Following Letter from Klobuchar and Smith, HHS Expands Relief For Rural Health Care Providers

Press Release

U.S. Senators Amy Klobuchar (D-MN) and Tina Smith (D-MN) announced that following their letter earlier this month to U.S. Department of Health and Human Services (HHS) Secretary Alex Azar, the Administration has expanded relief eligibility for rural health care providers and updated requirements to preserve providers' access to funding from the Provider Relief Fund (PRF) created as a response to the coronavirus pandemic.

"As we continue to face challenges from the pandemic, rural areas are in need of critical support," Klobuchar said. "This announcement is welcome news and we must continue to work with rural hospitals and health systems in Minnesota and around the country to help ensure that they can continue to serve low-income, elderly, and severely ill patients through this difficult time."

"We need to help health care providers in small towns and rural areas stay afloat so they can continue their critical work during COVID-19," Smith said. "Some health care providers are having to lay people off while anticipating surges in patients this winter. This puts them in an impossible position. The last thing we should do is change the requirements for the Provider Relief Fund, which may force some health care providers to return funds they have already received."

HHS is allowing more flexibility for providers in using PRF proceeds so that they can continue to respond to all of the challenges posed by the coronavirus pandemic. This will help to protect patients' access to care and prevent providers -- especially rural hospitals and hospitals that serve high-numbers of low-income, elderly, and severely ill patients -- from being forced to return PRF funds that they have already received.

HHS released initial reporting requirements in June for providers receiving PRF funds that directed these entities to define lost revenue as "any revenue that you as a health care provider lost due to coronavirus, " but HHS released updated reporting requirements on September 19 that directed providers to instead use changes in their net operating income to calculate lost revenue -- a substantial change from the initial June guidance that was expected to reduce the amount of lost revenues that providers are able to report. That shift in reporting requirements would have changed the terms of the relief as hospitals and health systems initially understood them and likely created further uncertainty for providers at a time when they are already facing serious financial challenges.

Earlier this month, Klobuchar and Smith led 20 colleagues in a letter to the U.S. Department of Health and Human Services (HHS) Secretary Alex Azar, expressing concerns about that change in reporting requirements for hospitals and health systems that receive relief funds from the Provider Relief Fund (PRF). That change could have forced providers to return relief funding that they had already received. Rural hospitals and hospitals that serve high numbers of low-income, elderly, and severely ill patients -- could have been particularly burdened by the additional reporting requirements, due to their already thin financial margins.

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