Shaheen & Bennet Call on Trump Admin to Delay Start of Recoupment Period of Medicare Payments Program for Health Care Providers on Frontlines of Pandemic

August 07, 2020

(Washington, DC) – U.S. Senators Jeanne Shaheen (D-NH) and Michael Bennet (D-CO) called on the administration today to delay the start of the recoupment period for health care providers under the Medicare Accelerated and Advance Payments (AAP) program. Under the AAP program, this week, the Centers for Medicare and Medicaid Services (CMS) is scheduled to start withholding payment on 100 percent of all otherwise payable Medicare claims that health care providers submit for reimbursement until the loans obtained through the AAP have been paid off.

The AAP program was expanded under the Coronavirus Aid, Relief, and Economic Security (CARES) Act to allow for hospitals, physicians and other Medicare-participating providers to apply for upfront payments from Medicare to help cover revenue shortfalls as a result of COVID-19. To date, New Hampshire providers have received $689 million in upfront payments through this program to mitigate the economic shortfall caused by the pandemic. Across the nation, this program has delivered more than $100 billion in upfront payments to health care providers.

The Senators wrote, in part, “The nation’s health care system has never been confronted with such devastating and complex problems as the ones resulting from the novel coronavirus or “COVID-19.” Given these challenges, we urge you to delay the start of the recoupment period under the Medicare Accelerated and Advance Payments (AAP) program, which we understand is scheduled to begin this month for hospitals, physician practices, nursing facilities and other health care providers.”

They continued, “As our nation has continued to struggle to mitigate the spread of this virus, the financial impact on our health care providers has been deeper and has extended longer than we anticipated at the time of the passage of the Coronavirus Aid, Relief and Economic Security (CARES) Act. Our economic recovery must include stabilizing and sustaining our hospitals and health care providers, allowing them to make payroll and improve cash flow. The AAP program served as a critical financial bridge for both the hospitals and their frontline workers to help maintain cash flow. Since the CARES Act passed, hospitals and health care providers across the United States have received approximately $100 billion in upfront payments through the program.”

Under the AAP program, this non-payment of claims during this “recoupment period” continues until the full balance of the loan that the health care provider received is paid off. The Senators closed their letter by highlighting the significant financial stress that hospitals, nursing facilities, physician practices and other health care providers are still under and that now is not the time to exacerbate the situation by drying up Medicare revenues for providers. The Senators concluded, “We all share the goal of relieving cash-strapped hospitals and providers and helping them to move to stronger financial footing, but we need to recognize that premature repayment deadlines could undermine the fragile steps to that strong financial stability.”

The letter can be read in full here.

Last month, the Senators led a letter to Senate and House leadership with Senator Debbie Stabenow (D-MI), calling for future COVID-19 response legislation to include modifications to repayment obligations and provide an opportunity for loan forgiveness for health care providers who’ve sought financial assistance amid the coronavirus pandemic through the AAP program.

Senators Shaheen and Bennet also recently introduced legislation to address concerns related to the AAP program. Senator Shaheen previously included this issue in her list of health care priorities in future COVID-19 relief legislation. Senator Shaheen and Senator Bill Cassidy (R-LA) led a bipartisan letter to the Trump administration in April, urging CMS to waive or modify interest rates for health care providers who’ve sought financial assistance through the program.