Shaheen Praises Inclusion of Significant Reforms to Medicare Payments Program Helping Providers on the Frontlines in Must-Pass Government Funding Legislation
(Washington, DC)—U.S. Senator Jeanne Shaheen (D-NH) issued the following statement after the House Appropriations Committee released legislation that funds the government until December 11th and includes a key provision responding to Shaheen’s calls to significantly modify the recoupment period on loans to health care providers under the Medicare Accelerated and Advance Payments (AAP) program and lower the interest rates on the loans.
Under the AAP program, the Centers for Medicare and Medicaid Services (CMS) is allowed to withhold 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 legislation released by the House Appropriations Committee would delay the recoupment period for one year after the loan was made, and for the first 11 months of the recoupment, Medicare will only withhold 25 percent –instead of 100 percent – of the payments that would otherwise be made to the provider to reimburse them for Medicare services. After six months, Medicare will only be allowed to withhold 50 percent of the otherwise payable amount. Additionally, the start of the accrual of interest on the loans will be delayed until 29 months after the loan was made, instead of one year. The legislation also reduces the interest rates on loans to 4 percent, which previously could be as high as 10.25 percent. All of these reforms were included in Senator Shaheen and Michael Bennet’s (D-CO) Medicare Accelerated and Advance Payments Improvement Act that was introduced in May.
“The financial hardships on New Hampshire health care providers on the frontlines of this crisis are dire, with some on the brink of closing their doors. That’s why, with these changes to the repayment requirements for loans through the Medicare Accelerated and Advanced Payments program, a number of our providers will be able to breathe a small sigh of relief,” said Shaheen. “We are still in the middle of this crisis – from both health and economic standpoints – so Congress and the administration need to use every tool available to help hospitals and health care providers survive in the weeks and months ahead. While this is an important measure to help hospitals and centers stay afloat, our work is far from over. Additional relief is urgently needed to prevent providers from going under when our communities need them most. I’ll keep pushing for more federal funding that our states and health care providers urgently need.”
Senator Shaheen has been sounding the alarm on this issue since April when she sent a bipartisan letter with Senator Bill Cassidy (R-LA) to the Trump administration, urging CMS to waive or modify the interest rates for health care providers. Just last month, Shaheen and Bennet called on CMS to delay the start of the recoupment period on these loans. Shaheen and Bennet previously led a letter to Senate and House leadership in July, 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. As indicated, Shaheen introduced legislation with Senator Bennet to address concerns related to the AAP program in May. She included this issue in her list of health care priorities in future COVID-19 relief legislation.