The looming June 30, 2021 deadline to spend certain COVID-19 provider relief grants has caused the American Hospital Association (AHA) to appeal for an extension. Earlier this month, HHS offered partial relief from that deadline by announcing four separate deadlines by which providers will have to spend or return unused provider relief fund grants to the federal government, depending on when those payments were originally received. 

But that action will not relieve the obligation many hospitals and other providers will have to return a significant amount of unspent relief funds. Provider relief funds (PRF) received between April 10 and June 30, 2020 still need to be returned by June 30, 2021 if providers do not have the COVID expenses or lost revenue to justify keeping those funds. The bulk of the provider relief funds were issued in those early days of the COVID-19 crisis. Seeing the reality of massive refunds, the AHA has re-launched its efforts to urge HHS to allow providers to keep PRF money distributed before June 30, 2020 until either the end of the COVID public health emergency or until June 30, 2022.

This is an important discussion, and the Biden Administration is facing an important decision. If an overall extension is not granted, many health care providers who received grants in the spring of last year will have a significant provider relief funds refund obligation.