Fewer target Provider Relief Fund (PRF) payments sent to hospitals during the COVID-19 pandemic’s opening year reached hospitals serving patient populations with more Hispanic/Latino Americans, according to a recent report from the Department of Health and Human Services (HHS) Office of Inspector General (OIG).
The watchdog agency’s analysis found that per-person PRF funds did not differ based on a hospital community’s poverty rates.
When reviewing race and ethnicity census data, however, OIG found that communities with greater concentrations of Hispanic/Latino residents were associated with lower payments than those with smaller concentrations of that demographic, according to the report.
Meanwhile, nonrural areas with greater concentrations of non-Hispanic Black residents were associated with greater per-person PRF payments than those with smaller concentrations of non-Hispanic Blacks, OIG found. This trend did not persist when reviewing payments in rural areas.
Further review of specific PRF payment allotments—subsets of the allocations targeted for specific types of hospitals, such as safety net hospitals—revealed that rural hospitals with greater concentrations of either of these demographics were tied to less PRF funding than hospitals with smaller communities of Hispanic/Latino or non-Hispanic Black residents, according to the report.
“Differences in hospital funding with respect to the characteristics of the populations hospitals serve—including race and ethnicity—could potentially exacerbate pre-existing disparities in health outcomes,” OIG wrote in its report (PDF). “If hospitals that serve populations experiencing disparate health outcomes are under-resourced, those populations may be left with less access to high-quality care, which could widen gaps in health outcomes.”
Congress appropriated a total $178 billion in funds in 2020 to reimburse hospitals for lost revenues and higher expenses related to COVID-19. The lawmakers delegated the distribution of these PRF payments to HHS with instructions to be swift and use “the most efficient payment systems practicable,” a guideline that did not require the payment allocations to consider their impacts on health disparities.
OIG’s review of the PRF allocations was limited to $43 billion that went to hospitals (excluding facilities such as nursing homes as well as children’s hospitals) during 2020. The funds spanned four allotments for high-impact hospitals ($20.7 billion), safety net hospitals ($12.5 billion), rural hospitals ($9.7 billion) and tribal hospitals ($180 million).
To characterize hospitals’ populations, OIG used Medicare data describing the census tracts served by a hospital. The watchdog then matched those data to the PRF payments received by a hospital and sought racial, ethnic and economic correlations on a “PRF per person” basis.
OIG wrote that its work to better understand how the PRF money was distributed can inform HHS’ planning and strategic decisions for any future emergency funding events, particularly those focusing on rural communities.
“Because statutory parameters can impact HHS’ ability to direct funding, it may also be important for HHS to engage with Congress regarding the authority needed to most effectively consider health equity, alongside other priorities like efficiency and expeditiousness, in emergency funding scenarios,” OIG wrote.
Not all of the PRF money sent to hospitals stuck, as many organizations chose to return funds they were unable or did not need to spend within a year as required. The total amount returned has so far been unclear, as has been exactly how the government chose to use the funds that were sent back, a late 2022 report from Urban Institute noted.