Money, Healthcare

Federal authorities announced Wednesday afternoon that they will be distributing about $333 million in first-round performance payments to more than 10,000 nursing homes for their results battling COVID-19.

The funds will be distributed next week, officials said. The rewards are being given to 10,631 nursing homes (more than 77% of the 13,795 eligible). Overall, the recognized nursing homes “contributed to 5,000 fewer COVID-19 infections in nursing homes” in September than in August, officials said.

In addition, against both the infection control and mortality criteria, 10,501 nursing homes (76%) qualified for payments and contributed to 1,200 fewer COVID-19 related nursing home deaths between August and September.

The performance-based payment structure rewards nursing homes that keep new COVID-19 infection and mortality rates among residents lower than the communities they serve, as analyzed against CDC data.

“These $333 million in performance payments are going to nursing homes that have maintained safer environments for residents between August and September,” said Health and Human Services Secretary Alex Azar. “We’ve provided nursing homes with resources and training to improve infection control, and we’re rapidly providing incentives to those facilities that are making progress in the fight against COVID-19.”

Officials originally announced the incentive program in August. Some $2 billion was dedicated to the plan, which is divided into five performance cycles, the first of which resulted in the $333 million announcement Wednesday. Facilities will have four more chances to earn such incentive payments, reflecting performances month-to-month through the end of the year, and then a cumulative period.

“Today’s announcement illustrates how complementing relief payments with outcome-based payments help to yield positive results in improving quality and infection control in nursing homes,” the HHS announcement said.

Providers also expressed their enthusiasm for the first round of rewards, saying the program shows what investment in operators can yield.

“We know that nursing homes in communities with high infection rates are more susceptible to COVID infections. Today’s HHS announcement shows us that over three-quarters of eligible nursing homes beat those odds,” said Katie Smith Sloan, president and CEO of LeadingAge, which represents nonprofit providers of aging services, including nursing homes.”

Payments announced Wednesday reflect a retrospective view of what occurred, meaning recent spikes in many areas of the country could bring much different results and inventive payment levels in the future, Sloan acknowledged.

“Despite these improvements, older adults in nursing homes — and all care settings — continue to be under threat from this pandemic,” she noted. “This new reporting suggests that nursing homes could protect even more residents and care workers with additional help and resources. With a rising count of over 60,000 nursing home deaths to-date, this is no time to declare victory and walk away.”

A state-by-state breakdown on incentive payments from this first cycle is available here. HHS will update this data to capture all recipients as payment disbursements continue. For updates and to learn more about the Provider Relief Program, visit:

HHS announced $5 billion in targeted funding for nursing homes in May and followed up with another $5 billion opportunity in August. Some $2.5 billion was distributed in early September to assist operators with upfront expenses related to COVID-19.