HHS STIMULUS DEPOSITS TO PHYSICIAN PRACTICES April 14, 2020 By: Maureen West McCarthy On Friday, April 10th medical practices started to notice large deposits appearing in their business checking accounts labeled “HHS Payment US HHS Stimulus”. As this occurred, the questions started rolling in. The questions included why did I get this money; do I have to pay it back; and what can it be used for? In the following article, we will attempt to outline the particulars of this Program and focus on the most important issues and obligations included in this distribution of funds. Summary: HHS, as a part of the CARES Act, allocated $100 billion for hospitals and providers. The initial allocation of the HHS Stimulus monies in the amount of $30 billion dollars was disbursed on April 10, 2020. The purpose of this money was to assist frontline providers as they care for COVID19 patients and shift their clinical focus to these efforts. This includes: moving away from office visits to telehealth visits and phone calls, pre-screening and interviewing all office patients, and allocating resources to identify COVID19 patients who need to be sent for testing or patients that are at a higher risk for the virus and managing those patients to keep them well. It would also include practices who shuttered their offices and canceled elective procedures for the safety of the community. It is important to note, these payments are not loans and do not need to be repaid if the attestation is signed and the conditions are met. These funds are completely different than the CMS Accelerated and Advance Payment Program. Again, these payments were made as part of the Department of Health and Human Services’ Provider Relief Fund (more information on the fund can be found HERE). Allocation and Calculation of Amounts: The money disbursed on Friday was issued based on a medical group’s Tax ID number, not individual providers. HHS contracted with United Health Group to assist in disbursing these funds from Optum Bank. The amount per practice was calculated based on total 2019 FFS Medicare payments for each practice. That number was then divided by the total of all Part B Medicare payments ($484 billion) and then multiplied by the total $30 billion disbursed. This calculation will allow you to see what you should receive or to check the amount you did receive. If for some reason you do not normally collect your Medicare payments by automatic deposit, you will be receiving a check by mail. Medicare Advantage plans are not included in these calculations. The next round of money is supposed to be earmarked for physicians who may not see Medicare patients and could be based on Medicaid volume. The second round of money will be earmarked for pediatric hospitals, pediatricians and pediatric specialists. Attestation and Obligation for this Funding: Within 30 days of receiving the HHS Stimulus funds, a practice must go online to the HHS portal and attest that they agree to follow the conditions of receiving the HHS funds including that they will use the money to “prevent, prepare for, and respond to the coronavirus… including for health care related expenses or lost revenues that are attributable to coronavirus including shutdowns. “ If a practice does not believe they will use this money as required or is unwilling to attest, they must contact HHS and make arrangements to return the money. Another obligation of this funding is that a healthcare provider must not balance bill a patient seeking Covid19 services for more than a patient would normally pay an in-network provider (i.e., co-pay, co-insurance, deductible portion, etc.) for those services. The CARES Act requires that commercial carriers pay a practice in full (with -0- patient portion) for all COVID19 services. Please check your EOB’s to make sure this is being done correctly. The last thing of note is that HHS monies can not be used for Executive salaries higher than an Executive Level II. We believe this affects hospitals more than medical practices. In review, this money is a welcome relief to many medical practices waiting to hear about their PPP or EIDL loans who are trying to provide medical services during this difficult time. Again, The funds can be used either to keep the practice office open as necessary, to move as many services as possible to an electronic visit format, or to simply close their office to protect their patients, staff and providers. Please let us know if you have any questions. We are here to help you through this unprecedented time. Stay well and be safe. We are stronger together. Article by: Maureen West McCarthy, CPA Maureen West McCarthy is a Principal and Managing Director of KatzAbosch’s medical practice management consulting group. Maureen works in tandem with our medical practice accounting service team. During Maureen’s career, spanning over 30 years, she has specialized in medical practice management consulting by working on a wide variety of practice management issues for private practice and health system physicians, hospitals, ASC’s, and medical billing companies. About KatzAbosch: Founded in 1969, KatzAbosch is one of the largest CPA and business consulting services in the Mid-Atlantic region. As an accounting firm, our mission is to provide the highest quality accounting, tax, financial and management consulting services to our regional clients. We understand the needs and challenges of our clients and we have made it our obligation to create, grow and protect asset value. KatzAbosch is consistently named a Best Accounting Firm to Work For in Accounting Today and has been named a Top 200 Accounting Firms in the Nation by Inside Public Accounting. Our firm is also ranked among the Top 15 Largest Accounting Firms in the Baltimore Area by the Baltimore Business Journal and a Top Workplace four times by The Baltimore Sun.