The federal government began sending $1.1 billion in coronavirus relief funding to nursing homes this week to help providers cope with lost revenues and increased expenses caused by the pandemic. 

The Department of Health and Human Services on Wednesday announced plans to distribute $24.5 billion to more than 70,000 healthcare providers as part of Phase 3 of the Provider Relief Fund program. HHS expects the funding to cover up to 88% of providers’ reported losses. 

Nursing homes will receive $1.1 billion of the Phase 3 funding, building on the incentive payment program and $15 billion in aggregate funding already distributed, the agency noted.

LeadingAge President and CEO Katie Smith Sloan called funding distribution “an important acknowledgement of the financial losses that have been mounting for nursing homes, assisted living and other providers across the care continuum throughout the pandemic.” 

“What’s more, it also recognizes that while expenses on critical needs such as [personal protective equipment], tests and staff have risen across the board throughout the pandemic, they’ve spiked at times when communities experienced a case surge,” Sloan said. “Aging services providers across the continuum of care need help right now and into the future. Even after vaccines have been administered, the threat from coronavirus remains.” 

“Federal aid is critical during this time when providers are dealing with record cases and deaths due to high community spread, and therefore, dedicating extensive resources to fight this virus,” added Mark Parkinson, president and CEO of the American Health Care Association/National Center for Assisted Living.

“Our healthcare heroes are doing everything they can to prevent COVID-19 from spreading further, but the level of COVID nationwide in communities puts serious strain on our workforce, supplies, and testing capacity. Since it will likely take months to vaccinate our population, these payments give our providers a fighting chance to battle this horrible virus and keep our doors open,” Parkinson added.

HHS in May announced a $4.9 billion fund for skilled nursing operators impacted by the public health emergency. The Trump administration in July followed that move by announcing an additional $5 billion in funding specifically for nursing homes.

The Provider Relief Fund has also previously distributed $15 billion to Medicaid providers and $55 billion for Medicare providers.

“HHS is providing more than $24 billion in new relief to more than 70,000 healthcare providers, meeting close to 90 percent of the losses they’ve reported from the COVID-19 pandemic in the first half of the year,” HHS Secretary Alex Azar said in a statement. 

“With the Provider Relief Fund, we’ve been able to support providers hardest hit by COVID-19, including safety net hospitals, rural providers, and nursing homes, helping ensure they can continue serving their communities during and beyond the pandemic,” he added. 

Terms and conditions of the Phase 3 funding are available here.