President Trump signed a bill Thursday morning to keep the federal government in office until December 11. This “continuing resolution” (CR), which was approved by the Senate on Wednesday on an 84-10 vote, according to The New York Times, includes provisions to delay physician repayment of pandemic-related Medicare loans and to reduce loan interest rates.
In an earlier press release, the American Medical Association (AMA) reported that Congress and the White House had agreed to include the Medicare loan provisions in the CR.
As part of the Medicare Accelerated and Advance Payments (AAP) program, the Centers for Medicare & Medicaid Services (CMS) advanced money to doctors who have been financially affected by the pandemic. The program, created in March, was suspended at the end of April.
Doctors who received Medicare loans were supposed to start paying them back 120 days after they were granted. CMS planned to recover the advances by offsetting them with the health insurance claim payments owed to the doctors. Firms had up to 210 days (7 months) to repay loans through this process before being asked to repay them directly with 10.25% interest.
For the firms that received these advances, that meant their Medicare cash flow was expected to dry up starting in August. However, CMS quietly refrained from collecting these payments when they fell due, according to Modern health care.
New conditions
Under the new loan repayment conditions in the RC, the recovery of disbursed funds is postponed to 365 days after the date on which a practice received the money. The balance is due by September 2022.
The amount to be recovered on each claim is reduced from 100% to 25% of the claim for the first 11 months and to 50% of the claims retained for an additional 6 months. If the loan is not repaid in full by then, the provider must pay the balance with 4% interest.
Over 80% of the $ 100 billion CMS loaned to healthcare providers through May 2 has gone to hospitals, Modern healthcare calculated. Moreover, specialized or multispecialized practices received $ 3.5 billion, internal medicine specialists received $ 24 million, family physicians received a loan of $ 15 million and health centers approved by the federal government received $ 20 million.
In the AMA press release, AMA President Susan Bailey, MD, who took office in June, called the original loan repayment plan “an economic sword hanging over medical offices. “.
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