by Aimee L. Wilcox, CPMA, CCS-P, CST, MA, MT
Oct 15th, 2021
As we predicted over a year ago, federal audits are now underway to uncover any fraudulent misuse of emergency relief funds administered through the Provider Relief Fund (PRF). The PRF was a $175 billion fund created through the CARES Act to provide financial relief to healthcare providers during the public health emergency (PHE) caused by the COVID-19 pandemic. Over the past year, the Department of Health and Human Services (HHS) has hired outside contractors KPMG, Grant Thornton, PricewaterhouseCoopers, Kearney & Company, and Creative Solutions Consulting to audit PRF recipients, demonstrating their intent to ensure PRF monies have been justly disbursed.
Audits will be conducted to determine if providers properly reported the information required to obtain their portion of each phase of disbursement:
- Phase 1 - $50 billion (initial $30 billion followed by an additional $20 billion) paid to:
- Eligible facilities/providers who received Medicare fee-for-service (FFS) reimbursements in 2019
- Certain facilities/providers who closed their doors due to the COVID-19 pandemic
- Phase 2 - $18 billion available but only $5.98 billion paid due to fewer eligible candidates (60,832 recipients):
- Providers of state Medicaid programs (including MCOs), Children’s Health Insurance Program (CHIP), certain Medicare providers, assisted living facilities, and certain dentists.
- Phase 3 - $24.5 billion paid to 97,433 recipients:
- Providers previously eligible/paid during an earlier phase (deducting prior payment from eligible distribution)
- Previously ineligible providers meeting certain eligibility criteria
- Expanded group of behavioral health providers
- Healthcare providers performing COVID-19 testing, diagnosis, and administering COVID-19 vaccines to uninsured individuals
- Providers administering vaccines on or after December 14, 2020 to underinsured patients.
- Phase 4 - $25.5 billion (new funding), to be paid to:
- Healthcare providers who provided diagnosis, testing, or care for individuals with possible or actual COVID-19 after January 31, 2020
- Providers who serve rural Medicaid, CHIP, or Medicare patients
Audits are underway for providers who received/retained PRF payments and will require submission of supporting documentation such as:
- Data identifying how PRF funds were used
- Documentation supporting compliance with the terms and conditions of PRF payments
- Reports including:
- healthcare-related expenses attributable to coronavirus
- lost revenue attributable to coronavirus
- any other pandemic assistance received
- specifically requested administrative data (e.g., personnel, supplies) in greater detail for providers who received more than $500,000 in aggregate payments
Audit resources that should be thoroughly reviewed include:
- 45 CFR § 75 Subpart F
- 45 CFR § 75.302 - Financial management
- 45 CFR § 75.361-75.365 - Record Retention and Access
- 45 CFR § 75.305(b)(8) - Applicable exceptions
- Copies of original applications and documents submitted to request PRF funds
The initial provider/facility reporting was due September 30, 2021 and includes:
- Phase 1- General Distribution: Most payments
- Phase 2- General Distribution: Some payments.
Targeted Distributions: Some payments.
Please be advised that with some of these prestigious accounting and financial firms acting as PRF auditing contractors, details in submitted documentation is going to be very important. Be sure to begin your own internal audits now, prepare the necessary documentation for submission in a timely manner, and consult your healthcare attorney regarding any and all audit notifications.