Demystifying the Single Requirement for Provider Relief Funds ©2020 CliftonLarsonAllen LLP August 4, 2020

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The user also is cautioned that opinion advice oraccounting, construed,legal,tax be as or not should intended, not and is natureinformation and The containedgeneral in herein is Disclaimers Create Opportunities tax and other tax and 2 ©2020 CliftonLarsonAllen LLP • • • • Welcome lives abit easier your make help be may we how and informational, are that insights and tips with you provide know, do we what understanding in you assist to is goal Our now right youAs experiencingall are there manyare unknowns we are all dealing with employees andthe communities you all live andwork in you are making! What allof you do is helpingyour patients, residents, families, impact the and work your for you thank industry, care health the in those To us joining for you of all to you Thank Create Opportunities 3 ©2020 CliftonLarsonAllen LLP Objectives • • • • • Provider Relief Fund Single Provider Single Audit Considerations Fund Relief Questions Questions Latest Single Audit and Program Audit Requirements and Reporting Options Audit Create Opportunities terms, conditions, FAQs from from FAQs conditions, on terms, updates HHS 4 ©2020 CliftonLarsonAllen LLP • • COVID Specific Programs impacting healthcare(not comprehensive) Many COVID – – – – – – Create Opportunities Rural Health Clinic Testing (HHS) COVID Disorders SubstanceEmergencyAddressMentalDuring Use and Grants to (HHA) Program Center Health the Under Services Expanded and New for Grants – (HHS) Treatment and Testing COVID Uninsured 59.008 AssistanceDisaster (Economic Loans CFDA Loans, Disaster Injury SBA) (HHS) Fund Relief Provider - 19 Funding19 SingleAudit Requirements - – 19 (HHS) CFDSA 93.665 CFDSA 19 (HHS) CFDA 93.527 CFDA - 19 Programs will 19 be subject to Single Audit – CFDA 93.498 CFDA – CFDA 93.697 CFDA CFDA 93.461 CFDA 5 ©2020 CliftonLarsonAllen LLP COVID • • Funding Not Subject to Single Single to Subject Not Funding AICPA Government Audit Quality Center Create Opportunities – – – Summary of UG Applicability for New COVID New for Applicability UG of Summary Program Payment Advanced and Accelerated Medicare Loans Program Protection Payroll - s/singleaudit/uniformguidanceforfederalrewards.html#COVID www.aicpa.org/interestareas/governmentalauditquality/resource 19 Funding19 SingleAudit Requirements - 19 Federal Programs Federal 19 6 ©2020 CliftonLarsonAllen LLP • • • • What is a Single Audit? Single a is What Subject to three layers of audit requirements requirements of audit layers to three Subject program major each on effect material and direct a have that awards of federal conditions and terms with of compliance Testing controlsinternaltesting of perform and understanding an Obtain Audit of financial statements – – – Create Opportunities General Accepted Government Audit Standards (GAGAS) (GAGAS) Standards Audit Government Accepted General (GAAS) Standards Audit Accepted Generally Uniform Guidance Uniform – Yellow Book 7 ©2020 CliftonLarsonAllen LLP What is a GAGAS (Yellow Book) Audit? Book) is a What (Yellow GAGAS • • • • • • In accordance with Government Auditing Standards with Government accordance Auditing In Includes additional required communication for education auditors continuing specific Requires Additionalrequirements independence with laws of regulationsand compliance Testing reporting over financial controls of internal Consideration Create Opportunities – – Significant Deficiencies Significant Weaknesses Material 8 ©2020 CliftonLarsonAllen LLP Objectivesof a Single Audit • Create Opportunities programs materialand compliance requirements eachof major complied determine direct with entity the has Toif – – – – Used to find and address problems withproblems grantees addressand toUsed find compliance over controls on reports Auditor compliance regarding opinion provides Auditor compliance program to review agencies federal by Used 9 ©2020 CliftonLarsonAllen LLP Compliance Areas activities and and activities Allowable Allowable Matching Create Opportunities costs Program Program income Level of effortLevel of Indirect costs Indirect Reporting management Earmarking Cash Subrecipient Subrecipient monitoring performance Period of of Period Eligibility and provisionsand Special tests tests Special Procurement Equipment property and realand 10 ©2020 CliftonLarsonAllen LLP Schedule of Expenditure of Federal Awards • • • • Create Opportunities Subtotals number CFDA the and program Federal for individual expended awards each Total Federal List statements financial to theSupplemental individual Federal programs agency by programs Federal Federal individual by various U.S. Department, CFDA, CFDA, variousClusterDepartment, U.S. by 11 ©2020 CliftonLarsonAllen LLP When isa SingleAudit Required? • A non A Cost Principles, and Audit Requirements CostAudit Principles, and Requirements, Uniform Administrative (OMB) the Office accordance ofandwith Managementin audit excess of $750,000 in their fiscal year is subject to an Create Opportunities – Cost Principles and Audit Requirements of Federal Awards of Requirements Audit and PrinciplesCost Requirements, Administrative Uniform 200, Part CFR 2 - federal entity that expends federal awards in expendsin federalfederal that awards entity 12 ©2020 CliftonLarsonAllen LLP When isa SingleAudit Required? • • • Non For and(COVID non- year fiscal single Expend Create Opportunities – – – State or local government or local State education Higher Not - profit profit - federal entities - for federal awardsexcessin $750,000 ofa in - profit – P rogram audit rather than a single than rather rogram audit aaudit single COVID related) – includes total of all federal awards awards federal all of total includes 13 ©2020 CliftonLarsonAllen LLP SingleAudit Reporting • • • annually if expenditures exceed annuallycontinue $750,000 expenditures if required situations audit single is the most In issuance of single audit guidance for COVID COVID funding for guidance audit single of issuance in delays Global tovery extensions due are possible auditee’s year end the after months 9 or report auditors’ the of receipt after days 30 of earlier the within Clearinghouse Audit Federal the to due is Form Collection Data A Create Opportunities 14 ©2020 CliftonLarsonAllen LLP SingleAudit Reporting • Single Single Audit reporting package includes: Create Opportunities – – – – – – – Corrective action plan if findings actionCorrective findings were plan if identified audit findings prior of schedule Summary costs questioned and findings of Schedule compliance control and internal over oncompliance Report reporting financial over control internal on Report (SEFA) awards federalof of expendituresSchedule statementsfinancial Audited – GAGAS 15 ©2020 CliftonLarsonAllen LLP • • • Provider Guidance provided in FAQ in provided Guidance potential recoupment Non Subject to terms and conditions Create Opportunities • - www.hhs.gov/sites/default/files/provider relief that are attributable to coronavirus.” coronavirus.” to attributable are that revenues lost or related care health for only Recipient the reimburse shall and coronavirus, to respond and for, prepare prevent, to used be only will Payment the Term/Condition:Important compliance are groundsare for -compliance - fund- Relief general - distribution Funds “The “The Recipient certifies that that certifies Recipient - faqs.pdf faqs.pdf 16 ©2020 CliftonLarsonAllen LLP • • • Provider 1, 2020. 2020. 1, HHS coronavirus. to respond dollars as health Eligible may include: to coronavirus’ attributable expenses related PRF use ‘healthcare for to COVID or respond for prepare prevent, to used be to are PRF funds – – – – – – – Create Opportunities healthcare services to to non services healthcare technology to expand or preserve care delivery care preserve or expand to technology and staffing, practices, healthcare supplies, equipment, facilities, including resources, additional acquiring for COVID capacity to expand structures temporary or constructing building reporting COVID centers; operation emergency and staffing developing training; workforce COVID or actual possible for services healthcare to used provide equipment supplies treated; and treated; long as as long used to provide healthcare services for possible or actual COVID or actual for possible services healthcare to provide used care to care coronavirus attributable expenses related Relief to coronavirus and and expenses were attributable coronavirus to - 19 test results to federal, state, or local governments; local or state, federal, to results test 19 - COVID Funds highly unusual unusual highly be would it indicates - 19 patients in a separate area from where COVID where from area separate a in patients 19 Refer to statute, terms/conditions, HHS PRF FAQs PRF HHS terms/conditions, to statute, ---Refer . may occur prior to receiving PRF PRF receiving to prior occur may used used expenses would be prior to Jan. Jan. to priorbe would expenses - 19 patients; 19 to prevent, prepare for, and to prepare prevent, - - 19 patient care or to provide provide to or care patient 19 19 patients; 19 - - 19 patients are being being are patients 19 19 17 ©2020 CliftonLarsonAllen LLP Expenses that PRF can be used for are not limited to providing care to presumptive or actual coronavirusactual or presumptive care to providingto limited not arefor used be can PRF that Expenses • • • • patients, but lost must be have been lost due to coronavirus. All uses must All must uses have but to be revenue to be must due lost prepare, lost coronavirus.patients, been Provider DHHS expected to issue and FAQ on calculation of lost revenue of lost on calculation FAQ and issue to expected DHHS etc. mortgage benefits, payroll, such as employee uses, acceptable of those examples five listed HHS date, To coronavirus. responds or for prepares prevents, cost that as long so covered have would otherwise revenue the lost that for any cost used PRF be may lost revenues: of quantifying examples several provides HHS revenues” to “lost related following the provides HHS Generally, – – – – Create Opportunities Increased uncompensated care uncompensated Increased or services procedures elective Canceled visits outpatientFewer to last revenues to compare the period same year.the and It revenue. revenue your would budgeted also actual reasonable lost could be the be between revenue estimated difference - COVID had period same compared during to the and April of method revenue use You the may March2020 reasonable any estimating 19 not appeared. For example, if if not have taking Foryou prepared account ofa budget COVID example, without into appeared. impact the 19 present or HHSpresent FAQsto COVID. respond statute, Review terms/conditions, Relief Funds - 19, the 18 ©2020 CliftonLarsonAllen LLP • RecognizingExpenditures of Provider Relief • • • Create Opportunities Additional guidancerecognition on pending is organizationsfollowing GASB PRFawards mustbe recognized as non- revenue unless theorganization has chosen to reflectas non- As funds areexpended they can be recognized for operations expenditures have been made appliedor against lost revenue Proceeds of PRFshould be deferred until qualifying operating for revenue operating Funds 19 ©2020 CliftonLarsonAllen LLP • RecognizingExpenditures of Provider Relief • • Create Opportunities when they are incurred arethey when expenditures to PRF receipts as timely possible as to CLA recommends identifying and attributing qualifying have reimbursed been lossessources other(PPP) thatby reimburse usedbe payments toPRF expenses cannot or audit of the single theexpenditures timing impact will The approachto recognition of PRF qualifying Funds 20 ©2020 CliftonLarsonAllen LLP • Provider • • Create Opportunities expected later in 2020 in expectedlater Addendum addressing COVIDall related programs is than COVID related provide updates for existing and new programs other The expected 2020 is update August,annualwill in which OMB Compliance Supplement as updated annually auditguidance the requirementsSingle andfound in are Relief Fund SingleAuditGuidance 21 ©2020 CliftonLarsonAllen LLP Provider ReliefFunds SingleAudit Questions • audit? a program or audit a single require itWill funds. than federal $750k of more expended organizationMy Create Opportunities expenditures from one federal award a program audit is allowed. is audit a program award federal one from expenditures only financial If audit not has audit.and is it requiredsingle a a to receive is award required federal than one more receives that or audit a financial receive to required that is organization An 22 ©2020 CliftonLarsonAllen LLP Provider ReliefFunds SingleAudit Questions • • • to consider: factors are multiple There other? the over one to advantage an there audits, is of two types the between can organization choose my If Create Opportunities under Yellow Book Yellow under However, if asingleaudit is performed, the financial auditwill needto be the of part as performed procedures certain to due performed already is audit It might be considered more efficient haveto a single auditif afinancial program audit. program auditors’ report issued usual, as with separate a report for issuedthe and performed be to audit financial the allow would audit program A statements. financial the of users by the impacted be might This 23 ©2020 CliftonLarsonAllen LLP Provider ReliefFunds SingleAudit Questions • options? my beare available.Whatto expected is audit guidance single My organization’s financial audit will need to be issued before the Create Opportunities different times. times. different ataudits be can performed planning two these appropriatewith but Book,under Yellow financial audit the performing as this, such completion of the financial audit. There are steps some to allow audit reporting can package be issued subsequent to the single and a separate can performed proceduresbe audit single The 24 ©2020 CliftonLarsonAllen LLP Provider ReliefFunds SingleAudit Questions • required? entity will exceed the $750k expenditure threshold. Is an audit the consolidated audit.arequire single However, not $750k would so thanless eachthat received multiple entitieshas organizationMy Create Opportunities awards. has been brought to DHHS for clarification regarding COVID regarding clarification for DHHS to brought been has this question However, an organization. for level consolidated the at are evaluated expenditures is approach thatThe federal general - 19 25 ©2020 CliftonLarsonAllen LLP Provider ReliefFunds SingleAudit Questions • audit? single with a one along I toWill have need audit. financial for is organization My Create Opportunities 45 – – – CFR CFR Single audit (with audit) Yellow Bookfinancialstatement (no audit) If multiple awards received, an audit allawards of in accordance with awardgrant was receivedfinancial statement (no audit) of type one only if Book Yellow under award particular a of audit An § 75.216 provides options: provides 75.216 - profit and does not currently receive a a receive currently not does and profit 26 ©2020 CliftonLarsonAllen LLP does not want to perform audit the single to wantdoes not auditorbut my audit,receivesfinancial organization aMy Provider ReliefFunds SingleAudit Questions • Create Opportunities yellow book requirements. be to needs audit financial the as appropriately done financial audit the performs than audit single the perform can firm audit different A . Careful planning will need to be done to ensure this is is this ensure to done be to need will planning Careful . performed under under performed 27 ©2020 CliftonLarsonAllen LLP • Next Steps • • Create Opportunities surprises. loans. loans. auditoryour with or requirements audit potentialsingle Discuss COVID includes This expenditures. and related received awards all federal Identify reporting. financial accurate for necessary and is programs various the under requirements neither are required.This will information be needed for reporting or audit program audit, a single whether of regardless programs funding to any related records accurate to maintain is important It – contact them early to avoid early or to them avoid audit reporting single contact - 19 related as well as any other federal grants and and grants federal any other as well as 19 related 28 ©2020 CliftonLarsonAllen LLP organization we are here to help. help. to we here are organization your orto specific requirementson general questions have you If available. becomes it as CLA to continueinformationcontinuewill timely evolve. communicate We’re Here to Help!Here to We’re Single audit and reporting requirements for COVID for requirements audit Single andreporting Create Opportunities - 19 related awards awards related 19 29 ©2020 CliftonLarsonAllen LLP WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING AND TAX, AUDIT, | OUTSOURCING | ADVISORY WEALTH LatestUpdates,PRF FAQs Investment advisory services are offered through CliftonLarsonAllen Wealth Advisors, LLC, an SEC an LLC, Advisors, Wealth CliftonLarsonAllen through offered are services advisory Investment - registered investment advisor 30 ©2020 CliftonLarsonAllen LLP First $30 billion$30 First situations. situations. 10 Aug. applications Reopening to2% of 2018 netrevenues. up add to designed are 2) & 1 (Tranche distributions Combined HHS. cost report data on file with from on revenuesbased these providers/suppliers toAdditional billion$20 expected distribution. = $30 B FFS/$484 x B) Allocationformula: (2019 2019. in reimbursement FFS Medicare received providers/suppliers Fund Allocations To Date Date To Allocations Fund - 28 in two28 in General these two two these Create Opportunities – went to to went who who Each release August28, 2020 of deadline Application $15 care patient gross revenuesfrom 2% least at to equal distribution a for considered be to details revenue submit tohad Providers care organizations. including Medicaid/ in participate that to those of $15 billion release theannounced HHS 9, June On Medicaid/CHIP billion designated. designated. billion annual patient annual of reported reported of managed CHIP, Provider Relief Fund (Allocations August of as (Allocations Relief Fund Provider of funds requires attesting/certifying to a set of terms and conditions ninsuredclaim www.hrsa.gov/covidu details at at details diagnosis. Full primary COVID services witha and treatment COVID for testing qualifying will be made for Reimbursements after Feb. 4, 2020. on or admittance or service of dates reimbursements for based claims are These Uninsured - 19 and and 19 - 19 - (Aug 3, 3, (Aug • • • • • • Rural Distributions Rural released on July 10 to 500 other HealthCenters (CHC or FQHC)rural in areas receiveda distribution 10. MayonAnother $1 billionwas revenue. Apply by August 28 using the Enhanced Provider Portal Provider Enhanced bythe 28 using August Apply revenue. Dentists funds. these received total, 958 All hospital was 10, distributed. another $3 on July billion and Safety Net Hospitals($12.8B) programs, hospital High Impact($22B but non- IndianHealth Services ($500M) billion will be released,but eligible nursing homesmust complete a 23 beds. ($9.9B) Facilities Nursing Skilled and received $50,000/patient payments. care and share uncompensated disproportionate and Medicare Medicaid hospital’s account thoseinto COVID amount per for 100 COVID for 100 more or Each SNF received $50,000 $5 plus $50,000 22, additional an SNF announced per $2,500 On Each received HHS July bed. - . July 1 July . rural communities. submitted including Round 2 was released on July 17 to 969 hospitals that had 161 COVID patients by June 10 2 10 17 had to onRound July was 969 COVID byreleased patients that June161 hospitals 0, HHS announced dentists would be eligible for 2% 2% patient annual for their reported of be eligible would dentists 0, HHS announced 2020) - – 19 inpatient admission, with an additional amount ($2 B total) distributed by distributed total) B ($2 amount additional an with admission, inpatient 19 data, HHS awarded Round 1 on May 1 to 395 hospitals hospitals 395 to 1 on May 1 Round awarded HHS data, ($12B). IHS and Tribal hospitals Tribal and IHS Round 1, 2). 2). 1, Round - 19 patients through April 10. The distribution formula was was fixed on a based formula 10. The distribution April 19 through patients Rural . to certain hospitals $10 On the of billion release HHS Juneannouncing 9, . t On Services, Health 22, Indian May special rural Medicaredesignation hospitalsurban areas in and . On May 21, HHS released$4.9 billion to SNFs with at least 6 or more hospitals (CAHs, rural PPS),Rural HealthClinics (RHC), & Community Targeted at hospitals in areas heavily impacted by COVID. Using COVID. Using by impacted heavily in at areas Targeted hospitals Targeted 3 , 2020) , received funds received Distributions ribal, and health and Indian urban ribal, - module training program that care inpatient provided in small taking taking 31 ©2020 CliftonLarsonAllen LLP PRF Applications:PRF UpdatesRecent • • for the General Distribution (Tranche 2) 2) two situations:in (Tranche Distribution General thefor On July 31, HHS announced it would reannouncedit would On HHS 31, July 28 distributions untilAug. Medicaid/CHIP/Dental for application deadlinethe extendannouncedit would On HHS 31, July – – – Create Opportunities In In distribution 1 Tranche receive not did owner 2020 where 2020 to 2019 from ownership in change a with Providers #2: 2 Tranche for apply to failed but 1 Tranche received who Providers #1: applications will be accepted beginning Aug. 10- Aug. beginning accepted be will applications situations, both - open the application portal 28 32 ©2020 CliftonLarsonAllen LLP Terms/Conditions (excerpts) Terms/Conditions • Conditions Acceptance • revenues that are attributable to coronavirus.” coronavirus.” to attributable are that revenues lost or expenses related care health for only Recipient the reimburse shall and coronavirus, to respond and for, prepare prevent, to used be only will Payment the Term/Condition:Important applicable. with any other relevantand statutes regulations, as below. Termsand Conditions funds, you aredeemed tohave accepted the following withoutcontacting regarding HHS remittancethoseof 116- 127 and Law provider relief (“Relief under Fund”) Division B of Public Public Healthand Social Services Emergency for Fund If you receive a payment from funds appropriated in the Create Opportunities This This is not an exhaustiveand list you must comply retainthat payment at leastfor of Terms and and Termsof . Please also indicateyour acceptance “The “The Recipient certifies that that certifies Recipient 30 days 30 days HHS extended attestation extendeddeadline HHS to to 90 days from dateof receipt 33 ©2020 CliftonLarsonAllen LLP • • • • • (excerpts) Conditions? & Terms other information required by future program instructions to substantiate the reimbursement of of reimbursement the substantiate to instructions program future by required information other out For all all For of excess in a rate at mechanism, extramural other or a grant through individual, an of salary the pay to used be shall appropriated funds the of None “ “ 45 CFR sources other from reimbursed “ information. equivalent other or revenue, service program sales, or receipts gross Recipient’s the estimate to parties third Fund from Relief the may receive Recipient the care had been provided by an in an by provided been had care the Shall maintain appropriate records and cost documentation including, as applicable, documentation required by by required documentation applicable, as including, documentation cost and records appropriate maintain Shall Services and Human of Health to Department the consents Recipient The The recipient certifies that it will not use the Payment to reimburse expenses or losses that have been been have that losses or expenses reimburse to Payment the use not will it that certifies recipient The • ─ – – – - Create Opportunities of No balance billing No Federal pay level set at $197,300 for 2020 retention record and Documentation Public release of data double dipping No - care for a presumptive or actual case of of case actual or presumptive a for care pocket expenses in an amount greater than what the patient would have otherwise been required to pay if if pay to required been otherwise have would patient the what than greater amount an in expenses pocket § 75.302 – Financial management and management Financial or that other sources are obligated obligated are sourcesother that or - network network . The Recipient acknowledges that such disclosure may allow some allow may disclosure such that acknowledges Recipient The Executive Level II Level Executive Recipient. Recipient. 45 CFR COVID - § seek to collect from the patient patient 19…certifies from the that notto it will seek collect 75.361 through 75.365 through 75.361 . to reimburse to publicly disclosing the publicly disclosing the Payment – Record Retention and Access costs. costs. that , and and , 34 ©2020 CliftonLarsonAllen LLP What We KnowWe What • • Key money? of the PRF some recoupmay HHS that potential the Is there Q: Make sure you understand the terms/conditions applicable to the PRF funds you you received funds to PRF the applicable terms/conditions the you Make sure understand documented this have you that and COVID to back expenses” increased and revenue “lost your track you can sure Make Takeaway Create Opportunities and it is re is it and asonable/justifiable. asonable/justifiable. attributable to COVID on that amount (assuming terms/conditions met) terms/conditions (assuming COVIDon that amount to attributable care expenses” “health and if you revenues” “lost can demonstrate HHS Term Conditionor grounds is the Secretary for to direct recoupment the payments ofsome allof or made.” coronavirus)…Non- torespond and for, prepare prevent, to (e.g., purposes allowable COVID ofactual individuals cases possible or with eligible receive to the funds provides (e.g., provided or after January diagnoses, 2020, 31, testing, for care or associated payment with require thethat Recipient able tobe certify, among other requirements, thatwas it has not“HHS yet detailed how recoupment repaymentor However, will work. the Terms and Conditions FAQs. the as well as terms/conditions the throughout times multiple recoupment A: Yes. mentions HHS does say that it would not recoup based on the amount you received received you amount say on the that based it does recoupwould not - 19) and thethat funds were used in accordance with compliance any with 35 ©2020 CliftonLarsonAllen LLP What We KnowWe What taxation? taxation? to subject dollars Q: Are PRF • Key Takeaway For Create Opportunities - profit entities are taxable, are generally,taxable, not entities payments. payments. Revenue Services’ website at https://www.irs.gov/newsroom/frequentlyat website Services’ Revenue revenue attributable an unrelated to trade businessor as defined more For ininformation, section 513. visit the Internal the Provider Relief Fund may subjectbe under tax to the if payment section 511 reimburses the provider expenses for lostor federal income taxation under section 501(a). Nonetheless, a payment received by a tax Nonetheless, taxationpayment sectiona federal income under 501(a). received by a 7/10/2020) Is atax Is A: Yes A: https://www.irs.gov/newsroom/frequently information,more For Code.visittheInternal the Revenueof sectionServices’ 61 website at disaster relief payment under section The payment 139. thefrom Provider Relief Fund includible is in income gross under 7/10/2020) (Added (Code)? Code Revenue Internal the of 139 section payment under relief disaster qualified a as income gross from payment this exclude Fund Relief Provider the payment from a receives that provider care health a May - exempt health care provider subject to tax on a payment it receives from the Provider Relief Fund? (Added (Added Fund? Relief Provider the from receives payment it a on tax subject to provider care health exempt and no, depending on entity type. type. on entity depending no, and Generally, health A providerno. care isthat described sectionthe Code generally ofin 501(c) is exempt from No. A payment payment A No. a business, to even theif business a sole proprietorship,is notdoes qualified qualify as a - for - askedquestions - profits are excluded from taxation from excluded are profits - about - taxation - asked - of - provider - questions - relief - exempt health care provider health provider from care exempt - - HHS, IRS FAQs released FAQs released IRS HHS, July 10 on abouttaxation- - payments. of - provider - relief - 36 ©2020 CliftonLarsonAllen LLP What We KnowWe What • • Key for? dollars PRF the use Q: • • Talk with your legal counsel if you have questions have you if counsel legal your Talk with reasoning Detailed Evaluatin essential is COVID funds of tracking and specific Accurate What can I can What Takeaway Create Opportunities g how and if a desired use of these funds relates back to COVID to back relates funds these of use desired a if and g how A • indicates: that term/condition this to related FAQ attributablerevenuesare coronavirus.” related lostthat to health expenses or care for Recipient only Recipient certifies thethat Payment used only be willprevent, to prepare and for, respond to coronavirus, and shall reimbur supplies,structures, medical • : Statutorily, the CARES of and CARES acceptable uses list Act provide Statutorily, PPP HCE a Act & the : can respond to the coronavirus by maintaining healthcare delivery capacity, delivery healthcare maintaining by coronavirus the to respond can t so revenue lost cover to funds of coronavirus. Specifically“encourages” to theresponds use or HHSprevents, for, prepares increased or services, Lost revenues attributable to Health care related expenses attributable expenses related care Health and justification for your use of the funds based on your interpretation of HHS guidance HHS of interpretation your on based funds the of use your for justification and • • • • • • • • Electronic health record licensing fees fees record licensing • Electronic health payments lease • Equipment payments • Rent or mortgage insurance health • Employee payroll contractor or Employee • acquiring additional resources, including facilities,equipment, supplies, healthcare practices,staffing, and technologyto exp area from where COVID where from area building or constructingtemporary structures to expand capacityfor COVID reporting COVID developing staffingand emergency operation centers; workforce training; equipmentusedprovide to healthcareservices for possible or actualCOVID supplies usedprovide tohealthcare servicesfor possibleor actual COVID - 19 test results to federal, state,or local governments; UC ). - 19 patients are being treated; treated; being are 19 patients PRF can becan used toPRF PPE, PPE, COVID is is COVID testing supplies any revenue lost revenue any to COVID cover COVID to cover cover costany that revenue the lost otherwise would covered, have so long as thatcost etc.), but notit’s an exhaustive There list. also is a key term/condition: due to coronavirusdue to items and services to prevent, prepare for, and respond to COVID: respond and to COVID: for, prepare to items prevent, and services - 19 patients; patients; 19 - - 19 patient care or to provide healthcare to non services healthcare 19 or care to provide patient 19 patients; patients; 19 ( exs including: : fewer fewer outpatient visits, canceled elective procedures or ( exs : building or construction of temporary temporary of construction or building and or preserve care delivery care preserve or and On June 2, HHS released HHS 2, June On - COVID - 19 patientsseparate a in hat providers providers “ The The se se the the an an 37 ©2020 CliftonLarsonAllen LLP What We What We Don’tFully Know • • Your Takeaway: type? termsrevenue of in payments PRF classify providersshould how and grant a a dollars or loan Q: CLA awaits further guidance on exactly how to treat these dollars these treat to how exactly on guidance further awaits CLA recouped be can they since revenue/restricted liability/deferred a as viewed be should they CLA believes therefore, to need may says repaid; be funds specifically HHS Arethe PRF Create Opportunities reports.” -- cost on reported be should it how and care uncompensated of for purposes treated A: distribution Medicaid during date…” date…” later a at repaid be to need not do payments met, are conditions and terms these A: “CMS will issue guidance guidance issue “CMS Provider how about will Relief be payments Fund should “Retention and use of these funds are subject to certain terms and conditions. If If conditions. and certainto terms subjectare funds these of use “Retention and -- HHS FAQ. HHS HHS FAQHHS “ This is neither is neither nora loan a This grant. is This apayment.” – webinar webinar HHS HHS 38 ©2020 CliftonLarsonAllen LLP What What • • • Key Takeaway requirements? reporting Q: Are there there Are Detailed tracking final a report) second, (i.e.: 2021 July to31, usefunds by deadline establishes requirement a reporting This to report required more will or be $10,000 with Anyone Create Opportunities We Don’t Fully Know 3. 2. 1. A: A: Yes. There /categorization of lost revenues, PRF funds, use of funds and documentation/justification compliance for be necessary /categorization documentation/justification will use of funds PRF and funds, of revenues, lost necessary data elements will be available through the HRSA website by August 17, 2020. 17, August by website HRSA the through available be will elements data necessary distributions.PRF theall applies torequirement payments exceeding $10,000 (aggregate)fileto need will receives that recipient Any reporting requirements. on these more information 20, HHS released On July such reports of the coming in weeks.” submit future reports relating the recipient’s to PRFits money. use of Pandemic the or HHS to report separate quarterly states which HHS FAQ 13), (June per required, longer who receive those For compliance to ensure terms/conditions. with needed HHS has a catch • • • Recipients with funds unexpended after Dec. 31, 2020, must submit a second and final report no later than July 31, 2021. 2021. 31, July than no later report final and second a submit must 2020, 31, Dec. after unexpended funds with Recipients the window that beginsOct. 1, 2020, but no later than Feb. 15, time during 2021. any at report final single a submit may 2020 31, December to prior in full funds expended have who Recipients 45 must within 31, Dec. of report days All endrecipients 2020. ending period through of CYon 2020 expenditures are several statutorily required and terms/conditions specific to this. this. to specific terms/conditions and required statutorily several are - all all reporting requirement that indicates recipients be will required to submit whatever HHS determines is more than $150,000 in funds combined between all COVID report no is quarterly a packages, COVID relief all funds combined in between more than $150,000 Detailed PRF reporting instructions and a data collection template with the with template collection data a and instructions reporting PRF Detailed Response Accountability Committee…HHS will be requiring recipients to recipients requiring AccountabilityResponse be Committee…HHSwill “Recipients of Provider Relief Fund payments do not need to submit a toneed not Fund:Provider “Recipients do payments Relief of reports demonstrating compliance terms/conditions. The terms/conditions. compliance demonstrating reports HHS will notifywillHHS recipients the contentof and due date( one or more orone s) s) 39 ©2020 CliftonLarsonAllen LLP What We KnowWe What • • Your Takeaway: dollars? use mymust PRF I which by deadline there Is Q: As you move through the weeks and months ahead, keep July 31, 2021 in in keep ahead, sight 31,for use. 2021July PRF the months and weeks throughAs move you onto. held to not used, be funds expects HHS Create Opportunities a HHS the released following FAQs: related expenses or lost revenue attributable to coronavirus.to revenue attributable or expenses lost related documentation to these substantiate were funds that for used healthcare increased of submission the require Terms which the to attest Conditions, must and recipients anyand collect Relief Fund that were amounts inappropriately.used All payment HHS reserves funds. unused right to the Provideraudit Relief Fund in recipients future the bypayments that date and accordingly31, 2021, than July HHS expects that providers fully expend will their website, …” “ A: Yes. indicated informationwhich HHSa requirements released reporting second a As explained explained As the in notice reporting requirements of the on Provider Relief Fund reports on the use of Provider Relief Fund money must be submitted no later later no submitted be must money Provider Fund Relief of use the on reports nd finalreport later no than July 31,2021 . . provide HHS will future the directions in how about returnto ” ” is due. Then on July 30, Then on July is due. 40 ©2020 CliftonLarsonAllen LLP WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING AND TAX, AUDIT, | OUTSOURCING | ADVISORY WEALTH Questions? Investment advisory services are offered through CliftonLarsonAllen Wealth Advisors, LLC, an SEC an LLC, Advisors, Wealth CliftonLarsonAllen through offered are services advisory Investment - registered investment advisor 41 ©2020 CliftonLarsonAllen LLP information and insights information insights and on a host of issues. CLA’s CLA COVID http://blogs.claconnect.com/healthcareinnovation Health Care Innovation and Insight | HI Insight | Innovation Care and Health The CLA COVID CLA The HI Create Opportunities 2 blog provides health care specifics care specifics health provides blog provide ease of access totimelyaccess relevant ofandease provide - 19 Resources 19 - 19 Information Hub was developed to to developed was Hub 19 Information information in six categories. categories. six in information 2 https://www.claconnect.com/COVID19 42 ©2020 CliftonLarsonAllen LLP 608- [email protected] of Director Health Care Policy & Innovation Boese,Jennifer MS THANK YOU! YOU! THANK 507- [email protected] Principal Fast, Trenton 662- 446- 7635 7118 7118 CPA CLAconnect.com

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