What is Phase 3 General Distribution funding?

On October 1, 2020 HHS announced $20 billion in new funding for providers on the frontlines of the coronavirus pandemic under a Phase 3 General Distribution allocation. HHS recognizes that this pandemic cannot be won without frontline healthcare providers focused on containing the virus and delivering holistic care. Unlike prior distributions, providers will have to apply for these additional funds and include supporting financial data.

All eligible providers will be considered for payment against the following criteria:

  • Applicants that have not yet received Relief Fund payments of 2% of patient care revenue from prior general distributions will receive additional payment for the difference
  • With the remaining balance of the $20B budget, HRSA will calculate an equitable add-on payment that considers the following:
    • Provider’s charge in operating revenues from patient care
    • Provider’s charge in operating expenses from patient care (including expenses incurred related to coronavirus)
    • Payments already received through Prior Relief Fund distributions

Providers that have already received Provider Relief Fund payments worth 2% of their annual revenue may be eligible for an add-on payment to cover financial losses and changes in operating expenses caused by the coronavirus. Providers that began practicing in 2020 and Behavioral Health providers that were previously ineligible for prior funding relief will also be able to apply. 

Providers will have from October 5, 2020 through November 6, 2020 to apply for the Phase 3 General Distribution funding and providers are encouraged to apply early to expedite the review process, payment calculations, and ultimately accelerate the distribution of payments. 

Similarly to prior distributions, all payment recipients will be required to attest to receiving the Phase 3 General Distribution and accept the associated Terms and Conditions. Providers that receive payments in excess of $10,000 will need to submit post-payment reports under HHS’ newest reporting guidance via a portal that is expected to open January 15, 2021, with the initial report due by February 15, 2021.

More information on the Phase 3 General Distribution can be found here.