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Providers get more time to repay COVID relief

Oct 1, 2020

President Trump today signed a continuing resolution that will fund the federal government until December 11, 2020. The continuing resolution (the “CR”) also grants relief to the providers and suppliers that were preparing to repay the Medicare accelerated or advance payments they received in response to the COVID-19 pandemic. Specifically, the CR extended the repayment period, limited CMS’s ability to offset claims to recoup the accelerated or advance payments, and lowered the interest rate on the unpaid balance of these payments. The resolution, HR8337, Sec. 2501, can be found here.

The Medicare Accelerated and Advance Payment Program (the “Program”) is intended provide funding to healthcare providers during national emergencies or natural disasters. As part of its response to the COVID-19 pandemic, Congress expanded the Program by making it available to numerous healthcare facilities and practitioners.  

Program payments are loans must be repaid to CMS. Originally, most hospitals had one year to repay their accelerated or advanced payments while other Part A providers and Part B suppliers had 210 days to do so. Under the CR, providers and suppliers now have 29 months from the date of their first Program payment to repay the full amount of the accelerated or advance payments they have received.

The Program’s original requirements stated that providers and suppliers would continue to receive full payment for their claims for 120 days after their first accelerated or advance payment. After 120 days, CMS would have begun offsetting their claims to repay the accelerated or advance payments. According to the CR, CMS cannot offset any claims for one year. Additionally, during the first 11 months of the offset period, the offset will be limited to 25% of the claims due to the provider or supplier. During the last six months, the offset will be 50% of the claims due to the provider.

In addition to extending the repayment period and limiting CMS’s ability to offset claims, the CR lowers the interest rate on the unpaid balance of Program payments to 4%. The previous rate, which was set by the Secretary of the Treasury, was nearly 10%.

 

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