The Department of Health and Human Services (HHS) has broadened the eligibility criteria for behavioral health providers seeking financial support through the Provider Relief Fund. This move comes as part of ongoing efforts to support healthcare organizations struggling with the economic fallout of the COVID-19 pandemic. With the new guidelines in place, providers who were previously excluded now have an opportunity to apply for relief funding, giving them a much-needed financial lifeline.
The Provider Relief Fund Background
The Provider Relief Fund was originally established under the CARES Act in the early stages of the pandemic. Its primary purpose has been to help healthcare organizations offset the significant revenue losses and increased operational costs that emerged as COVID-19 disrupted normal services. Under the initial rules, the fund was primarily directed at providers who billed federal payers such as Medicare and Medicaid. These organizations could typically receive relief equivalent to 2% of their annual patient care revenue, which for many created some stability during unprecedented times.
While this helped thousands of providers, the exclusion of behavioral health organizations that rely on commercial insurance or private pay models left a critical gap. Many behavioral health centers, counseling practices, and substance use treatment programs do not rely heavily on Medicare or Medicaid reimbursements. As a result, these providers struggled to maintain operations without access to the same level of federal relief as other healthcare entities.
Expanded Eligibility For Behavioral Health Providers
HHS has now clarified that a much broader group of behavioral health providers can apply for funding in this phase of relief distribution. Specifically, the eligibility now extends to:
- Behavioral health providers who billed a commercial health insurance company as of March 31, 2020.
- Behavioral health organizations that do not accept insurance but billed patients directly for health-related services as of March 31, 2020.
- Organizations that began providing services in 2020.
- Providers who bill Medicare and Medicaid but have not yet applied for relief.
This expansion marks an important shift because it recognizes that behavioral health providers across all payment models have faced significant challenges due to the pandemic. For instance, private-pay practices that offer mental health counseling, addiction treatment, or psychiatric services often saw revenue plummet when patients were unable to attend in-person appointments or lost income themselves. Similarly, organizations that started operations in 2020 were at a disadvantage because they had no prior financial history to qualify under previous rules.
Addressing Confusion In The Announcement
When HHS first released the news of expanded eligibility, there was some confusion among providers about who exactly qualified. The relief portal has since clarified these details, making it easier for organizations to determine their eligibility and apply. This clarity is essential because behavioral health providers have been among the hardest hit by the pandemic’s economic toll. Unlike large hospital systems, many smaller counseling centers and treatment programs operate on thin financial margins and cannot withstand prolonged revenue disruptions.
Applying For Relief
Applications for this new round of funding opened on October 5 and will remain open until November 6. Providers are encouraged to submit their applications as soon as possible to ensure they do not miss out on the opportunity. The $20 billion allocated for this phase of relief funding is intended to reach as many eligible providers as possible.
The process requires providers to demonstrate their revenue from patient care and to confirm they meet the updated eligibility requirements. While the relief fund aims to distribute payments quickly, providers are advised to prepare all necessary documentation in advance to avoid delays.
Supplemental Payments For Behavioral Health Providers
In addition to the new eligibility rules, behavioral health providers who have already received their full 2% payment from the Provider Relief Fund may also apply for supplemental aid. This option is especially important for organizations that continue to face financial difficulties due to changes in operating expenses or reduced patient volume caused by COVID-19.
However, there remains some uncertainty about how supplemental payments will be handled. Chuck Ingoglia, president and CEO of the National Council for Behavioral Health, has noted that details are still unclear. It is not yet known whether supplemental payments will only be distributed after all eligible providers receive their initial 2% or whether they will be distributed concurrently. Additionally, the size and structure of these supplemental payments have not been finalized.
Despite this uncertainty, many in the behavioral health field see the option for supplemental payments as an important step forward. It signals recognition from the federal government that the financial pressures on behavioral health organizations are ongoing and may require more than the initial round of relief.
Why This Matters For Behavioral Health
The expanded eligibility criteria represent a significant development for behavioral health providers and the communities they serve. Throughout the pandemic, the demand for mental health and addiction treatment services has surged. Social isolation, job loss, and the stress of the health crisis have contributed to increased rates of anxiety, depression, and substance use disorders.
At the same time, many behavioral health organizations were forced to cut back on services, reduce staff, or even shut down entirely due to financial strain. Without adequate funding, the behavioral health system risks being unable to meet the growing needs of patients. By opening up the Provider Relief Fund to more providers, HHS is helping to stabilize these organizations and ensure continued access to care.
A Step In The Right Direction
Although questions remain about the specifics of supplemental payments, the expanded eligibility for relief funding is widely seen as a positive step. Leaders in the field have applauded the decision, noting that it acknowledges the unique challenges behavioral health providers face. For many organizations, this funding could mean the difference between continuing operations and shutting their doors.
Chuck Ingoglia emphasized that while details still need clarification, the inclusion of more providers is ultimately a move in the right direction. It not only helps individual organizations but also strengthens the overall behavioral health system at a time when it is under immense pressure.
Looking Ahead
As the pandemic continues, behavioral health providers will likely need ongoing support to adapt to changing circumstances. Telehealth has become a critical tool for maintaining patient access, but it also comes with new costs and challenges. The expanded Provider Relief Fund offers some financial relief, but long-term solutions will be necessary to sustain the behavioral health workforce and meet increasing demand.
Providers have until November 6 to apply for this round of funding, and more guidance from HHS is expected regarding supplemental payments. In the meantime, behavioral health organizations should act quickly to secure the support they need.
Conclusion
The announcement from HHS expanding eligibility for the Provider Relief Fund is a critical moment for behavioral health providers nationwide. By including organizations that rely on commercial insurance, private pay, and those newly established in 2020, the federal government is recognizing the vital role behavioral health plays in the healthcare system. While questions remain about the distribution of supplemental payments, the expanded access to funding is an encouraging step toward stability. For providers working tirelessly to support individuals struggling with mental health and addiction during the pandemic, this relief could not come at a more crucial time.
