Update on Medicare Advanced and Accelerated Payment Program AND Potential New Round of CARES Provider Relief Funding


Within the past few days, the US government and HHS have made two announcements that relate to funding for HMA clients that treat COVID patients.

Earlier in the year, some HMA clients applied for Medicare Advanced and Accelerated Payment Program (AAP) loans (see previous HMA blog entry https://www.hmamass.com/blog/cms-program-to-advance-medicare-payments-to-physicians/ ). Under the original terms of this loan, at the end of the 120-day period the recoupment process will begin and every claim submitted by the provider or supplier was to be offset from the new claims to repay the accelerated/advance payment. 

One of the provisions included as a part of the new law recently passed and signed (HR 8337, Short Term Continuing Resolution to fund the government through December 11), increased the repayment period for the APP loan to 29 months before a demand letter is submitted. During the 29-month period, there would be no claims offset for the first 12 months, a 25% payment offset for the next 11 months and 50% offset for the final six months. The legislation would also reduce the interest rate applied to any funds outstanding after the initial 29-month period to 4%. 


Additionally, the U.S. Department of Health and Human Services (HHS), through the Health Resources and Services Administration (HRSA), has announced $20 billion in new funding for providers on the frontlines of the coronavirus pandemic (Provider Relief Funding “PRF or HHS 3” (click here):


More information is available by reviewing (click here).


According to Melanie Binder of the Healthcare Financial Management Association, “Based on HHS’s press release, it appears this distribution will first “top-off” any provider that did has not received approximately 2% of its patient care revenue.” Then she offers, “With the remaining balance of the $20 billion budget, HRSA will then calculate an equitable add-on payment that considers the following: A provider’s change in operating revenues from patient care; A provider’s change in operating expenses from patient care, including expenses incurred related to coronavirus; and payments already received through prior Provider Relief Fund distributions.”


HMA is in the process of reviewing all of this new information for our clients.  In particular, based on the information provided over the past few weeks related to the reporting requirements for HHS 1 and HHS 2 funding (see previous HMA blog entry: https://www.hmamass.com/blog/hhs-publishes-reporting-requirements-for-provider-relief-fund-prf/), we are trying to determine if HMA clients will be able to meet the criteria for keeping those funds as well as meeting the eligibility requirements for this new HHS 3 funding.


There are still many unknowns and clarifications needed…stay tuned!

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