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Revised November 11, 2020 (changes in red)

HHS has been clarifying and changing the acceptable uses of HHS Cash and the related reporting requirements.   HHS issued its most recent version of these rules, in its Post-Payment Notice of Reporting Requirements (“Notice”), dated October 22 November 2, 2020.  Stress alert!  The HHS Provider Relief Fund Program is becoming more “grant-like”.  You now need to report that you used HHS Cash for one of two acceptable uses.  Additionally, the new reporting requirements are more demanding than originally discussed when HHS offered cash to dental practices this summer.  Your accounting team will spend significantly more time on the new requirements than practices and consultants had anticipated.  Additionally, some of the requirements are still subject to interpretation, and HHS does not have forms or examples available yet.  This sounds like PPP loans back in April 2020!

Below are the key points of the Notice applicable to moderate-sized dental practices:

  1. The Notice applies to practices who will receive cumulatively more than $10,000 from HHS.  This will include cash your practice received from HHS (“HHS Cash”) prior to September 19.  Takeaway for practices who cumulatively receive less than $10,000 from HHS:  The good news is that you are not subject to the reporting requirements discussed below.  However, I have not seen that HHS has exempted any practice from an HHS audit.  I suggest you carefully read the attestation and other terms of any HHS documents you are asked to sign, to identify your commitments and exposure to future HHS audits.  Also, read item 4 below, to try to identify and record for future reference expenditures attributable to Covid19.

After learning of the staff time required to justify the use of HHS Cash for acceptable uses as I explain below, a few practices have asked me if they can return all but $10,000 to avoid this reporting.  The answer is yes!  HHS issued a FAQ answering this question dated 10/28/20, saying that a practice must report only when they have retained $10,000 or more..." If you want to use this strategy, I would return enough cash to HHS so that the amount your practice retains is $9,999 (ie, not $10,000).  Also, I would keep track the expenses caused by covid-19.  I am not aware that HHS has stated they won't audit your practice if you keep less than $10,000 of HHS cash.  (HHS has only promised you would not have to report to them on the use of HHS cash.)  Knowing the covid-19 cost will help you to separate cost increases from covid v. other cost increases that you might not identify if the covid-19 costs are commingled with the usual supplies and other costs.

  1. HHS plans to require you or your staff to submit the required data for 2019 and 2020, using its portal between January 15 through February 15, 2021

TakeawayIf you want to keep HHS Cash, you will not want to miss this deadline, which occurs soon after 2020 ends.  You should communicate with your accounting team now to confirm they know the HHS acceptable use rules, and the related reporting requirements described below.  Your accounting team should assess whether your accounting system is set up to provide you with patient revenue and operating expenses by quarter.  The team should also confirm that the accounting system will identify, record, summarize and store documents supporting Covid-19 expenditures reported, as explained in item 4 below.  Also, your accounting team should advise all staff who purchase and record vendor invoices, so they identify expenditures attributable to Covid-19. 

  1. The Notice explains that HHS will use the required data to determine if your practice has used the cash you received from HHS for one of two acceptable uses.  See items 4 and 5 below.
  1. The first acceptable use of HHS Cash is when your practice pays for unreimbursed expenditures attributable to Coronavirus (“Covid-19”) during 2020.  Your practice needs to exclude those expenditures for which it already received reimbursement for covid-19 reasons from PPP, other programs, or even insurance companies or patients.  The expenditures can include health-care related expenses, or administrative expenses (ex: professional fees paid to assist with Covid-19 matters.)

Starting on page 1, item 1, the Notice explains HHS’s interpretation of “Expenses Attributable to Coronavirus”.  That section of the Notice also explains that your accounting team will need to separately report totals of the expenditures attributable to Coronavirus into two categories:

  • Administrative expenses
  • Other healthcare related expenses.

Pages 3 and 4 of the Notice provides examples of Administrative Expenses, and Healthcare expenses.  Remember, do not count expenses for which your practice already received reimbursement.  This section also explains additional reporting requirements is your practice cumulatively receives $500,000 or more from HHS.


  • If you expect your Practice’s 2020 collections of revenue for patient services (net of refunds) will be close to your practice’s 2019 amount, it is imperative for your practice to identify, record, and report that you used HHS cash to pay unreimbursed Covid-19 related expenditures.  This is because you will not be able to justify the acceptable use of HHS Cash to supplement Lost Revenues, as explained in item 5 below.
  • Your staff will spend significantly more time to document your practice’s use of HHS Cash for unreimbursed expenditures related to Covid-19 than previously anticipated. 

You should communicate with your accounting team to confirm they are familiar with the new HHS acceptable use of HHS Cash and the related reporting requirements. Your accounting team should confirm that your accounting system will accumulate the unreimbursed expenses attributed to Covid-19.Your accounting team should advise all staff who purchase or record vendor invoices to identify and record expenditures attributable to Covid-19.Your accounting team should consider filing an extra copy of the invoice in an HHS Covid19 Expenditures folder stored on computer via scanning, or in a paper folder.  Keep that folder for 3 years from the date you submit your final HHS report in 2021, in case HHS audits your practice. Remember, the motivation for doing this is so your practice can keep the cash it received from HHS.

  1. The second acceptable use of HHS Cash is to supplement your practice’s “Lost Revenues Attributable to Coronavirus” (“Lost Revenues”).  In its October 22 Notice, HHS changed the rules to define Lost Revenues.  Lost revenues is now defined as the decrease in your practice’s annual revenues from patient services collected during 2020 vs 2019, minus the amount you already justified as an acceptable use of HHS Cash from expenditures attributed to Coronavirus (item 4).  Note:  HHS issued an FAQ dated 10/28/20 which states that "assistance received [such as PPP monies, insurance or patient reimbursements for covid charges, etc.] is reported as [2020] operating revenue, and is used in the calculation of year-over-year change in patient care related revenue."

Our interpretation:  Say your practice receives $100,000 from HHS.  Your practice identifies and reports that it spent $40,000 on unreimbursed expenditures attributed to Coronavirus during 2020.  Therefore, your practice can justify the acceptable use of HHS Cash of up to $60,000 under Lost Revenues definition of acceptable use.  If your practice’s final decrease in revenues from patient services collected during 2020 v. 2019 is $40,000, you can justify $40,000 under the Lost Revenues acceptable use - and consider reporting into 2021, see item 6 below.  If your practice’s final decrease in revenues from patient services collected during 2020 v. 2019 is $90,000, HHS will cap your acceptable use of HHS Cash from Lost Revenues at $60,000.

  1. If you have not justified the use of HHS Cash for acceptable use as explained in items 4 and 5 above by December 31, 2020, you still have one more chance to show you used HHS Cash for an acceptable use.  On the top of page 2 of the Notice, HHS states, “If recipients do not expend PRF funds [for acceptable uses] in full by the end of calendar year 2020, they will have an additional six months in which to use remaining amounts toward expenses attributable to coronavirus but not reimbursed by other sources, or to apply toward lost revenues in an amount not to exceed the difference between 2019 and 2021 actual revenue.  For example, the reporting period January – June 2021 will be compared to the same period in 2019, or January  - March 2021 will be compared to the same quarter in 2019."  If you rely on this 2021 extension, your practice will need to report to HHS again by July 31, 2021.
  1. We think you will have to repay any HHS Cash that your practice does not report as used for acceptable uses as explained in items 4 through 6 above.
  1. Although your practice will compare its 2020 and 2019 annual revenues collected to determine whether you can justify the acceptable use of HHS cash to supplement Lost Revenues, it appears that your accounting team will need to report 2020 v. 2019 financial data quarterly.  Also, even though HHS no longer uses expenses in its formula of Lost revenue as it did in its September 19 notice, HHS still seems to be asking for expense information.  Presumably, HHS is accumulating this data for statistics.
  1. Under the Lost Revenue Acceptable use explained in item 5, your practice must provide Revenue from Patient Care Payer Mix for 2020 and 2019.  This requirement is discussed on page 4 of the Notice.
  • This requirement may be difficult for some Fee-for-service practices to assemble.  Also, I have emailed HHS to advise whether you must separate collections from Fee-for-service patients using balance billing between Commercial and Self-pay - or if you can consider fee-for-service patients to be Self-pay for purposes of reporting to HHS.  You should confirm that your dental or accounting software can accumulate the necessary data.
  1. You must report the assistance you received from PPP and other programs.
  1. If the above requirements aren’t enough, your practice must provide nonfinancial data to HHS:
  1. Personnel metrics: Total personnel by labor category – statistics on labor changes for full-time, part-time, subcontract, and other categories.
  1. Patient Metric: Total number of patient visits (in person or via telehealth).
  1. There are other items discussed in the Notice that will not apply to many practices.  This includes additional reporting requirements if you receive $500,000 or more from HHS; and still more reporting requirements if you receive $750,000 or more from HHS in any one year.  You should access the Notice here to see those requirements.  Also, the Notice discusses requirements if you have a change in ownership.


HHS has changed the reporting requirements significantly from what was known, if your practice received HHS Cash prior to September 19.  Fortunately, HHS’ October 22 Notice made it a little easier for you to determine whether keeping HHS Cash you already received, or applying for more cash, is worth the cost of staff time and stress of the relatively new requirements to justify the use of cash your practice received from HHS.  Also, remember the cost of losing some of the cash you receive from HHS when you file your income tax return, as HHS Cash is taxable to your practice.  If you are still motivated to keep cash you received from HHS, you should discuss HHS’s revised reporting requirements with your accounting team now, to ensure that they will identify, record, summarize, report and store the required data and documents.  The motivation for doing this is so you can keep the cash you received from HHS.

Raising the White Flag

If you previously received cash from HHS, but you now decide you do not want to deal with the new reporting requirements, consider returning all but $9,999.  See item 1 above for details.  Or, you can reject all the cash within 90 days of first receiving HHS Cash.  For details on how to reject and return the cash, see HHS’ Provider Relief Fund General FAQs.

More HHS Cash Available, but Weigh the Benefit and Costs…

HHS recently announced that almost all practices can apply for more cash through November 6 under its Phase 3 General Distribution – even those that received cash from HHS already.  See my article linked here for more information about Phase 3 distributions.  Before you apply under Phase 3, you should compare the benefit of receiving more cash from HHS, to the additional staff costs and stress to justify the use of the new HHS Cash for the two acceptable uses (items 4,5 and 6 above); and to meet the other reporting requirements listed above.  The answer will depend on the amount your practice spends for unreimbursed expenditures attributable to Covid-19 during 2020 (item 4); and on how close you think your practice’s 2020 revenues will compare to 2019 (item 5).  Also, consider that you can continue to justify the acceptable use of HHS Cash for January to June 2021 v. 2019, if needed (item 6). 

HHS is still developing the requirements of its Provider Relief Fund.  HHS continues to clarify and change the requirements often in response to comments from Congress and Stakeholders.  Therefore, you should not rely on the contents of this article until you confirm the contents are still valid.  Consider seeking the guidance of professional counsel to confirm the accuracy of this article.  Please call Jim Blowers at 518-344-6087, or email me at, if you have questions.