CMS Announces New Repayment Terms for Medicare Loans Made to Providers During COVID-19

The Centers for Medicare & Medicaid Services (CMS) announced amended terms for payments issued under the Accelerated and Advance Payment (AAP) Program.  Under the Continuing Appropriations Act, 2021 and Other Extensions Act, repayment will now begin one year from the issuance date of each provider or supplier’s accelerated or advance payment.  

Providers were required to make payments starting in August of this year, but repayment will be delayed until one year after payment was issued.  After that first year, Medicare will automatically recoup 25 percent of Medicare payments otherwise owed to the provider or supplier for eleven months.  At the end of the eleven-month period, recoupment will increase to 50 percent for another six months.  If the provider or supplier is unable to repay the total amount of the AAP during this time-period (a total of 29 months), CMS will issue letters requiring repayment of any outstanding balance, subject to an interest rate of four percent.

Guidance is also provided on how to request an Extended Repayment Schedule (ERS) for providers and suppliers who are experiencing financial hardships.  An ERS is a debt installment payment plan that allows a provider or supplier to pay debts over the course of three years or up to five years in the case of extreme hardship.  Providers and suppliers are encouraged to contact their Medicare Administrative Contractor (MAC) for information on how to request an ERS. 

CLICK HERE to read the full press release from CMS.

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