Company Reduction Fund Reporting Needs, Compliance Fears

In the latest installment of our “Let’s Talk Compliance” sequence, Foley & Lardner’s Alexis Bortniker and PYA’s Martie Ross answered numerous inquiries relating to Provider Reduction Fund (PRF) reporting prerequisites. A recording of the event is out there under.

Sad to say, there ended up additional queries from attendees than we could deal with in 45 minutes, so as a supplement to the July 16 party, we have compiled those people queries to offer you the next responses.

What “official” sources are obtainable to assist with reporting?

HHS’ Reporting Specifications and Auditing webpage includes inbound links to the June 11, 2021, Post-Payment Observe of Reporting Necessities related FAQs recordings of the 3 webinars HHS offered in July 2021 addressing reporting needs the Portal Reporting User Guide, and the extremely practical PRF Reporting Tutorial video. Also, you can contact simply call the Provider Guidance Line at (866) 569-3522 involving 8 a.m. to 10 p.m. CT, Monday via Friday.

Do the fees have to be entered as properly as the misplaced profits? Or can we just submit the dropped revenue data?

HHS dealt with this problem during its 7/20 webinar, stating just one has the option of reporting no expenditures for which PRF payments were being utilised. Notice, having said that, this may preclude the Reporting Entity from claiming COVID-linked costs incurred prior to 7/1/21 at a later on day (e.g., report on subsequent PRF payments).

Is dropped earnings primarily based on gross profits or internet income? What payments need to or ought to not be involved in affected individual care revenues?

Centered on our review of all available guidance, we believe the most defensible definition of “patient treatment revenue” for purposes of PRF reporting of dropped profits is the market normal “net affected individual assistance income,” i.e., gross income less earnings deductions less implicit price tag concessions. To make certain a valid comparison between time intervals (i.e., 2019, 2020, and Q1 and Q2 of 2021), HHS has instructed suppliers to subtract any income relating to individual products and services not furnished in the course of the time time period (e.g., supplemental payments, value report settlements, A/R changes relating to prior several years). (Note that no adjustment really should be manufactured to 2020/2021 individual treatment revenue to account for greater payment prices owing to COVID-19 (e.g., suspension of Medicare sequestration, HRSA COVID-19 promises reimbursement for screening, treatment method, and vaccine administration for the uninsured) no individual care revenue—including these greater payment rates—should be involved under “Other Help Received”). Any supplemental changes supposed to “normalize” patient care earnings for purposes of comparing time periods would require a person to use the 3rd alternative for calculating dropped revenue (alternate affordable strategy).

We observe the the latest July 15 FAQ introduces some confusion with regards to prices, payments, and contractual adjustments. The FAQ indicates the definition of income is gross charges, which is not consultant of readily available funds to deal with charges. We observe this FAQ is inconsistent with references in HHS’ Reporting Portal Person Guide, which uses the term “actual revenues/internet rates been given … for patient care” repeatedly. By working with the phrase “received” somewhat than “billed,” HHS plainly indicates net earnings – not gross income – ought to be claimed.

Do capitation payments count as patient treatment income?

We think that entities ought to abide by their historical basis of accounting (such as earnings recognition policies) to account for capitation payments and other price-based mostly treatment payments.

Are Medicare Innovative/Accelerated Payments received, but necessary to be repaid, incorporated in “Other Assistance”?

Medicare Progress payments are NOT provided in Other Guidance Gained. The exact same is legitimate for Paycheck Protection Program funds that have not been forgiven.

Choice 3 for missing revenues only asks for losses in total, when selections 1 and 2 inquire for losses by the payor. Is HHS expecting option 3 to also report by the payor?

The portal involves input of a solitary quantity for shed income for a offered quarter there is no option to report by the payor. HRSA has not placed any specific requirements on alternative 3, besides to point out it is the Reporting Entity’s stress to show reasonableness.

What constitutes obligated money for FEMA? Is it when the applicant receives cash or when the grant is authorised?

In accordance to the FAQs, “[i]f a service provider has submitted an software to FEMA but has not nonetheless obtained the FEMA resources, the company need to not report the requested FEMA amounts in the Supplier Relief Fund report. If FEMA cash are obtained all through the similar Payment Gained Interval in which the company is reporting on the use of Supplier Aid Fund payments, the receipt and software of each individual payment sort is demanded in the Provider Aid Fund reporting method. If an entity receives a retroactive payment from FEMA that overlaps with the interval of availability, the entity will have to not use the FEMA payment on charges or dropped revenues previously reimbursed by Service provider Aid Fund payments.”

Our group gained cash on 08/04/2020. Should we hold out till immediately after September 30, 2021, to report?

The firm have to use these funds by December 31, 2021, and have to report on the use of funds in between January 1, 2022, and March 31, 2022. These funds cannot be integrated in the report relating to cash gained by June 30, 2020.

What if our basis elevated income for “COVID”?

If the donations ended up precisely earmarked for COVID reduction and cannot be employed for any other objective, they need to be incorporated as “Other.”

Is subsidiary defined by GAAP or tax return consolidated?

To identify no matter whether an entity is the mother or father group, the entity will have to observe the methodology employed to figure out a subsidiary in their economical statements. If none, the entity with vast majority possession (larger than 50%) will be thought of the mother or father corporation.

Make sure you observe, our PRF guidance is based mostly on our ideal judgment of the available data in a quickly switching and uncertain surroundings. The rules are speedily evolving and should be checked regularly.  As these types of, this blog site is a snapshot in time.

Enjoy a recording of the newest installment of our “Let’s Communicate Compliance” sequence below: