The U.S. Centers for Medicare & Medicaid Services (CMS) announced on March 28, 2020, it was expanding its accelerated and advance payment program for Medicare providers, to address a need to further support the organizations on the front line battling the COVID-19 pandemic. For providers, COVID-19 has affected cash flow in a variety of ways. Providers on the front lines caring for COVID-19 patients such as hospitals, emergency medicine physician groups, diagnostic test labs, home health agencies and long-term care providers, cash flow must dramatically increase to match dramatically increased costs for more personal protective equipment, ventilators, supplies, drugs, beds, critical care space and increased professional staff coverage. At the same time, for providers who had provided elective services such as ambulatory surgery centers and some physician groups, cash flow has nearly stopped becoming an existential crisis. CMS Administrator Seema Verma framed the policy issue in the following way, “With our nation’s health care providers on the front lines in the fight against COVID-19, dollars and cents shouldn’t be adding to their worries.”
What is an Accelerated/Advance Payment?
Ordinarily, Medicare can make advance/accelerated payments to providers when there is a disruption in claims submission and/or claims processing. This authority for expedited payments also extends to public health emergencies or natural disasters to accelerate cash flow to impacted providers and suppliers who submit a request to their Medicare Administrative Contractor (MAC) and meet the qualifications.
Key Takeaway: The accelerated/advance payment are similar to interest-free bridge loans being offered through other federal programs at the moment. Under the circumstances, all Medicare providers and suppliers should seriously consider this program option.
Who is Eligible to Receive Accelerated/Advance Payments?
To qualify, a Medicare provider or supplier must:
- Have billed Medicare for claims within 180 days prior to the date of signing the request form.
- Not be in bankruptcy.
- Not be under active medical review or program integrity investigation.
- Not have any outstanding delinquent Medicare overpayments.
How much can a provider/supplier receive?
Those providers and suppliers who meet the qualifications should request a specific amount on the Accelerated or Advance Payment Request form that will be available on each MAC’s website. CMS stated the amount available will vary by provider type:
- Most Part B providers will be able to request up to 100% of their historical Medicare payment for a 3-month period.
- Most Part A providers such as acute care hospitals may request up to 100% of their historical Medicare payment amount for a 6-month period.
- Critical Access Hospitals may request up to 125% of their payment amount for a 6-month period.
How long will it take to receive an accelerated/advance payment?
CMS has directed each MAC to review and process each request and issue payment within seven calendar days of receipt of the request.
When must the accelerated/advance payment be repaid?
CMS is extending repayment to begin 120 days after the accelerated/advance payment has been issued. During the 120-day period, providers/suppliers will receive full payment for their claims submitted. At the end of the 120-day period, the recoupment process will commence. At that point, every claim submitted will be offset from the new claims to repay the accelerated/advance payment. The following process applies by provider type:
- Hospitals (including CAHs) have one year to repay the balance. After one year, the MACs will perform a manual check to determine if there is a remaining balance. If so, the MACs will send a request for repayment of the remaining balance by direct payment.
- All other Part A providers and Part B suppliers will have 210 days to repay.
Where can I get more information about the accelerated/advance payment process?
Please contact your regular Taft Health & Life Sciences Group attorney for more information and advice about this new program and many other programs available to help alleviate cash flow and liquidity issues for health industry participants.
There is a step-by-step guide contained within a CMS Fact Sheet available here.
Please visit our COVID-19 Toolkit for all of Taft’s updates on the coronavirus.