In late 2019, North Shore Healthcare bought 22 senior housing and care facilities that had been in receivership.
Almost a year later, the timing of the deal has meant North Shore still hasn’t received the initial round of CARES Act relief funds from the federal government — during a pandemic that’s thrown aging care providers into a serious headwind.
It’s one of many situations where aging care providers are managing multiple funding streams with government agencies playing constant catchup — and with changing requirements — to help providers.
The federal government eventually opened up an application process for providers in these situations; North Shore just recently submitted its information and is waiting to receive those funds — funds that went to other providers in April and May, according to North Shore Healthcare vice president of finance Gail Holland.
“We brought this to the attention of the government to say, ‘You’ve left out a lot of providers, and we’re in a dire need,’ like anyone else, so they had attempted to remedy that situation,” Holland said.
With so many funding streams — blanket outlays for Medicare and Medicaid providers, targeted SNF distributions, a four-month incentive-based payment program, and the Paycheck Protection Program, among others — skilled nursing facilities and other long-term care providers are in a long-term scramble to track ever-moving requirements.
And those requirements are important to track: that is where the rubber will hit the road when the pandemic ends, and federal and state agencies audit and attempt to claw back misused funds.
Take the Provider Relief Fund. On Sept. 19, the Department of Health and Human Services issued the first set of reporting requirements. But then, on Oct. 22, and again on Nov. 2, HHS modified their guidance.
Professional services firm CliftonLarsonAllen (CLA) director Jennifer Boese said that’s on top of 61 modified or new PRF FAQs added in late October. Facilities are struggling with how to calculate lost revenue, determine acceptable ways to use the funds, and define revenue recognition.
“There are areas of confusion, especially since the federal government is pushing out hundreds of billions of dollars in a relatively short amount of time,” Boese wrote in an e-mail. “It is difficult for operators who are still in the midst of the pandemic serving their patients, staff, and communities to try to keep up with the constantly evolving regulatory changes.”
For multi-state providers, like Health Dimensions Group, added to this wave are all the different ways states are doling out CARES Act funds and adjusting their Medicaid reimbursements. Amber Rogotzke, president of the Minneapolis-based consulting firm and senior care operator, said some states are providing an across-the-board rate increase, while others are reimbursing by expense, or giving out funds based on need.
“And some still have not even presented a plan focusing on senior care,” Rogotzke wrote in an e-mail. “The overlap between programs has also been a challenge as each funding program wants to be last in line, which means that you have to figure everything else out first with complete clarity before you can access certain other programs.”
Holland at North Shore Healthcare said she’s keeping track of funding streams on a spreadsheet, while an outside accounting firm to keep tabs on all the moving parts. She’s also regularly analyzing their financial data, which recently turned out to be a life saver: At the start of the pandemic, the Department of Health and Human Services (HHS) calculated the amount of funds sent to providers based on actual budget. But then HHS changed course and started releasing funds based on historical budget data.
“I had already been looking at our data from different perspectives, so it didn’t catch me unaware,” Gail said, adding that she considers analyzing data in every way a best practice. “It will help you truly understand [the data], and if a new regulation comes out, you won’t be caught off guard.”
North Shore is also holding weekly calls, including staffers from finance and revenue-cycle management to operations and clinical teams. Part of the calls are also to discuss long-term strategy. Holland doesn’t anticipate the added expenses related to new infection control protocols and other coronavirus-specific practices to go away even after there is a vaccine, in part because she anticipates some of these new measures will become business as usual.
“If they intend to keep those new procedures, then that additional cost won’t go away,” Holland said. “And as with the flu vaccine, there are always different strains of the virus. I believe that there is going to be some continued extra cost on an ongoing basis.”
And while there are costs from caring for patients in the coronavirus pandemic, there is also lost revenue from lower occupancy, either because families chose to not admit loved ones, or facilities freeze new admissions.
“The more long-term issue will be when the provider relief money runs out, and whether occupancy has rebounded,” Rogotzke with HDG said. “Providers will need a strong occupancy recovery plan moving forward and, in some cases, will need to develop a rightsizing strategy.”