Reed Smith Client Alerts

This Client Alert provides a summary of the general and targeted CARES Act funding allocations to health care providers, as well as an overview of the Terms and Conditions to which these funds are subject. And after parsing the Terms and Conditions, this Client Alert also describes the associated fraud and abuse ramifications that may follow under these circumstances and sets forth our “Top 5” practical tips for navigating the evolving CARES Act regulatory environment.

Authors: Lesley C. Reynolds James F. Segroves

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On March 27, 2020, President Trump signed into law the Coronavirus Aid, Relief, and Economic Security (CARES) Act providing $100 billion in relief funds to hospitals and other healthcare providers on the front lines of the coronavirus response.1 As detailed in our prior client alert, this funding will be used to support healthcare-related expenses or lost revenue attributable to COVID-19 and to ensure that uninsured Americans can get testing and treatment for COVID-19.

On April 10, the Health Resources Service Administration, an agency of the U.S. Department of Health and Human Services (HHS), began distributing $30 billion in general provider relief from the Public Health and Social Services Emergency Fund (known as the Provider Relief Fund) that was appropriated in the CARES Act. On April 22, HHS announced the release of the then-remaining $70 billion of the $100 billion in provider relief – these residual funds include an additional $20 billion in general provider relief funding, as well as more targeted allocations focused on providers in COVID-19 high-impact areas, providers who provide COVID-19-related treatment to the uninsured, rural health clinics and hospitals, and Indian Health Service facilities, among others.

This Client Alert provides a summary of the general and targeted funding allocations as well as an overview of the Terms and Conditions to which these funds are subject. And after parsing the Terms and Conditions, this Client Alert also describes the associated fraud and abuse ramifications that may follow under these circumstances and sets forth our “Top 5” practical tips for navigating the evolving CARES Act regulatory environment.