The American Hospital Association (AHA) is imploring the Biden administration to give some hospitals more time to spend their relief dollars ahead of a June 30 deadline.
The AHA wrote to Department of Health and Human Services (HHS) Secretary Xavier Becerra for flexibility on next week’s deadline as they warn that the pandemic is still impacting facilities. A few weeks ago, HHS did give more time, but only if a provider got that funding after June 30, 2020. A provider that got money before that date must still abide by the June 30, 2021, deadline.
“Some providers will need to spend their funds well before others simply because they received a [provider relief fund] payment earlier in the distribution process,” the letter said. “This is particularly acutely felt since a large amount of the [provider relief funds]—well over half—were distributed on or before June 30, 2020.”
The $178 billion fund passed as part of the CARES Act last year and was intended to help hospitals plug major revenue shortfalls caused by sudden drops in patient volumes. Hospitals across the country were forced to cancel or postpone elective procedures at the onset of the pandemic in order to preserve capacity to fight the virus, and patient volumes also suffered greatly at outpatient facilities due to fears of contracting COVID-19.
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HHS initially distributed funding to providers based on their Medicare claims but then gave out targeted allocations based on COVID-19 hot spots and to rural providers.
However, a hospital did not have to immediately put the funding on their books. The relief funds did help several major hospital systems weather the drops in revenue that occurred in the second quarter of 2020.
AHA, other provider groups and some lawmakers had pressed HHS to give flexibility on the June 30 deadline by which all relief funds had to be spent.
The agency added that roughly $24 billion in the relief fund has yet to be distributed.
AHA said in its Wednesday letter that hospitals are continuing to experience increased expenses and lost revenues. The group also warned that while COVID-19 cases have slowed since the peak in January, caseloads and hospitalizations are starting to increase in certain pockets of the U.S.
“For example, for the week ending June 20, cases in nine states increased week-over-week, with several states increasing by double digits,” AHA wrote.
Hospitals are also still experiencing higher costs related to providing care such as increased prices for staff and equipment.
“Hospitals and health systems must be able to apply their [provider relief fund] money toward these cots, which they will undoubtedly continue to incur beyond June 30,” the AHA letter said.
Centers for Disease Control and Prevention Director Rochelle Walensky, M.D., said she is worried about “pockets of this country that are less vaccinated than others.”
There may be an “uptick in cases but we are working hard to make sure that is not the case,” she said during the Milken Institute Future of Health Summit on Wednesday. She added that nationally, cases are down to around 11,000 a day, which is lower than at the onset of the pandemic in March 2020.