Fearing CMS ‘Day of Reckoning,’ Home Health Providers Shy Away from Coronavirus Relief Funds

Home health providers were thrilled when they first heard they would be receiving “no strings attached” payments from the Provider Relief Fund, which was mandated by the CARES Act. However, agencies quickly learned that there was more to the story.

The grant funding comes with conditions, and confusion around those conditions has some home health operators wondering whether they should accept or reject the money.

The deadline for that decision is drawing near. Originally, the U.S. Department of Health and Human Services (HHS) told Medicare providers they had 30 days from the time they received their payments to sign attestations confirming they got the money and agree to the terms and conditions that come with it.


Last week, HHS announced it was extending that attestation deadline, giving providers 45 days rather than 30 to make up their minds. As such, Medicare home health providers who received their emergency relief payments on April 10, the first day possible, now have until May 24 to decide what to do.

Legal experts say there’s a lot riding on the decision.

“The federal government shoveled out all of this money so quickly without having a crystal clear rubric of what it could be used for and what the terms and conditions were,” S. James Boumil — senior partner and owner at Boston-area Boumil Law Office — told Home Health Care News. “I can see two or three years from now there’s going to be sort of like a day of reckoning.”


Boumil currently represents eight home health companies, two of which are considering filing bankruptcy as a result of industry disruption caused by the coronavirus. While federal relief efforts like HHS’s emergency payments are designed to help, they could merely be delaying the suffering, Boumil said.

“[Providers] do need extra funding to get through this crisis, but everyone is afraid that the funding is toxic,” Boumil said. “[They worry] that, given the complexity of the regulations, somebody could say later on, … ‘In our opinion, it wasn’t used for the right thing, and therefore, we want it back.’”

The CARES Act set aside $100 billion in emergency relief funding for health care organizations in light of the coronavirus, with $50 billion of that going to Medicare providers specifically.

While the money comes in the form of a grant, providers could be responsible for repaying it if they don’t meet certain terms and conditions. Some of the stipulations include rules that providers must be participating in the Medicare program and that “payment will only be used to prevent, prepare for and respond to coronavirus.”

But there’s a lot of confusion around exactly what some of those terms and conditions mean — enough to warrant discussion during a recent webinar by Milwaukee-based national law firm Foley & Lardner LLP.

“We had 300 people on it, and we usually get about a handful of questions after [webinars],” Chris Donovan, a transactional health care lawyer and partner at Foley, told HHCN. “We had over 200 questions about this whole attestation thing.”

For example, what should one do if they owned multiple agencies in 2019, but one of them no longer exists? How should providers document use of the funding? And when is an expense related to the coronavirus? The list goes on.

Confusion has prompted several high profile providers — such as Amedisys Inc. (Nasdaq: AMED) and LHC Group Inc. (Nasdaq: LHCG) — to proceed with caution.

“We expect written clarification in the coming days, on the formula and the distribution of funds,” Amedisys CEO President and CEO Paul Kusserow said last week during the company’s Q1 2020 earnings call. “At this time, we have fully segregated these funds into their own account and will not be utilizing them until final written guidance is received from HHS.”

In April, Amedisys received $100 million in relief as part of the first round of emergency funding based on 2019 fee-for-service Medicare revenue.

Meanwhile, LHC Group received $87.5 million, with the ability to use that money dependent “on the magnitude, timing and nature of the economic impact of COVID-19 within LHC Group, as well as the guidelines and rules of the federal relief program itself,” CFO Josh Proffitt explained on the company’s Q1 earnings call.

LHC Group’s call came just one day after HHS published its latest set of updates to the FAQs on provider relief funding.

The guidance has cleared up a lot, such as what a provider should do if they believe they’ve been overpaid (reject the funding and submit appropriate revenue documents to the general distribution portal); whether there’s a ban on balance billing for all patients (no); and how HHS defines a presumptive case of COVID-19 (when a patient’s medical record supports the diagnosis, even if the patient didn’t get a test).

The FAQs also gave LHC Group some newfound confidence on the funding.

“Based on the guidance that was just [recently] released … , and the additional color in the terms and conditions and the FAQs, we feel very confident that the last revenues in the month of April will qualify and be able to be allocated for use of the funds,” Proffitt said on the earnings call.

But, still, questions remain, some of which need to be answered sooner rather than later. Take those related to documentation, for example.

Providers will eventually be required to report how they used their emergency relief money to pay for coronavirus-related expenses or lost revenue; but they don’t know exactly what type of documentation will be required.

“HHS will provide guidance in the future about the type of documentation we expect recipients to submit,” according to an HHS FAQ update added May 6.

That guidance needs to come soon, Donovan said.

“If you’re a provider and you haven’t seen the form that says ‘this is how I’m going to have to report it in July,’ how can you, in the middle of May, say, ‘I’ll take that money right now?’” he mused.

All the questions add up to another: When will agencies have the answers they need to confidently accept the funds?

“What we’re being told is within that additional 15 day period, that there’ll be [more] FAQs responding to some of the questions that have been raised so far,” Donovan said. “Will they answer every question that we’ve got? Probably not.”

Unfortunately, those remaining answers could come years from now in court, during that ominous day of reckoning Boumil foreshadowed.

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