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HHS distributes Provider Relief Funds to safety net hospitals

DATE: 06/18/2020

On June 9, the U.S. Department of Health and Human Services announced plans to distribute $10 billion in CARES Act Provider Relief Funds to certain safety net hospitals that serve a disproportionate number of Medicaid patients or provide large amounts of uncompensated care. According to the HHS announcement, hospitals qualifying for this funding pool will have:

  • a Medicare Disproportionate Payment Percentage of 20.2% or greater;
  • average uncompensated care of $25,000 or more per bed — for example, a hospital with 100 beds would need to provide $2,500,000 in uncompensated care in a year to meet this requirement; and
  • a profit margin of 3% or less (based on 2018 cost report).

The distribution amount for an eligible safety net hospital is the proportion of the individual facility score (number of facility beds multiplied by the Medicare Disproportionate Payment Percentage) to the cumulative facility scores for all safety net hospitals, times the $10 billion safety net distribution.

Recipients will receive a minimum distribution of $5 million and a maximum distribution of $50 million.

DataGen analyzed which safety net providers may receive the funding and each hospital’s estimated funding.