When the U.S. Senate passed a bipartisan funding bill last week to avoid a possible government shutdown, it officially restructured and relaxed the repayment terms on Medicare loans taken out by home health providers in the spring.
President Donald Trump signed the funding bill on Wednesday just two days before he was flown to Walter Reed Hospital for health reasons related to COVID-19.
The ongoing resolution will be funded by the government until December 11th. Regarding Medicare loans, new deadlines are being put in place for home health providers, qualified nursing homes (SNFs), and others to repay any upfront payments and expedited payments received in 2020.
“This makes real rental accommodation,” said Judy Waltz, a partner at Milwaukee, Wisconsin-based law firm Foley & Lardner LLP. previously told Home Health Care News.
Prepayments and expedited payments, monitored by the U.S. Centers for Medicare & Medicaid Services (CMS), are designed to keep Medicare-reimbursed health organizations alive during turbulent times. Since the beginning of the COVID-19 emergency, CMS has disbursed more than $ 100 billion in such loans.
Overall, home health providers previously received $ 1.7 billion in loans CMS has suspended the advance payment and accelerated the payment programs In late April. Short-term hospitals received comparatively more than $ 78 billion.
“Medicare Accelerated and Prepayments have been a lifeline for many hospitals and healthcare systems in the battle against this historic pandemic, enabling them to continue providing the care their patients and communities depend on,” said Rick Pollack, President and CEO of American Hospital Association in a statement.
Under normal circumstances, Medicare providers should begin paying back their loans on August 1 – or run the risk of CMS withhold reimbursement of unpaid debts. However, August came and went without CMS garnishing any payments.
Back then, CMS Seema Verma proposed The agency expected Congress to address the issue directly.
The recently finalized finance bill now provides hospitals with a year before Medicare can claim their loan repayment payments. Other Medicare providers have up to 210 days.
Providers have 29 months to fully repay the loan from the initial payment. Previously, they were only one year below the original deadline. In addition, the measure lowers the interest rate on outstanding payments from 10.25% to 4%.
Industry representatives and trade associations have tried to fully award expedited payments, but that was never really an option, as Waltz noted earlier.
“Medicare cannot just access more money or do anything Congress does to pay the federal debt,” she said. “It’s very specific to the trust fund, so the idea of forgiveness wasn’t realistic.”