David Schless headshot
David Schless

As Friday’s deadline to apply for Phase 3 monies from the Coronavirus Aid, Relief, and Economic Security (CARES) Act Provider Relief Fund approaches, the American Seniors Housing Association is seeking clarification from the Department of Health and Human Services about “conflicting information” posted by the department.

In updated FAQs posted Oct. 28, HHS said that providers reporting use of the funds toward lost revenues attributable to the coronavirus should report actual patient care revenues and expenses for 2019 and 2020, to allow for a year-over-year calculation of change in revenue, ASHA President David Schless noted Monday in a letter to HHS Secretary Alex Azar.

This instruction, however, conflicts with earlier guidance that continues to be included in the Oct. 28 FAQs, which endorses “any reasonable method of estimating the revenue … had COVID-19 not appeared” and says that one way to estimate lost revenue is the “difference between your budgeted and actual revenue,” Schless pointed out.

“These two responses are obviously inconsistent, and we strongly encourage HHS to permit budgeted or other reasonable approaches to estimate lost revenue,” Schless wrote. Without a clarification, he added, the guidance “is extremely problematic” for some senior living communities that opened for occupancy in mid or late 2019.

“This methodology works for fully stabilized operating assisted living communities, but it does not capture the actual lost revenue experienced by communities that were in lease-up during 2019,” Schless said. “These communities would have experienced far lower occupancies and revenue throughout 2019 than were expected in 2020.”

It is “far more accurate” for these lease-up communities to determine the negative impact of the coronavirus on revenue generation by looking at budgeted 2020 occupancy and revenue or to the actual occupancy and revenue generated in the months leading up to the pandemic, with a reasonable allowance for continued lease-up in the case of communities that had not yet achieved stabilized occupancy during the pre-pandemic months, ASHA maintains.

Monday’s letter follows one earlier this month in which Schless and Argentum President and CEO James Balda questioned Provider Relief Fund reporting guidance from HHS. The federal agency said it received “significant attention and opposition from many stakeholders and members of Congress” about its definition of “lost revenue” so subsequently changed it. 

ASHA also said Monday that it is seeking further clarification about post-payment reporting requirements, as it believes that updated guidance from HHS “will likely lead to a substantial amount of confusion and reporting difficulties” for senior living operators who sought aid from the Provider Relief Fund.

Requirements dated Oct. 22 and the FAQs dated Oct. 28 present “a far more difficult analysis of COVID-19 healthcare related expenses and lost revenues than necessary,” Schless wrote.