Healthcare Providers: Key Considerations before Accepting Provider Relief Funds

On April 10, 2020, the U.S. Department of Health and Human Services (“HHS”) started distributing $30 billion of the $100 billion in funds appropriated under the CARES Act’s Public Health and Social Services Emergency Fund (the “Relief Fund”) to healthcare providers.

On April 22, 2020, HHS announced that it would begin distributing an additional $20 billion based on a percentage of each provider’s 2018 net patient revenue from all payors.

Although there is no obligation to repay the Relief Funds, providers should recognize a number of considerations before accepting the funds.

What is the Provider Relief Fund?

The CARES Act appropriated $100 billion to the Relief Fund for hospitals and healthcare providers battling the COVID-19 disease. On April 10, UnitedHealth Group, tasked by HHS to administer the distributions, started distributing $30 billion of the Relief Fund to healthcare providers in a proportionate amount based on the provider’s Medicare fee-for-service reimbursements in 2019. In fact, each provider should expect to receive approximately 6.2% of its 2019 Medicare fee-for-service payments.

On April 24, HHS began distributing an addition $20 billion to providers based on each provider’s 2018 net patient revenue from all payors, not just Medicare fee-for-service. If a provider already submits revenue data via CMS cost reports, it should expect a direct deposit. However, providers without adequate cost report data must apply for these additional funds at Importantly, providers who receive their money automatically must still submit their revenue information so that it can be verified.

HHS has stated that it expects to allocate the remaining amount of the Relief Fund to: providers in COVID-19 high impact areas; providers engaged in treating uninsured patients; rural health providers; Indian health services; and providers that accept a high number of Medicaid patients.

Unlike the interplay of other CARES Act provisions, providers may avail themselves of the Relief Fund and other COVID-19 relief, such as Medicare Advanced Payments, Paycheck Protection Program, and Economic Injury Disaster Loans.

Are there Strings Attached to the Relief Funds?

Providers must attest to receiving the Relief Funds and consent to the program’s terms and conditions within 30 days of receipt. Providers must complete the attestation portion via the online payment portal located at By signing the attestation, a provider is deemed to have made a number of certifications and consents to periodic reporting requirements.


A provider must certify that it provides, or provided after January 31, 2020, diagnoses, testing, or care for individuals with possible or actual cases of COVID-19.  Importantly, providers do not have to be currently taking patients so long as they were still seeing patients after January 31, 2020. Note also that care does not have to be specific to treating COVID-19. HHS broadly views every patient as a possible COVID-19 case.

A provider must also certify that it: billed Medicare in 2019; is not excluded from Medicare, Medicaid, and other Federal health care programs; and does not currently have their Medicare billing privileges revoked.

Furthermore, the provider must certify that the payment will be used to prevent, prepare for, and respond to COVID-19. These funds must be used to reimburse revenues or losses attributable to COVID-19. The provider cannot use the funds to reimburse expenses or losses that have otherwise been reimbursed from other sources. This would include such funds received from the Paycheck Protection Program and/or the Economic Injury Disaster Loan program. Providers must also agree not to balance bill any out-of-network patient for COVID-19-related treatment.

Reporting and Record Keeping

Providers that accept the Relief Funds will also be subject to various reporting requirements. Namely, HHS may request a provider to submit periodic reports to ensure the provider is complying with the use of the Relief Funds. HHS has not announced the extent and level of detail for these reports. However, HHS has made it clear that providers must maintain records and cost documentation of their use of the funds in accordance with 45 CFR § 75.302 (Financial Management) and 45 CFR § 75.361 through 75.365 (Record Retention and Access).

Moreover, a provider that receives over $150,000 in total funds under the CARES Act, or any other Act that was passed in response to COVID-19, must submit quarterly reports to HHS. A good example of this would be a provider that received funds from the Paycheck Protection Program and/or the Economic Injury Disaster Loans, and the total amount of reimbursements exceeds $150,000. In such cases, the provider should expect to document and report the following:

  • The amount of funds the provider received under COVID-19-related Acts;
  • The amount of funds received that were expended for each project or activity;
  • Detailed list of all projects or activities for which large covered funds were expended or obligated, including:
    • Name and description of the project or activity
    • Estimated number of jobs created or retained by the project or activity
  • Detailed information on any level of sub-contracts or subgrants awarded by the covered recipient or its subcontractors or subgrantees.


The use of Relief Funds is also subject to a variety of statutory limitations.  These include, but are not limited to, restricting the payment of funds as a salary to an individual in excess of $197,300 per year (Executive Level II), gun control advocacy, lobbying, embryo research, and abortion.

Risks for Misusing the Relief Funds?

HHS repeatedly insists that it intends to enforce the proper use of the Relief Funds.  HHS’ Office of Inspector General (“OIG”) is tasked with investigating and ensuring compliance with the terms and conditions. Indeed, failure to abide by the terms and conditions may result in liability under the False Claims Act.

To minimize risk of a claim under the False Claims Act, providers should keep detailed records of how they use the Relief Funds. To this end, providers should create necessary procedures to ensure the accurate tracking of the Relief Funds. If a provider is concerned that its use of the Relief Funds would violate the terms and conditions, they should document in writing the reasoning and legal justification for their particular use of the Relief Funds, and how that use is compliant with the terms and conditions. Such documentation will be helpful in responding to an OIG request or even a qui tam action to the extent there is a later claim of improper use of the Relief funds. Each provider should consult with counsel to determine the best approach to minimizing its exposure to a potential claim.

If a provider is unwilling to agree to the terms and conditions, it must contact HHS within 30 days of receipt and return payments as instructed.

We expect HHS to issue additional guidance in the coming days and weeks regarding these terms and conditions. For now, providers should consider whether they have the internal capabilities to track the use of the Relief Funds and ensure they can abide by all of the program’s terms and conditions.  If so, providers must sign their attestation within 30 days of receipt of the Relief Funds, and if not, they must return the funds within 30 days.

Our team at Cantey Hanger is staying up-to-date with all of the happenings surrounding the Provider Relief Fund. For more information, please contact David Speed at or Andrew Scott at