CMS Expands Accelerated and Advance Payment (AAP) Program

The Centers for Medicare & Medicaid (CMS) announced it would alter the Accelerated and Advance Payment (AAP) program’s repayment terms. The new repayment updates are as follows:

  • Delay disbursement recoupments to one year from the date the 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.
  • Providers or suppliers have 29 months to repay the balance in full.
    • Provider or supplier unable to repay the total amount of the AAP during this time period (a total of 29 months) are subject to an interest rate of four percent (4%) on any outstanding balance.

Although breathing room was given to providers, an action plan should be crafted now instead of later. Below are four essential tips when preparing for the AAP recoupment.

Know your status
  • Double-check and verify how much you have in COVID-19 related AAPs. CMS will be communicating with each provider and supplier about repayment terms and amounts owed as applicable; it is essential to know your current loan amounts and ask appropriate questions.
  • If you do not hear from CMS and its representatives or have further questions about your AAP, providers, and suppliers should contact their MAC to receive current outstanding balance and payment information related to their APP Payment repayment.
Plan cash flow
  • CMS hopes the additional time before recoupment commences and the phased-in takebacks will allow providers to repay what has been advanced. It is essential to have a plan B though; you should start planning your cash flow now to ensure your practice is able to cover the recoupments that will start next spring.
Track payments
  • A system should be established to track Medicare claims submitted, Medicare reimbursement received, and Medicare recoupments during the 29-month recoupment period in order to accurately reconcile the payback process.
Keep your options in mind.
  • As you continue through the AAP recoupment process, if you find yourself not managing the repayments, explore the alternative action, extended repayment schedule (ERS). The ERS can extend payments up to five years for providers with continued financial hardships. ERS applications will be accepted at the end of the initial 29-month repayment period and will include a CMS letter with appropriate guidance.
Key Reminder:

When evaluating your current finances, it is vital to ensure appropriate performance of your current billing operations as they are responsible for your cash flow. If you believe your revenue cycle management needs to be improved, AdvantEdge Healthcare Solution would welcome the opportunity to discuss how we can help.

Source: CMS