HHS Phase 3 Relief Announced

10/03/2020 12:43:45 PM

HHS Phase 3 Relief Announced

The Department of Health and Human Resources has announced a new round of relief funding. The portal will be open from October 5 through November 6, 2020. Apply early if you’re eligible!  

So, who’s eligible?

The new round is primarily to benefit two groups that were previously excluded:

  • Practices that opened between January 1 and March 31, 2020.  You were not previously eligible to apply because you had no prior year patient fees.
  • Practices that received a small payment under the general distribution (phase 1).  Round 2 payments were much larger—2% of prior year revenues.  But if you received a phase 1 payment, you weren’t eligible for a phase 2 payment.  You missed out on the more substantial relief.  The new distribution supplements the first payment up to the 2%-of-revenue amount.

Add-on Payment

Also, practices that have already received benefits can apply for an add-on payment for lost revenue.  This is over and above the 2% payment described above, or that you’ve already received.  But approach this add-on with caution! 

Current HHS guidance indicates this may mean reduced net income rather than straight patient fees.  Using that definition, many practices will not ultimately show a decrease in net income for 2020 because expenses paid with PPP funds must be excluded from the calculation.  Many practices are also reporting patient fees trending over 2019.  But they’re reporting lower expenses.  They’re running leaner since the start of the pandemic.  Again, this results in higher net income, not lower.  And if the calculation is truly based on patient fees, and if your practice is one that is trending up from 2019, you won’t qualify for the relief even under the more relaxed definition. 

Consider whether you need it to operate your practice at this point before applying.  HHS relief not used according to the requirements must be returned.

When October 5 arrives and we can see the actual application, we hope to be more enlightened! Click here for the full news release.