Regulatory and Tax Updates
New Provider Relief Fund Details Emerge, Reporting Portal Opens
- Recent revisions to the Provider Relief Fund (PRF) include new reporting time periods, deadlines, updated guidance, and single audit details.
- The date a PRF distribution is received determines the deadline for using the funds and when to report on those funds.
- The HHS released recent clarifications regarding lost revenue calculation.
- Single audits are required when entities expend $750,000 or more in federal awards in a fiscal year.
Need help understanding your PRF reporting requirements?
Throughout June and July, the Department of Health & Human Services (HHS) released important revisions to the Provider Relief Fund (PRF), including new reporting time periods, deadlines, updated guidance, and single audit details. HHS also opened the PRF Reporting Portal on July 1. As you prepare to report on funds, here’s what you need to know. Watch CLA’s previously recorded July 22 PRF webinar for additional insights.
1. Be aware of new deadlines, reporting periods
On June 11, HHS established new reporting periods and timelines. There are now four “periods,” which are dependent on the actual date a PRF distribution was received. Based on that period, a deadline is then established for that PRF distribution to be used. This is also referred to as the “period of availability.” Once the period of availability ends, PRF recipients will have 90 days to complete reporting on the PRF they received in that period.
Provider relief fund changes
|Payment Received Period (Payments Exceeding $10,000 in Aggregate Received||Deadline to Use Funds||Reporting Time Period|
|Period 1||From April 10, 2020 to June 30, 2020||June 30, 2021||July 1 to September 30, 2021|
|Period 2||From July 1, 2020 to December 31, 2020||December 31, 2021||January 1 to March 31, 2022|
|Period 3||From January 1, 2021 to June 30, 2021||June 30, 2022||July 1 to September 30, 2022|
|Period 4||From July 1, 2021 to December 31, 2021||December 31, 2022||January 1 to March 31, 2023|
As this graphics details, what PRF recipients must fully understand is the date(s) they received a PRF distribution, as this determines when they must use those funds by and then report on those funds.
With respect to the new time periods, HHS clarified in July that if a recipient has more COVID expenses and/or lost revenues than PRF in a time period, those lost revenues or expenses may be used in other PRF reporting periods.
2. Review welcome clarifications on lost revenues
Over the past year, HHS released multiple changes related to how PRF recipients may calculate lost revenues. There are currently three options from which providers may choose. However, one outstanding issue had been whether or not “other assistance received,” an additional PRF reporting element, would be somehow incorporated in that calculation. On July 11, HHS finally confirmed that “other assistance received reported to HRSA will not be used in the calculation of expenses or lost revenues.” (See HHS PRF Frequently Asked Questions guidance) This issue had been of significant relevance to organizations with other COVID-19 assistance, such as a Paycheck Protection Program loan.
Additional welcome news from HHS was that the lost revenue calculation will be determined on a quarter by quarter, stand-alone basis. Therefore, for each of the six required quarters, only quarters with losses will be added together to determine an entity’s total lost revenue for a reporting period. Quarters with gains are disregarded.
3. Understand whether single audit applies to you
Many PRF recipients have wondered how and when single audit will apply. In July, HHS released two FAQs in providing some clarity related to an entity’s Schedule of Expenditures of Federal Awards (SEFA). HHS directs entities to watch the Office of Management & Budget Office of Federal Financial Management for the 2021 Compliance Supplement for details, but indicates SEFAs are required when entities expend $750,000 or more in federal awards in a fiscal year. This applies to both for-profit and nonprofit entities. HHS clarified that the amount to include on SEFAs will tie to an entity’s PRF reporting submission based on the following:
- For a FYE of June 30, 2021, and through FYEs of December 30, 2021, recipients are to report on the SEFA the total expenditures and/or lost revenues from the Period 1 report submission to the PRF Reporting Portal.
- For a FYE of December 31, 2021, and through FYEs of June 29, 2022, recipients are to report on the SEFA the total expenditures and/or lost revenues from both the Period 1 and Period 2 report submissions to the PRF Reporting Portal.
- For FYEs on or after June 30, 2022, SEFA reporting guidance related to Period 3 and Period 4 will be provided at a later date.
4. Assess implications and next steps
PRF has been a moving target over the past 18 months. Now that the reporting portal is open and with the details released by HHS in June and July, it is important to have a good understanding of these new requirements.
What are your immediate next steps?
- Know the exact date you received a PRF distribution, as it dictates your time period(s) for use and reporting.
- Review those dates. Depending on how many PRF distributions received, you may have to report in 1, 2, 3, or even 4 reporting periods.
- Gather all the data that needs to be reported to HHS. This could be extensive.
- Register on the portal if you received PRF payments between April 10 – June 30, 2020. If so, you are currently in reporting Period 1. You have until Sept. 30, 2021, to complete your reporting.
- Reach out to your CLA advisor. If you don’t have one yet, we can help.
How we can help
If you need assistance with understanding your PRF distributions, considerations for lost revenues, or expenses and single audit impact, reach out today. We are here to know you and help you.