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Medicare Providers Could Receive Unexpected Funding from the CARES Act

April 10, 2020

***Note: The information within is subject to change.  We are not specialists in Medicare/Medicaid and are sharing information as we understand it. ***  

If you’re a healthcare provider who has accepted Medicare payments this is important information for you and your practice.  

This week, some healthcare providers received a deposit of funds from Medicare that they were not expecting, which raised many questions including:

  • What is this payment?
  • Will I receive more payments?
  • Will it need to be repaid?

The CARES Act contains many provisions to support the healthcare delivery system that impacts healthcare providers who process Medicare payments.

This provision can be found under Title VI – Miscellaneous Provisions of the CARES Act. This Title of the Act is a catch-all of many items, but one specific section deals with the Office of the Secretary Public Health and Social Services Emergency Fund. In this section, $100B was appropriated to the Public Health and Social Services Emergency Fund (‘the fund”) that is available to “prevent, prepare for, and respond to coronavirus, domestically and internationally, for necessary expenses to reimburse…eligible healthcare providers for healthcare related expenses or lost revenues that are attributable to coronavirus.” Eligible healthcare providers are defined as “public entities, Medicare or Medicaid enrolled suppliers and providers…that provide diagnoses, testing, or care for individuals with possible or actual cases of COVID-19.”

The fund is being administered by the US Department of Health and Human Services (“HHS”).  The HHS is disbursing $30B as an “immediate infusion” via direct deposit. The payments are not a loan and will not need to be repaid, assuming you meet certain terms and conditions.  One of the requirements that stands out to us is the recipient has to certify “that the payment will only be used to prevent, prepare for, and respond to coronavirus, and shall reimburse the Recipient only for healthcare related expenses or lost revenues that are attributable to coronavirus.”  

We realize this will raise questions, many of which we have answered below based on information provided by the HHS and our interpretation of the CARES Act.  Additional guidance will be issued by the HHS and we will continue to monitor it for updates.

Q: What do I have to do if I receive a payment?
A: Within 30 days of receiving the payment, providers must sign an attestation confirming receipt of the funds and agreeing to the terms and conditions of payment. The attestation will be made on a portal on the HHS page, which is expected to be available the week of April 13, 2020.  If you receive payment and do not wish to comply with the terms and conditions, you must contact HHS within 30 days of receipt of the payment and remit the full payment to the HHS.  Contact information for this purpose is not yet available.

Q: If my office is currently closed am I eligible to receive this payment?
A: If you process Medicare claims, it is possible that you will or have already received this payment.  We encourage you to read the terms and conditions thoroughly to determine if you qualify. The Terms and Conditions state that you must be treating COVID-19 cases to qualify for this payment.  However, you have 30 days to agree to the Terms and Conditions and we expect additional guidance will be released in the coming days. Until that happens, we recommend that you do not spend the funds.


Q: What is considered lost revenue for purposes of this payment?
A: At this time, there is no clear definition of what constitutes lost revenues.  We expect this to be clarified in future guidance.

Q: Who is eligible to receive funds from the initial $30B?
A: All facilities and providers that received Medicare fee-for-service (FFS) reimbursements in 2019 are eligible.

Q: Do I need to apply to receive this payment?
A: Administrator Verma has stated that providers who receive Medicare payments electronically would not need to apply and would receive funding automatically. Providers that do not receive their Medicare payments electronically would need to complete an application.  No details on this process have been released, however.

Q: How are payments determined?
A: Providers will be distributed a portion of the initial $30B based on their share of the total 2019 Medicare FFS reimbursements.  Total FFS payments were approximately $484B in 2019. The HHS has provided the example below to estimate your payment.

Example: A community hospital billed Medicare FFS $121M in 2019. To determine how much they would receive, use this equation:
($121,000,000/$484,000,000,000) x $30,000,000,000 = $7,500,000

Q: Will this payment be sent to individual physicians?
A: No. The payment will be sent to the employer organization as it is tied to the Taxpayer Identification Number (TIN) under which Medicare claims are filed.

Q: How will I know if I have received a payment?
A: The HHS is direct depositing these funds to the recipient’s bank account and is alerting the recipient of the deposit via email. The email is originating from We recommend that you check the bank account where Medicare deposits are normally made and search for a payment with an “HHSPAYMENT” description.

Q: Does this stimulus payment prevent me from participating in the PPP Loan Program?
A: At this time it is unclear as this has not been directly addressed by the government agencies.  The CARES Act contains language indicating funds from the HHS stimulus “may not be used to reimburse expenses or losses that have been reimbursed from other sources.”  Based on this language it would seem that any HHS funds received through this stimulus payment cannot be used for qualified expenses used for the loan forgiveness provision of the PPP Loan Program.

Q: Will I have to substantiate the expenditures?
A: The Act requires that recipients submit reports and maintain documentation as the Secretary of the HHS determines is necessary to ensure compliance.  Additional guidance will be needed.

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