Accelerated and Advance Payment (AAP) Program Change Updates

April 27, 2020

In the constantly evolving financial landscape, it's important for healthcare providers to understand funding adjustments that can impact their facilities, clinicians and patient communities. Amidst the COVID-19 response, this week CMS announced it will reevaluate pending and new payouts for the Accelerated Payment Program. Effective immediately, CMS is also suspending the Advance Payment Program to Medicare Part B suppliers, halting acceptance of any new applications. To help understand this, here's a breakdown:

What are Accelerated and Advance Payment (AAP) Programs?

AAP Programs are typically used toward emergency funding and cash flow for healthcare providers and suppliers when there is disruption or suspension of claims submission or claims processing, including during public health emergencies or federally declared disasters. Funds distributed from AAP Programs are not a grant, typically requiring payback within one year or less depending on the provider or supplier type. Those impacted by the Advance Payment Program Part B suspension include physicians, non-physician practitioners and durable medical equipment suppliers.

What is CMS' reasoning for the changes?

This announcement evolved as a response in light of the already distributed $100 billion in existing payments made to U.S. healthcare providers through these two programs on top of the $175 billion (comprised of $100 billion in the CARES Act and $75 billion through the Paycheck Protection Program and Health Care Enhancement Act) recently appropriated for provider relief. Initially, the AAP temporary loan programs worked to combat the beginning efforts against COVID-19, but additional federal funding stepped in. As much needed added layers of support, two phases from CARES Act provisions have been distributed from the Provider Relief Fund. Citing these "historical direct payments" made through the Provider Relief Fund, these AAP Program announcements have been made.

What is the industry response?

Across the country, clinicians are calling for an immediate return of the Medicare Advance Payment Program. Many who are struggling with noted slowdown in direct patient care visits are concerned that they haven't yet received or won't qualify for future CARES Act relief. The American College of Physicians calls stated, "To withdraw one of the ways that they can partially offset some of their revenue losses to keep the doors open is precisely the wrong direction for CMS to be going in." The American Academy of Family Physicians agreed, noting that small and independent clinical practices don't have the resources to handle CARES Act funding application complexity. The Advance Payment loan program was their lifeline. Still, an even greater concern is that no current funding to date will be substantial enough to help struggling healthcare practices and facilities stay afloat.

See the CMS updated fact sheet on the Accelerated and Advance Payment Programs here.

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