Federal Government Agencies Accelerate Review of COVID-19 Provider Relief Fund Expenditures

On August 27, 2021, the Biden administration announced it has hired several separate outside contractors to police the billions in COVID-19 grants it sent to hospitals and health care providers.

The contracts, which have not previously been reported, are a sign that the federal government is beefing up enforcement on the grants that were intended to help health care providers recover from the pandemic. The Trump administration faced criticism for initially sending money out to health care providers based on past income, and not on need, and punted a difficult oversight process to the Biden team. As the Biden administration starts to crack down on its bookkeeping, the pace of sending out new funds has slowed.

Roughly a quarter of the money Congress set aside to help providers recover from COVID-19—more than $50 billion—remains unspent. The Department of Health and Human Services (HHS) has not sent out another major tranche of funding since October 2020 — meaning no meaningful funds went out to help with last winter’s massive surges or the surges this summer as the Delta variant has spread.

The rules for how providers could use the grants changed over time, stoking anxiety from providers about how the money will be policed. Many eyes are on the program—in addition to the new contractors, an independent HHS watchdog has also opened six of its own audits and inspections into how the federal government sent out funds through the Provider Relief Fund program.

Altogether, the administration is spending $9.4 million to make sure the $187 billion in grants were used properly, according to a federal database. The Health Resources and Services Administration said the firms were hired as part of routine audit requirements for a program of this size and scope.

Separately, on Thursday, August 26, 2021, a bipartisan group of 43 senators sent a letter to pressure HHS Secretary Xavier Becerra to release plans for how the remaining provider relief funds are to be spent.

To read the letter to Secretary Becerra, see the attached PDF.