On March 28, 2020, the Centers for Medicare & Medicaid Services (CMS) expanded the Medicare Accelerated and Advance Payment Program (AAP), making the program available for most Medicare physicians and group practices. The AAP provided loans to applicants facing financial disruption due to COVID-19 based on historic Medicare billing. Repayment of AAP loans begins one year from the date the payment was issued, which means repayment could begin as early as next month. Group practices that accepted AAP loans should note the following repayment options:
- Automatic claims recoupment (default mechanism): Starting one year from loan disbursement, Medicare Administrative Contractors (MACs) will recoup outstanding AAP loans by automatically reducing Medicare payments owed to the provider by 25% for 11 months (e.g., a claims withhold). Following the initial 11-month repayment period, if the loan has not been repaid in full, Medicare payments will be recouped at 50% for another six months. Thereafter, any remaining balance must be paid within 30 days or it will accrue interest at a rate of 4% until repaid in full (there is no interest assessed on loans repaid before this time).
- Repayment in lump sum amounts: Providers may repay AAP loans by making a lump sum payment or payments to their MAC. Group practices interested in this repayment option should consult with their MAC for details, including any forms that should accompany repayments.
CMS has not provided further details on the repayment process, such as when exactly claims recoupment will begin.