Skip to main content

Additional HHS Funding for Skilled Nursing Facilities

Tiffany Karlin

August 10, 2020

The Department of Health and Human Services (HHS), has announced plans to distribute approximately $5 billion to nursing home providers through the Provider Relief Fund (PRF) distribution. Specific details on this program have not yet been published on the HHS website. Funds received are meant be used to protect residents of nursing homes and long-term care facilities from the impact of COVID-19.

The $5 billion distribution will provide approximately $2.5 billion in upfront funding to support increased testing, staffing, and PPE needs. There will also be funding available for those establishing “COVID isolation” facilities.

Please note, unlike prior funds received, these funds will be linked to nursing home performance. Due to almost 40% of all U.S. COVID-19 deaths deemed nursing-home related, the intent of performance-based distribution will be to ensure the Federal Government is paying for “better outcomes”. Performance measurement will be viewed within geographical areas and efforts made to minimize COVID spread and related fatalities.

The initial $2.5 billion nursing home distribution is expected to occur in mid-August; per American Healthcare Association (AHCA), and they believe this distribution will occur over the next 10 days. This money, like the first Provider Relief Fund, should be automatically transferred to provider banking accounts. THIS WILL NOT BE AN APPLICATION PROCESS. These dollars will be followed by additional performance-based distributions throughout the Fall.

Further information published by AHCA detailed that during HHS’s briefing, they indicated skilled nursing facilities that received an “on-site testing machine” will receive an average of $90,000. HHS did not provide further details to determine how this amount is being calculated. If your facility did not receive a testing machine, the average to each facility will be about $170,000. HHS believes costs to those without a machine will incur higher testing costs, and will thereby receive greater funds.

Following this distribution, HHS is allocating $500 million as a reward to buildings that are successful in keeping COVID out of buildings, or at low levels. AHCA released the information from HHS below:

  1. There will be four one-month measuring periods; September, October, November and December of 2020; 
  2. Buildings whose average new case count of COVID-19 is at, or below other buildings in the same county will receive a payment;
  3. Each month is a new counting period and there is a separate payment each month. If you miss September, you can still succeed in October, November etc. There will be a total of four separate payments;
  4. They will pull data from the CDC NHSN portal to calculate this information and make these payments; and
  5. New residents who are positive upon admission do not count against a facility for this incentive payment. 

Information has not been formally released regarding distribution amounts for quality improvements, but, as AHCA reports, if half of all buildings qualify, and HHS does not use other qualifiers, an estimated monthly payment would be $70,000 on average.

As noted, this is all the information we know today. Our team at Mueller Prost is monitoring the HHS, CMS, AHCA, LeadingAge, and NAHC forums to ensure our clients care is kept current and you can act proactively.

Image of a woman at a computer with the words "Put our expertise to work. We combine deep industry knowledge, experience and innovation to solve your company's most complex problems." Click to talk to an advisor.

Unlock industry secrets.

Mueller Prost insights, delivered right to your inbox.

Sign Up.

Related Insights