Accelerated Payments from CMS Can Help Medicare Providers Stay Afloat, But Come with Potential Dangers

Advanced payments from the U.S. Centers for Medicare & Medicaid Services (CMS) can help home health agencies navigate cash flow challenges associated with the COVID-19 virus. But providers will need to approach accelerated payments with caution, armed with accurate, objective assessments of their internal financial situations.

During times of natural disasters, CMS normally offers expedited Medicare payments to help providers stay afloat. But the ongoing COVID-19 emergency has caused the agency to expand its accelerated and advanced payments program for Medicare providers, with more than $34 billion already distributed since the end of March.

“Amid a public health storm of unprecedented fury, these payments are helping providers and suppliers – so critical to defeating this terrible virus – stay afloat,” CMS Administrator Seema Verma said in a statement.


Within the first couple weeks of expanding its accelerated payment program, CMS received more than 25,000 advancement requests from providers, though it’s unknown how many came from home health care organizations.

Along with other relief measures, CMS’s expansion of the accelerated payments program addresses a host of bottom-line issues that could take place during the coronavirus crisis, Rob Simione, director of financial consulting at Simione Healthcare Consultants, told Home Health Care News.

“There are going to be potential delays in claim payments. There are going to be fluctuations in volumes of patients that are being taken care of, and there’s going to fluctuations in LUPA percentages,” he said. “Plus, the timing and ability to process claims are going to be slowed down because everyone is dealing with a remote workforce.”


Hamden, Connecticut-based Simione is a consulting firm that focuses on the home health care, hospice and palliative care spaces.

Cash-flow implications related to the COVID-19 virus are seemingly too many to list, but include payroll challenges and added supply expenses. Additionally, an overall decrease in elective procedures during the COVID-19 crisis will likely impact home health agencies’ revenues and cash flows as well.

“Health systems and hospitals are holding off any non-urgent matters, and elective procedures are being forgone right now,” Mark Sharp, a partner at BKD, said during a recent National Association for Home Care & Hospice (NAHC) webinar. “Think about all of the cases where we care for patients that just had a knee or a hip replacement. Those will be few and far between in this environment.”

BKD is a Springfield, Missouri-based accounting services firm.

Under the accelerated payments program, Medicare Part A and Part B providers can request payments by submitting a 30-day estimate of cash expected to be received from claims and cash that will be paid out to employees, among other operational expenses.

Once approved, Medicare will then determine an amount to provide to home health agencies based on the submitted information. The repayment period begins 120 days after the payment has been received.

“It’s pretty timely,” Simione said. “It seems the approval comes in about 24 to 48 hours. Agencies that I’ve seen apply for this in the first week have already gotten a response. This is key because some of these other things that are available, like loans, may have more of a delay.”

While CMS has received over 25,000 requests, it has approved more than 17,000. The agency signed off on just a fraction of that total in the previous five years.

Once accelerated payments are received, funds from the program will allow home health providers to take care of day-to-day expenses, such as bills and staff payroll. Funds could also be used to create a cushion for unforeseen care costs that will arise during the coronavirus emergency, according to Simione.

“Home health providers are going to be taking on different roles throughout this crisis, including taking on different patients from the hospitals and utilizing telehealth,” he said. “They need that influx of cash to be able to pay for those services and to be able to take on patients. Medicare is acknowledging what’s going on and that there’s going to have to be new ways of doing things.”

Specifically, most providers are incurring additional costs due to the ongoing personal protective equipment (PPE) shortage.

“The No. 1 issue right now is just getting PPE,” Sharp said during the NAHC webinar. “And because of the shortage, it’s probably coming in at a higher cost. We didn’t have that cost before.”

While CMS is ferociously approving requests for faster payments, not all providers can receive them. In particular, providers in bankruptcy or with outstanding delinquent Medicare overpayments are ineligible for the payments.

Additionally, providers that are under active medical review or program integrity investigation are not allowed to request payment.

While Simione believes that most providers should strongly consider applying for the payments, each company should perform a cash-flow analysis beforehand.

At the very least, the analysis should factor in shifting patient volumes and an increase in LUPAs, or Low Utilization Payment Adjustments, according to Simione.

“There’s going to be a change in volume,” he said. “Many agencies need to analyze what percentage of their business came from elective surgeries, which have mostly been postponed. They may get an uptick in COVID-19 patients, but the challenge is you’re not providing as many visits.”

Sunrise, Florida-based Interim HealthCare Inc. is among the home health organizations experiencing a decline in cases linked to elective procedures.

While there are not many downsides to pursuing accelerated payments, home health providers need to be prudent about repayment, according to Simione. Accelerated payments aren’t free money, but closer to loans.

“You have to be responsible,” he said. “It’s an advance payment, which means the payments will need to be paid back. CMS will start deducting what you own them out of your claims. You have to track the information and make sure you understand how much you’re going to owe.”

Healthcare Provider Solutions CEO Melinda A. Gaboury also urged providers to proceed with caution during a recent webinar.

“I’m concerned because agencies that allow themselves to receive an advance payment, especially at the maximum amount, they may run into a brick wall,” Gaboury said during the webinar. “[If CMS doesn’t] recoup the entire amount by day 210, you’re going to have to get with Medicare, with CMS and establish what the payback is going to be. You’re going to be subject to interest. The going interest rate … would be 10.25%, which nobody needs or can afford to do.”

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