More on Policy and Legislation

HHS announces $2 billion provider relief fund nursing home incentive payment plans

The distribution is the latest update in the previously announced $5 billion in support to nursing homes wrestling with COVID-19.

Jeff Lagasse, Associate Editor

On Thursday, the U.S. Department of Health and Human Services, through the Health Resources and Services Administration, announced the details of a $2 billion Provider Relief Fund performance-based incentive payment distribution to nursing homes. 

This distribution is the latest update in the previously announced $5 billion in planned support to nursing homes grappling with the impact of COVID-19. Last week, HHS announced it had delivered an additional $2.5 billion in payments to nursing homes to help with upfront COVID-19-related expenses for testing, staffing, and personal protective equipment needs. 

Other resources are also being dedicated to support training, mentorship and safety improvements in nursing homes.

Nursing homes, which have been hit especially hard during the pandemic, will not have to apply to receive a share of the $2 billion incentive payment allocation. HHS will be measuring nursing home performance through required nursing home data submissions and distributing payments based on the data.


In order to qualify for payments under the incentive program, a facility must have an active state certification as a nursing home or skilled nursing facility and receive reimbursement from the Centers for Medicare and Medicaid Services. 

HHS will administer quality checks on nursing home certification status through the Provider Enrollment, Chain and Ownership System to identify and remove facilities that have a terminated, expired or revoked certification or enrollment. 

Facilities must also report to at least one of three data sources that will be used to establish eligibility and collect necessary provider data to inform payment: Certification and Survey Provider Enhanced Reports, Nursing Home Compare and Provider of Services.

The incentive payment program is scheduled to be divided into four performance periods (September, October, November and December), lasting a month each, with $500 million available to nursing homes in each period. All nursing homes or skilled nursing facilities meeting the qualifications will be eligible for each of the four performance periods. 

Nursing homes will be assessed based on a full month's worth of the aforementioned data submissions, which will then undergo additional HHS scrutiny and auditing before payments are issued the following month, after the prior month's performance period.


Using data from the Centers for Disease Control and Prevention, HHS will measure nursing homes against a baseline level of infection in the community in which a given facility is located. CDC's Community Profile Reports include county-level information on total confirmed and/or suspected COVID-19 infections per capita, as well as information on COVID-19 test positivity. Against this baseline, facilities will have their performance measured on two outcomes: the ability to keep new COVID-19 infection rates low among residents, and the ability to keep coronavirus mortality low among residents.

To measure facility COVID-19 infection and mortality rates, the incentive program will utilize data from the National Healthcare Safety Network LTCF COVID-19 module. CMS issued guidance in early May requiring that certified nursing facilities submit data to the NHSN COVID-19 Module.  Data from this module will be used to assess nursing home performance and determine incentive payments.

Funding for this nursing home incentive effort was made possible from the $175 billion Provider Relief program funded through the bipartisan CARES Act and the Paycheck Protection Program and Health Care Enhancement Act. Incentive payments will be subject to the same terms and conditions applicable to the initial infection control payments announced last week (available here).


Last week, CMS required nursing homes to test staff for COVID-19. Nursing homes that fail to meet staff testing requirements risk suspended participation in the Medicare and Medicaid programs. They will be cited for noncompliance and may face enforcement sanctions based on the severity of the noncompliance, such as civil money penalties in excess of $400 per day, or more than $8,000 for an instance of noncompliance.

The Trump Administration is helping facilities offset the cost of testing through $2.5 billion in funding, on top of $5 billion already authorized from the Provider Relief Fund of the Coronavirus Aid, Relief, and Economic Security Act.


"The Trump Administration has focused resources throughout our response on protecting the most vulnerable, including older Americans in nursing homes," said HHS Secretary Alex Azar. "By tying these new funds for nursing homes to outcomes, while providing the support they need to improve quality and infection control, we will help support quality care, slow the spread of the virus, and save lives."

Twitter: @JELagasse
Email the writer: