U.S. to Send Health Providers $20 Billion More in Virus Support

(Bloomberg) --

The U.S. government plans to distribute another $20 billion to health providers whose businesses have been hurt by the Covid-19 pandemic, adding to $30 billion that was already distributed.

The money is part of the $100 billion set aside for hospitals, physician practices and other health-care providers in the CARES Act, the $2 trillion stimulus package meant to help people, businesses and organizations hurt by the virus.

While some hospitals and health practices have been inundated with Covid-19 patients, many are struggling financially after canceling elective procedures and office visits that are major money-makers for the systems.

“We’re putting out all of these funds as quickly as possible,” Health and Human Services Secretary Alex Azar said on a call with reporters.

The initial $30 billion was distributed based on providers’ Medicare fee-for-service revenue, a simple calculation that let the government send the money quickly. But some hospitals said it resulted in hospitals that need the amoney most getting shortchanged in the initial round.

Azar said the next $20 billion round of relief will make up for that, and the total $50 billion allocation will be allocated based on providers’ overall revenue. The department also announced targeted relief funding for rural and tribal health providers, as well as hospitals in Covid-19 hotspots.

The Trump administration has given the green light to hospitals in areas without significant coronavirus cases to resume elective procedures, part of guidance intended to help lift restrictions on business operations that are part of social-distancing measures.

Congress is working on another relief bill expected to include an additional $75 billion for health-care providers.

©2020 Bloomberg L.P.