Item 8.01 Other Events.
Quarterly Report on Form 10-Q
Rennova Health, Inc. (the "Company") is providing the following update on the
filing of our Quarterly Report on Form 10-Q for the quarter ended March 31, 2020
(the "Report"). The Company has determined to rely on the Securities and
Exchange Commission's Order under Section 36 of the Securities Exchange Act of
1934 Modifying Exemptions from the Reporting and Proxy Delivery Requirements for
Public Companies dated March 25, 2020 (Release No. 34-88465) to delay the filing
of the Report due to circumstances related to the coronavirus ("COVID-19"). The
COVID-19 pandemic and the steps taken by governments to seek to reduce the
spread of the virus continue to have a severe impact on the economy and the
health care industry in particular. Our hospitals and the rest of our business
continue to experience disruptions due to the pandemic for the reasons described
in our Current Report on Form 8-K filed with the Securities and Exchange
Commission on March 30, 2020. These disruptions are causing the Report, which is
due on May 15, 2020, to be delayed. Consequently, the Company is unable to file
the Report timely. The Company anticipates that it will file the Report no later
than June 29, 2020, which is 45 days after the original due date of the Report.
In light of the current COVID-19 pandemic, the Company will be including the
following Risk Factor in its Annual Report on Form 10-K for the year ended
December 31, 2019, as it may be updated to reflect subsequent events affecting
the Company:
The current and potential effects of the coronavirus pandemic may materially
adversely impact our business, results of operations and financial condition.
The coronavirus pandemic and the steps taken by governments to seek to reduce
its spread have severely impacted the economy and the health care industry in
particular. Hospitals have especially been affected. Small rural hospitals, such
as ours, may be overwhelmed by patients if conditions worsen in their local
areas. Staffing costs, and concerns due to the potential exposure to infections,
may increase, as may the costs of needed medical supplies necessary to keep the
hospitals open. Doctors and patients may defer elective procedures and other
health care services. Travel bans, social distancing and quarantines may limit
access to our facilities. Business closings and layoffs in our local areas may
result in the loss of insurance and adversely affect demand for our services, as
well as the ability of patients and other payers to pay for services as
rendered.
CARES Act
The Company is providing the following update on receipt of Provider Relief
Funds from the United States Department of Health and Human Services ("HHS")
provided to eligible healthcare providers out of the $100 billion Public Health
and Social Services Emergency Fund provided for in the Coronavirus Aid, Relief,
and Economic Security Act. The funds are allocated to eligible healthcare
providers for expenses and lost revenue attributable to the COVID-19 pandemic.
The funds are being released in tranches, and HHS partnered with UnitedHealth
Group to distribute the initial $30 billion in funds by direct deposit to
providers. To date, Company-owned facilities have received approximately
$7,400,000 in relief funds. It is not known if or when Company-owned facilities
will receive any additional funding, although rural providers are named as a
segment of specific providers that will receive additional relief from funds
which have not been distributed to date. The fund payments are grants, not
loans, and HHS will not require repayment, but providers are restricted and the
funds must be used only for grant approved purposes.
Forward-Looking Statements
This report includes "forward-looking statements" within the meaning of the safe
harbor provisions of the United States Private Securities Litigation Reform Act
of 1995. Actual results may differ from expectations and, consequently, you
should not rely on these forward-looking statements as predictions of future
events. Words such as "expect," "estimate," "project," "budget," "forecast,"
"anticipate," "intend," "plan," "may," "will," "could," "should," "believes,"
"predicts," "potential," "continue," and similar expressions are intended to
identify such forward-looking statements. These forward-looking statements
involve significant risks and uncertainties that could cause the actual results
to differ materially from the expected results. Additional information
concerning these and other risk factors are contained in the Company's most
recent filings with the Securities and Exchange Commission. The Company cautions
readers not to place undue reliance upon any forward-looking statements, which
speak only as of the date made. The Company does not undertake or accept any
obligation or undertaking to release publicly any updates or revisions to any
forward-looking statements to reflect any change in their expectations or any
change in events, conditions or circumstances on which any such statement is
based, except as required by law.
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