CMS begins to recoup more than $ 100 billion in Medicare Expedited and Advance Payments
The federal government last week began recovering additional Medicare payments sent to nursing homes and other health care providers at the height of the coronavirus crisis last year.
The Centers for Medicare & Medicaid Services (CMS) in 2020 distributed more than $ 100 billion in cash to Medicare-certified providers under the Accelerated and Advance Payments (AAP) program, one of many federal initiatives designed to help operators to overcome soaring costs. and other operational issues caused by COVID-19.
Unlike relief funds distributed through the CARES Act, Medicare dollars have always been meant to be loans, with repayment starting one year from the date of first receipt.
This day has come for the first wave of suppliers on March 30, CMS announced last week. Operators will gradually begin to see lighter Medicare payments over the next few weeks as the government uses current repayments to pay off outstanding debts.
Under the terms of the AAP, CMS will retain 25% of a given institution’s Medicare payments for the first 11 months of the payback period, increasing to 50% for an additional six months thereafter. Any unpaid debt will then become due within 30 days, with an interest rate of 4% applied thereafter.
“CMS will show the clawback on remittance notices issued for Medicare Part A and B claims that we process after the first anniversary of the first payment issuance,” the agency said. “The clawback will appear as an adjustment in the Vendor Level Balance (PLB) section of the remittance advice.”
CMS has asked operators to ensure their billing teams are informed of pending lower payments.
The AAP deadline marks another milestone as the federal government abandons its COVID-19 crisis management strategy and slowly begins to do some accounting for the origin of hundreds of billions of dollars in emergency aid.
Originally introduced to the end of March 2020, the AAP lasted for about a month, with the Department of Health and Human Services (HHS) suspending the program end of April As loans in cash and under the CARES Act’s Paycheck Protection Program (PPP) began to flow to operators.
Congress gave operators a break from the initial 120-day repayment period in October, extending the deadline to the current tiered structure and also reducing the eventual interest rate from the original 10% figure.
Main operator Genesis HealthCare has notably received $ 157 million in AAP funds, but Sabra Health Care REIT (Nasdaq: SBRA) CEO Rick Matros observed last May that many retirement home companies were unable to -be not actually used the program because lenders expected them to pay off their lines of credit.
“Most of our operators have not taken advantage of this coin”, Matros said at the time. “It’s just for a decent sized operator, getting three months of Medicare up front is a huge number, so $ 150 million seems more than in terms of operator count that it really does matter. impact.”