Accelerated or advance Medicare payments can provide some cash flow as providers and suppliers combat the effects of the Coronavirus (COVID-19) pandemic. This program requires a one-page application and funds may be available as soon as seven days after the provider or supplier applies. These payments are subject to automatic recoupment through claims offsets beginning 120 days after payment issuance.
The Centers for Medicare & Medicaid Services (CMS) issued guidance regarding how providers may access accelerated or advance Medicare payments. CMS has offered this type of relief in the past for providers affected by hurricanes and other natural disasters. CMS announced that the program is now available nationwide during the COVID-19 public health emergency.
To be eligible for accelerated or advance payments, the provider or supplier must:
- Have billed Medicare for claims within 180 days immediately prior to the date of signature on the provider’s/supplier’s request form
- Not be in bankruptcy
- Not be under active medical review or program integrity investigation
- Not have any outstanding delinquent Medicare overpayments.
CMS has not provided further clarification around the scope of these eligibility criteria, and the Medicare Administrative Contractors (MACs) may include additional criteria in their application process. Given the ambiguity, providers and suppliers may need to seek the advice of counsel to determine whether they satisfy the criteria and, if not, what avenues may be available to them.
The payment amount a provider or supplier can request varies. The Coronavirus Aid, Relief, and Economic Security (CARES) Act (which President Donald Trump signed into law on March 27, 2020) expanded the program for hospitals and critical access hospitals (CAHs) in two notable ways. First, inpatient acute care hospitals, children’s hospitals and certain cancer hospitals are able to request up to 100% of their Medicare payment amount; and critical access hospitals are able to request up to 125% of their Medicare payment amount for a six month period. Other providers and suppliers not affected by the CARES Act can request these funds for 100% of their Medicare payment amount for a three month period. Providers and suppliers should keep in mind that they may be asked to submit documentation to support their request, either in connection with the application or at some later date.
Second, while repayment of the advance begins for all participants after 120 days, providers covered by CARES have additional time to repay the balance. Approved participants will receive their prepayment amount and payment for claims submitted. After 120 days, CMS will begin to offset claims for the amount of the accelerated payment. After that, any remaining balance becomes due:
- Inpatient acute care hospitals, children’s hospitals, certain cancer hospitals and critical access hospitals will have up to one year from the date the accelerated payment was made to repay the balance.
- A small subset of Part A providers that receive Period Interim Payment will have their accelerated payment included in the reconciliation and settlement of their final cost report.
- All other Part A providers and Part B suppliers will have 210 days from the date the accelerated or advance payment was made to repay the balance.
To request accelerated or advance payment, a provider or supplier must submit an Accelerated/Advance Payment Request Form specific to the provider or supplier’s MAC. The form is a single page and can be found on the applicable MAC’s website and must be submitted via mail, fax or email to the MAC. The request form generally includes:
- Provider or supplier’s identification information, including legal business name, correspondence address, National Provider Identifier and any other information required by the MAC
- Amount requested based on the provider or supplier’s need
- Reason for the request (i.e., “Delay in provider/supplier billing process of an isolated temporary nature beyond the provider’s/supplier’s normal billing cycle and not attributable to other third party payers or private patients”) and statement that the request is for an accelerated/advance payment due to the COVID-19 pandemic
- Signature of an authorized representative of the provider or supplier.
The MACs are accepting and processing the Accelerated/Advance Payment Request Form effective immediately, and payment for approved requests is anticipated to be issued within seven calendar days of form receipt. Providers should contact their MAC’s COVID-19 hotline if they have questions about accelerated or advance payment requests.
Under guidance released by CMS, providers and suppliers will not have administrative appeal rights related to these accelerated or advance payments. Administrative appeal rights would apply to the extent CMS issued overpayment determinations to recover any unpaid balances on accelerated or advance payments. However, nothing in the available guidance prohibits providers or suppliers from resubmitting a request if the initial request is denied.
Comparing Accelerated Payments to the Provider Relief Funding from CARES
As physicians and hospitals pursue relief from the COVID-19 pandemic, they should consider other options also available to them and the interplay between these models. The CARES Act created a $100 billion Public Health and Social Services Emergency Fund to prevent, prepare for and respond to Coronavirus. The Fund is intended to assist physicians, hospitals and other entities that provide diagnosis, testing or care for individuals with possible or actual cases of Coronavirus. The CARES Act states that these funds may not be used to reimburse expenses or losses that have been reimbursed from other sources or that other sources are obligated to reimburse.
There are several key distinctions between the Public Health Fund and the Accelerated Payment Program. First, the Public Health Fund is intended to pay providers for costs incurred outside of Medicare or Medicaid reimbursable amounts. Examples include building or construction, medical supplies and equipment, testing supplies, and increased workforce and training. In contrast, the Accelerated Payment Program essentially pre-pays providers for their Medicare services. The Public Health Fund offers new money, whereas the Accelerated Payment Program is essentially a cash advance.
The specific criteria for the Public Health Fund are not yet available but we expect to see additional details this week.
Key Takeaway: Medicare providers and suppliers may now participate in CMS’s Accelerated and Advance Payment Program. These accelerated or advance payments would act as immediate resources to assist providers and suppliers in combatting the spread of COVID-19 in the coming months. These payments are subject to automatic repayment through claim offsets beginning 120 days after payment issuance.