Assisted living providers are concerned about their ability to retain federal relief funds due to changes in reporting requirements, and industry associations are urging the Department of Health and Human Services (HHS) to address the situation.
Argentum and the American Seniors Housing Association on Monday sent a joint letter to HHS Secretary Alex Azar regarding the issue.
“The senior living industry operators [that] started to receive much needed funding from HHS’s Provider Relief Fund (PRF) are now deeply concerned that the New Reporting Requirements have created widespread confusion and unexpected potential barriers to retaining the funding received,” the letter states.
Specifically, HHS has issued new guidance that changes how “lost revenue” is defined, which will have an effect on how much Provider Relief Fund money an assisted living provider can tap. These funds were first made available to assisted living providers in September.
In previous guidance from HHS, lost revenue was defined as “any revenue that you as a health care provider lost due to coronavirus,” and providers were allowed to “use any reasonable method of estimating the revenue.” More recent guidance, issued in September, defines lost revenue as the year over year negative change in net patient care operating income, ASHA and Argentum state in their letter.
This new guidance would limit the relief available assisted living providers, the associations argued.
For example, the new guidance would penalize organizations that opened new communities or otherwise expanded in 2019, and have not been able to reach expected occupancy levels in 2020. The new guidance also does not take into account changes that providers made to decrease operating expenses during the pandemic, such as reducing or eliminating contributions to employee retirement plans.
“Based on informal membership feedback, most believe they will be adversely affected in a significant way by the abrupt change in the definition of lost revenue included in the New Report Guidance,” the letter from ASHA and Argentum noted.
The groups request that HHS revert to the older guidance.
The associations are also seeking clarification on other aspects of the guidance, including items related to the time frame to be used for calculating certain expenses, and what would qualify under general and administrative expenses.