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CMS Suspends the Advance Payment Program for Part B Suppliers

April 29, 2020

McDermott+Consulting

On April 26, the Centers for Medicare and Medicaid Services (CMS) announced that it is suspending its Advance Payment Program to Part B suppliers effective immediately. CMS will not be accepting any new applications for the Advance Payment Program and will be reevaluating all pending and new applications for Accelerated Payments in light of historical direct payments made available through the Department of Health and Human Service’s Provider Relief Fund.

The Advanced Payment Program is a loan program in which Part B providers received a prepayment of Medicare claims. This program was expanded during the public health emergency by the agency and its intent was to ensure that Part B providers and suppliers had the necessary cash flow during this period. CMS has indicated that in the light of the funds that are being released through the $175 billion Provider Relief Fund, the agency is re-evaluating the program.

CMS uses “accelerated” payments in reference to inpatient prospective payment system (IPPS) hospitals, children’s hospitals, cancer hospitals, and critical access hospitals (CAH) and “advanced” payments in reference to all other providers and suppliers.

Stakeholders have indicated concern about the program as it is a loan that must be paid back with a high interest rate attached and that some providers would not be in a position to pay back these loans by the time the balance is due. These providers would face a high interest rate (9.625%). For Part B suppliers, interest begins 210 days from disbursement.

Additional information about the program and the recent actions by CMS can be found on this factsheet. To keep up with agency information during the current public health emergency, visit the McDermottPlus Coronavirus Resource Center.

 

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For more information visit the McDermottPlus Payment Innovation Resource Center or contact Sheila Madhani at 202-204-1459/smadhani@mcdermottplus.com, Mara McDermott at 202-204-1462/mmcdermott@mcdermottplus.com or Rachel Stauffer at 202-204-1460/rstauffer@mcdermottplus.com.

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