The Department of Health and Human Services (HHS) announced that COVID-19 relief payments to hospitals, physicians, and other health care providers will begin arriving via direct deposit on April 10, 2020—to eligible providers throughout the U.S. health care system. The payments are grants, not loans, and do not have to be repaid.
These payments come from the first $30 billion of the $100 billion that Congress allocated to the emergency fund to support health care providers during the COVID-19 pandemic through the Coronavirus Aid, Relief, and Economic Security (CARES) Act. This initial allocation is being directed to hospitals and physician practices in direct proportion to their share of Medicare fee-for-service (FFS) spending in 2019. For example, if a Medicare provider with a Taxpayer ID Number (TIN) accounted for 1% of total Medicare FFS spending in 2019, that TIN would receive 1% of the $30 billion.
The plan to distribute initial emergency fund payments partly reflects the recommendations that the Association for Clinical Oncology (ASCO) and more than 130 other medical societies made to tie the payments to physicians' Medicare FFS spending from a portion of 2019. However, instead of using the recommended one-month average of three months of Medicare spending, it uses Medicare spending for all of 2019.
The plan also does not use any methodology to pay physicians who have no or very few Medicare claims but who rely significantly on Medicaid funding. However, Centers for Medicare & Medicaid Services Administrator Seema Verma indicated that a subsequent allocation from the emergency fund will be directed to pediatricians, children's hospitals, and others who rely on Medicaid.
All facilities and health professionals that billed Medicare FFS in 2019 are eligible for funds. Funds will go to the TIN for each organization that receives Medicare payments, not individual physicians. The automatic payments will come to organizations via Optum Bank with "HHSPAYMENT" as the payment description.
Read more about the initial payments. HHS will determine how the remaining $70 billion allocated in the CARES Act will be disbursed at a later date.