HHS giving $9 billion to providers affected by pandemic

Average payment for small practices is $58,000

The U.S. Department of Health and Human Services announced it is distributing approximately $9 billion to health care providers who have experienced revenue loss or expenses related to COVID-19.

The average payment for small providers is $58,000, for medium providers is $289,000, and for large providers is $1.7 million. More than 69,000 providers in all 50 states, Washington, D.C., and eight territories will receive payments.

The PRF Phase 4 payments, in addition to the $8.5 billion in American Rescue Plan (ARP) Rural payments to providers and suppliers who serve rural Medicaid, Children's Health Insurance Program, and Medicare beneficiaries, are part of the $25.5 billion the Biden-Harris Administration is releasing to health care providers to recruit and retain staff, purchase masks and other supplies, modernize facilities, or other activities needed to respond to COVID-19.

“This vital funding will ensure critical health care services are delivered to communities across the country – including to those who are disproportionately impacted by the pandemic and medically-underserved,” said Health and Human Services Secretary Xavier Becerra in a statement. “We will continue to make health care accessible for everyone who needs it and reach people where they are.”

Approximately 75% of Phase 4 funding is being distributed based on expenses and decreased revenue from July 1, 2020 to March 31, 2021. HHS is reimbursing a higher percentage of losses and expenses for smaller providers – which generally entered into the COVID-19 pandemic on worse financial footing, have historically operated on slimmer financial margins, and typically care for vulnerable populations – as compared to larger providers.

Additionally, HHS has updated the terms and conditions for Phase 4 and ARP Rural payments to ensure relief funds are being used to address the financial impact of COVID-19. Recipients whose payment exceed $10,000 are required to notify HHS of a merger with or acquisition of any other health care provider. Providers who report a merger or acquisition may be more likely to be audited to ensure compliant use of funds.

View a state-by-state breakdown of the Phase 4 payments announced today.