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More Provider Relief Funds for Providers; Medicare Loans Coming Due

More Provider Relief Funds for Providers; Medicare Loans Coming Due

Money from the COVID-19 Provider Relief Fund, allocated for hospitals and other healthcare providers through the CARES Act and the Paycheck Protection Program and Health Care Enhancement Act, continues to be distributed, with the latest tranches going to hospitals and long-term care facilities in areas most impacted by COVID-19. While provider relief funds do not have to be repaid, providers who opted for Medicare Accelerated and Advance Payment loans do, and repayment is scheduled to begin August 1 unless Congress provides some relief.

Hospitals in High Impact Areas

During the week of July 20, the Department of Health and Human Services (HHS) began distributing $10 billion to hospitals in areas hardest hit by COVID-19. HHS guidelines specified that funds be “distributed to hospitals having over 161 COVID-19 admissions between January 1 and June 10, 2020,” or the equivalent of one admission per day. According to Fierce Healthcare, hospitals in Illinois, New York and Pennsylvania received the most funds, with distributions of $740 million, $683.6 million and $654.6 million, respectively.

This is the second allotment for high-impact hospitals. The first $12 billion was distributed back in May. Then in June, HHS asked hospitals to submit data on COVID-19 positive inpatient admissions between January and June in order to determine how the additional funds would be doled out.

Long-term Care Facilities in High Impact Areas

Last week, HHS also announced that $5 billion of the Provider Relief Fund will go to Medicare-certified long term care facilities and state veterans’ homes “to build nursing home skills and enhance nursing homes’ response to COVID-19, including enhanced infection control.” Specifically, facilities can use the funding for hiring additional staff, implementing infection control “mentorship” programs with subject matter experts, increasing testing, and providing additional services, such as technology so residents can connect with their families if they are not able to visit. 

This is the second time nursing homes have been on the receiving end of provider relief funds. Back in May, HHS distributed $4.9 billion to skilled nursing facilities to help offset revenue losses and assist nursing homes with additional costs related to responding to the COVID-19 public health emergency (PHE) and the shipments of personal protective equipment (PPE) provided to nursing homes by the Federal Emergency Management Agency (FEMA).

Along with news of the additional funds, the Centers for Medicare and Medicaid Services (CMS) also announced that all nursing homes in states with a 5 percent COVID-19 positivity rate or greater will be required to test all nursing home staff each week. While the exact specifications for receiving money from this recent tranche have not been announced, presumably some funds will go to nursing homes required to begin this increased testing regimen.

Medicare Loans Slated for Recoupment

Beginning August 1, Medicare will begin recouping loans provided to physicians and hospitals through the Accelerated and Advance Payment Program

Through the program, most providers and suppliers could request up to 100 percent of their Medicare payment amount for a three-month period. Inpatient acute care hospitals, children’s hospitals, and certain cancer hospitals were able to request up to 100 percent of the Medicare payment amount for a six-month period. Critical access hospitals (CAH) could request up to 125 percent of their payment amount for a six-month period.

The program began March 28, but was shuttered by CMS within a month because of the amount of money loaned out—around $100 billion in accelerated or advance payments were made to healthcare providers and suppliers. That includes the approval of over 21,000 applications totaling $59.6 billion in payments to Part A providers, and over 24,000 applications advancing $40.4 billion in payments for Part B providers and suppliers. 

Providers continued to submit claims as usual after the issuance of the accelerated or advance payment, and providers received full payments for their claims during a 120-day delay period. However, at the end of the 120-day period, which could be as early as August 1 for some providers, the recoupment process will begin, and every claim unpaid at that time or submitted afterwards will be used to repay the accelerated/advanced payment.

According to Healthcare Dive, the American Hospital Association and other groups representing the nation’s hospitals are “pushing for Congress to forgive the loans in its next round of COVID-19 relief legislation currently being negotiated on Capitol Hill, or enact looser repayment strictures like postponing the deadline, reducing the loans’ interest rates or reducing the per-claim recoupment amount from the entire claim to a fourth of it.”

And lawmakers seem to be listening. The new $1 trillion COVID-19 relief package, introduced by Senate Republicans this week, includes a repayment extension for hospitals. The Health, Economic Assistance, Liability Protection and Schools (HEALS) Act would allow providers to begin repaying their Accelerated and Advance Payment loans on Jan. 1, 2021, according to Alia Paavola of Beckers Hospital Review.

For more information about these Provider Relief Fund distributions or the Medicare Accelerated and Advance Payment Program, check out the following resources:

Also, for an updated look at how all the Provider Relief Funds are being distributed, we’ve updated the following graph with the most recent tranches.

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Charity Singleton Craig

Charity Singleton Craig is a freelance writer and editor who provides communications and marketing services for CIPROMS. She is responsible for creating, editing, and managing all content, design, and interaction on the company website and social media channels in order to promote CIPROMS as a thought leader in healthcare billing and management.

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