The limitation only applies to the rate of pay charged to Provider Relief Fund payments and other HHS awards. Remaining applications require additional manual review and HRSA is working to process them as quickly as possible. HHS will only accept corrections within the 5-day time period that are accompanied by a justification for why the provider erred in the initial data submission. One survey finds that 92% of providers receiving funds relied on them to help stay open and nearly half used them to repay debt incurred during the pandemic. All recipients are subject to audit. Providers have at least 12 months, and as much as 18 months, based on the payment received date, to control and use the payments for expenses and lost revenues attributable to coronavirus incurred during the Period of Availability. Key Dates Any changes in ownership that have not occurred should not be included in your revenue submission. TheCARES Act Provider Relief Fund Payment Attestation Portalor theProvider Relief Fund Application and Attestation Portalwill guide you through the attestation process to accept or reject the funds. To be eligible for the General Distributions, a provider must have billed Medicare fee-for-service in 2019, be a known Medicaid and CHIP or dental provider and provide or provided after January 31, 2020 diagnoses, testing, or care for individuals with possible or actual cases of COVID-19. The parent organization (an eligible health care entity) must substantiate that these funds were used for health care-related expenses or lost revenue attributable to COVID-19, and that those expenses or losses were not reimbursed from other sources and other sources were not obligated to reimburse them. The U.S. Department of Health and Human Services (HHS) posted a recent update to its Provider Relief Fund frequently asked questions (FAQ) with important tax information for physicians. Notwithstanding this general rule, the IRS indicated that the payment may be subject to tax under Section 511 of the Code to the extent the payment is used to reimburse the provider for expenses or lost revenue attributable to an unrelated trade or business as defined in Section 513 of the Code. If a Reporting Entity that received an ARP Rural payment indicates when they report on the use of funds that they have undergone a merger or acquisition during the applicable Payment Received Period, this information will be a component that is factored into whether an entity is audited. Suite. Providers must follow their basis of accounting (e.g., cash, accrual, or modified accrual) to determine expenses. Tax-exempt health care providers would not be subject to a tax on these funds. March 31, 2022, the end of the second reporting period for providers receiving one or more PRF payments exceeding $10,000 in aggregate between July 1 and December 31, 2020. The U.S. Department of Health and Human Services (HHS), through the Health Resources and Services Administration (HRSA), is making more than $2 billion in Provider Relief Fund (PRF) Phase 4 General Distribution payments to more than 7,600 providers across the country this week. environment open to Thomson Reuters customers only. All providers that received a payment from the Provider Relief Fund and retain that payment for at least 90 days without rejecting the funds are deemed to have accepted the Terms and Conditions. This is the fourth round of PRF Phase 4 payments, totaling nearly $12 billion that has been distributed to more than 82,000 providers in all 50 states, Washington D.C., and five territories since November 2021. Form 1099s will be mailed by January 31, 2023. Commercial organizations have two options in fulfilling the audit requirement: 1) an audit in conformance with the requirements of 45 CFR 75 Subpart F (single audit), or 2) a financial audit of the award or awards in accordance with Government Auditing Standards. The money received is taxable income. These data displayed on the website will be updated biweekly. Hospital finance leaders, advisers and hospital advocacy groups say they have received insufficient responses to clarifications they requested from HHS in recent weeks about details surrounding $50 billion in provider funding from the Coronavirus Aid, Relief and Economic Security (CARES) Act. Step 1: Preview the form, then click "Continue." HHS broadly views every patient as a possible case of COVID-19. HHS will not issue a new payment to a provider that received and then subsequently submitted a full or partial return of a payment, using either the attestation portal or Pay.gov, if the rejected payment and potential new payment are within the same distribution. Prior to joining the firm in 2005, he specialized in mergers & acquisitions and commercial real estate at a prominent New York law firm. accounting, Firm & workflow HHS reserves the right to audit Provider Relief Fund recipients now or in the future, and may pursue collection activity to recover any Provider Relief Fund payment amounts that have not been supported by documentation or payments not used in a manner consistent with program requirements or applicable law. Step 3: Verify the interest return payment amount and select to pay by ACH or debit/credit card, then select "Continue." Step 4: Enter the required information to complete the payment, then select "Review and Submit." Some Terms and Conditions relate to the provider's use of the funds, and thus they apply until the provider has exhausted these funds. Any practitioner that received a distribution should consult with their tax advisor to determine the tax liability associated with receipt of this payment and whether estimated tax payments need to be made. U.S. Department of Health & Human Services, Health Resources & Services Administration, description of the eligibility for the announced Targeted Distributions can be found here, Instructions for returning any unused funds, Provider Relief Attestation and Application Portal, Post-Payment Notice of Reporting Requirements, CARES Act Provider Relief Fund Payment Attestation Portal, Provider Relief Fund Application and Attestation Portal, Provider Relief Fund Payment Attestation Portal, Phase 4 and/or ARP Rural payment methodology, public list of providers and their payments, Center for Disease Control and Prevention's (CDC) website, HRSA Health Resources and Services Administration, PRB Provider Relief Fund General Information FAQ, Renovation or construction that was completed, Tangible property ordered, but need not have been delivered. Ohio specifically addresses the HHS Provider Relief funds, stating that these funds are not excluded from a taxpayer's gross receipts for purposes of the CAT. Although there is some flexibility in calculating lost revenue, HHS noted recipients could use any reasonable method. Providers that have not received payments under the Provider Relief Fund due to issues related to change of ownership will be eligible to apply for future allocations. The IRS indicated that payment from the Provider Relief Fund do not qualify as qualified disaster relief payments under Section 139 of the Code. PRF payments received in the first half of 2022 can be used until June 30, 2023. For general media inquiries, please contactmedia@hhs.gov. If HHS identifies a payment made incorrectly, HHS will recover the amount paid incorrectly or overpaid. Providers who submit updated data may have their payments delayed for up to 90 days from the date of submission pending review and adjudication. is a partner in Werfel & Werfel, PLLC, a New York based law firm specializing in Medicare issues related to the ambulance industry. of products and services. UnitedHealth Group No. Not every possible case of COVID-19 is a presumptive case of COVID 19. HHS may be able to offer additional support . Since these additional checks are coming so late in the year after we have already provided most of you with year-end tax planning, please reserve 40% of the HHS funds for additional taxes that will be owed in April. Relief Fund payments are approximately 6.2% of a provider's 2019 Medicare fee-for-service payments (not including Medicare Advantage). If the provider does not return the payment within 15 calendar days of rejecting the payment in the attestation portal, the provider is considered to have accepted the payment and must abide by the Terms and Conditions associated with the distribution. Until the purchase is complete, the organization should only report current gross receipts in its application and should exclude the practice it is intending to purchase. Comprehensive If reimbursement does not cover the full expense of administering vaccines, Provider Relief Funds may be used to cover the remaining associated costs. Some taxpayers question enforceability and whether they can rely on FAQs as authoritative guidance. Providers receiving payments from the Provider Relief Fund must comply with the Terms and Conditions and applicable legal and program requirements. Please reach out to your Aprio Relationship Partner or, HHS Deems Provider Relief Fund Distributions Taxable, Litigation Support & Forensic Accounting Services. Please refer to CMSFAQs- PDF (PDF - 1 MB)on how Provider Relief Fund payments should be reported on cost reports. Other Terms and Conditions apply to a longer time period, for example, regarding maintaining all records pertaining to expenditures under the Provider Relief Fund payment for three years from the date of the final expenditure. If a Reporting Entity chooses a different methodology, lost revenues by quarter will not pre-populate from the previous reporting period. In line with the Terms and Conditions, funds may not be used to reimburse expenses or losses that have been reimbursed from other sources or that other sources are obligated to reimburse, which include, but is not limited to, Medicare, Medicaid, and CHIP. Although it may seem complex, Art helps make sense of it to help you with strategic tax planning and maximize profitability in your practice. In posts to their respective website FAQs, the Department of Health and Human Services (HHS) and the Internal Revenue Service (IRS) have both clarified that grant payments received by for-profit providers from the HHS Provider Relief Fund shall be treated as taxable income. American Relief Plan Act Fund No HHS has not yet developed a process for eligible providers to apply for ARPA funds. Exemption for COVID-19 Relief Benefits . Nonetheless, a payment received by a tax-exempt health care provider from the Provider Relief Fund may be subject to tax under section 511 if the payment reimburses the provider for expenses or lost revenue attributable to an unrelated trade or business as defined in section 513. Yes. Providers who rejected one or more Provider Relief Fund and/or ARP Rural payments exceeding $10,000, in aggregate, and kept the funds are required to report on these funds during the applicable reporting period per the Terms and Conditions associated with the payment(s). The PRF Reporting Portal provides reporting requirements and auditing information related to recipients of PRF payments. Yes. On Wednesday, HHS is launching an enhanced Provider Relief Fund Payment Portal that will allow eligible Medicaid and CHIP providers to report their annual patient revenue, which will be used as a factor in determining their Provider Relief Fund payment. industry questions. Written by Brian Werfel on July 15, 2020. However, providers are not required to submit that documentation when reporting. All recipients receiving payments under the Provider Relief Fund will be required to comply with theTerms and Conditions. Providers may not use ARP Rural payments to reimburse expenses or losses that have been reimbursed from other sources or that other sources are obligated to reimburse. The IRS FAQ can be viewed in its entirety by clicking here. Are ALL providers subject to the Uniform Administrative Requirements? HRSA began distributing ARP Rural payments on November 23, 2021. Must know tax and reporting requirements of HHS provider relief fund distributions Thomson Reuters Tax & Accounting April 4, 2022 As a result of the CARES Act, the Provider Relief Fund (PRF) was created to reimburse eligible health care providers for increased expenses or lost revenue attributable to COVID-19. Investment advisory services are offered through Aprio Wealth Management, LLC, an independent Securities and Exchange Commission Registered Investment Advisor. Late on Friday evening (July 10, 2020) and less than a week before the looming July 15, 2020, tax deadline, the Department of Health and Human Services (HHS) finally issued guidance. In addition, the terms and conditions of the PRF payments incorporate by reference the obligation of recipients to comply with the requirements to maintain appropriate financial systems at 75.302 (Financial management and standards for financial management systems) and the requirements for record retention and access at 75.361 through 75.365 (Record Retention and Access). brands, Corporate income research, news, insight, productivity tools, and more. What other programs can help me? Provider Relief Fund recipients must use payments only for eligible expenses, including services rendered and lost revenues attributable to coronavirus, incurred by the end of the Period of Availability that corresponds to the Payment Received Period. and services for tax and accounting professionals. This amended guidance is in response to the Coronavirus Response and Relief Supplemental Appropriations Act (Act). The parent organization may allocate the Targeted Distribution up to its pro rata ownership share of the subsidiary to any of its other subsidiaries that are eligible health care providers. > News More for On January 15th, 2021, the U.S. Department of Health & Human Services (HHS) released updated guidance on the Provider Relief Fund reporting requirements. Four general distributions have been made, with the most recent distributions released in December 2021 and January 2022. Providers must follow their basis of accounting (e.g., cash, accrual, or modified accrual) to determine expenses. The Terms and Conditions for Phase 4 require that recipients that receive payments greater than $10,000 notify HHS during the applicable Reporting Time Period of any mergers with or acquisitions of any other health care provider that occurred within the relevant Payment Received Period. Recipients may use payments for eligible expenses or lost revenues incurred prior to receipt of those payments (i.e., pre-award costs) so long as they are to prevent, prepare for, and respond to coronavirus. No. Posted in Advocacy Priorities, Finance, Government Affairs, News. Q: Is a tax-exempt health care provider subject to tax on a payment it receives from the Provider Relief Fund? $10 billion set aside for additional EIDL, tax changes. > About "The payments to providers do not qualify as qualified disaster relief payments under section 139. Yes. If you affirmatively attested to a Provider Relief Fund payment already received and later wish to reject those funds and retract your attestation, you may do so by calling the provider support line at (866) 569-3522; for TTY dial 711. However, providers are not required to submit that documentation when reporting. Brian S. Werfel, Esq. To return any unused funds, use the Return Unused PRF Funds Portal. An insider's guide to the politics and policies of health care. Additionally, the opportunity to apply Provider Relief Fund payments (excluding the Nursing Home Infection Control Distribution) and ARP Rural payments for lost revenues will be available only until the conclusion of the quarter in which the Public Health Emergency expires. Advocacy Blog Tax & Finance. HHS and IRS guidance on this has not changed. But, there is an exception. HHS may consider providers that have only received a Provider Relief Fund General Distribution for priority under future General Distributions. Earlier this year, the federal government made Economic Impact Payments (referred to as stimulus or rebate payments) to individuals. If it is past the 90-day period for a General Distribution payment, you may apply for a Phase 2 General Distribution payment through theProvider Relief Attestation and Application Portal. 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