconsideration process are forthcoming.

What Is the Provider Relief Fund?

Qualified providers of health care, services, and support may receive Provider Relief Fund payments for healthcare-related expenses or lost revenues due to coronavirus. These distributions do not need to be repaid to the US government, assuming providers comply with the terms and conditions.

What is ARP Rural?

ARP Rural is intended to help address the disproportionate impact that COVID-19 has had on rural communities and rural health care providers, and funding will be available to providers who serve patients in these communities. ARP Rural payments are administered jointly with the Provider Relief Fund, and eligible applicants can apply through the same Application and Attestation Portal that will be available to apply for the Phase 4 General Distribution.  Eligible rural providers have the opportunity to simultaneously be considered for both Phase 4 and ARP Rural payments.

What Does "Provider" Mean?

Any provider or supplier of health care, services, and support in a medical setting, at home, or in the community, including, but not limited to:

  • Academic Medical Centers
  • Children’s Hospitals
  • Acute care hospitals
  • Ambulatory surgical centers
  • Assisted Living Facilities
  • Behavioral health providers (e.g., substance use disorder, counseling, psychiatric services)
  • Dental services
  • Diagnostic services (e.g., independent imaging, radiology, labs)
  • DME suppliers
  • Eye and vision services
  • Federally Qualified Health Centers
  • Home and community-based support (e.g., housing services, care navigators, case management)
  • Home health agencies
  • Inpatient behavioral facilities (e.g., inpatient rehabilitation facilities, long-term acute care hospitals, other residential facilities)
  • Multi-specialty practices
  • Nursing homes and skilled nursing facilities
  • Other ancillary services (e.g., chiropractors, speech and language pathologists, physical therapy, occupational therapy)
  • Other inpatient facilities
  • Other outpatient clinics (e.g., urgent care, dialysis center)
  • Other services (e.g., foster care, developmental disability services)
  • Other single-specialty practices
  • Pediatrics practices
  • Pharmacies
  • Primary care practices
  • Rural Health Clinics

What Can I Do To Prepare for the Upcoming Applications?

  • Search the Rural Health Grants Eligibility Analyzer to see what areas qualify as "rural" for the ARP rural payments.
  • Gather supporting documentation, such as most recent tax documents and financial statements for the second half of calendar year (CY) 2020 and the first quarter of CY 2021.

Who Is Eligible To Apply and How Will Payments Be Calculated?

Phase 4 General Distribution: Consistent with the requirements included in the December appropriations bill, PRF Phase 4 payments will be based on providers’ lost revenues and increased expenditures between July 1, 2020 and March 31, 2021. Phase 4 will also include new elements specifically focused on equity, including reimbursing smaller providers for their lost revenues and COVID-19 expenses at a higher rate compared to larger providers, and bonus payments based on the amount of services providers furnish to Medicaid/CHIP and Medicare patient.

  • 75% of the Phase 4 allocation will calculated based on revenue losses and COVID-related expenses.
    • Large providers will receive a minimum payment amount that is based on a percentage of their lost revenues and COVID-related expenses.
    • Medium and small providers will receive a base payment plus a supplement, with small providers receiving the highest supplement, as smaller providers tend to operate on thin margins and often serve vulnerable or isolated communities.
    • HHS will determine the exact amount of the base payments and supplements after analyzing data from all the applications received to ensure we stay within our budget and funds are distributed equitably.
    • No provider will receive a Phase 4 payment that exceeds 100% of their losses and expenses.
    • HHS will continue to use risk mitigation and cost containment measures in Phase 4 to protect program integrity and preserve taxpayer dollars.
  • 25% of the Phase 4 allocation will be put towards bonus payments that are based on the amount and type of services provided to Medicaid, CHIP, and Medicare patients.
    • HHS will price Medicaid and CHIP claims data at Medicare rates, with some limited exceptions for some services provided predominantly in Medicaid and CHIP.

ARP Rural Distribution: Providers who serve Medicaid, CHIP, and Medicare patients who live in rural communities are eligible for the ARP Rural payments.

  • HHS will make payments to providers based on the amount and type of Medicare, Medicaid, and Children’s Health Insurance Program (CHIP) services provided to rural patients.
    • HHS will price Medicaid and CHIP claims data at Medicare rates, with some limited exceptions for some services provided predominantly in Medicaid and CHIP.
    • Providers who serve any patients living in Federal Office of Rural Health Policy-defined rural areas with Medicaid, CHIP, or Medicare coverage, and who otherwise meet the eligibility criteria, will receive a minimum payment.

Terms and Conditions: To help ensure that these provider funds are used for patient care, PRF recipients will be required to notify the HHS Secretary of any merger with or acquisition of another healthcare provider during their Payment Received Period. Providers who report a merger or acquisition may be more likely to be audited to confirm their funds were used for coronavirus-related costs, consistent with an overall risk-based audit strategy.

Date Last Reviewed:  September 2021