Verma: CMS Holding Off on Medicare Loan Recoupment, Keeping Tabs on Congress

Home health providers that have been waiting for the Medicare advance and accelerated loan repayment process to begin will have to wait a little bit longer.

While the U.S. Centers for Medicare & Medicaid Services (CMS) has yet to release an official statement, Administrator Seema Verma has confirmed the agency will hold off on the loan recoupment process while Congressional negotiations on repayment terms are taking place.

“You know, that’s something that we’re looking at,” Verma said during a recent interview with Modern Healthcare. “[It’s] something that Congress is also grappling with. I will say that we understand that COVID has had a significant impact and what we’re seeing in the numbers is that services are starting to come back up.”

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In an effort to aid providers amid the COVID-19 emergency, CMS originally expanded the Medicare advance and accelerated payment program in March. In April, when funds were made available through the CARES Act provider relief grants, CMS suspended the program for Medicare Part B providers and said it would reevaluate pending applications from Part A providers.

The recoupment process for providers who received loan payments should have begun in August. Instead, providers — with no guidance from CMS — were left confused about how to proceed with repaying their loans.

Hospital groups and other health care providers have called on the government to waive repayment altogether.

“We’re looking at different options at this point, but we want to do everything we can to support providers on the front lines,” Verma told Modern Healthcare.

As Congress looks into the issue, the news that CMS is evaluating when to begin the recoupment process will come as a relief to some providers, Aaron Little, managing director at BKD, told Home Health Care News.

“It is indeed anxiety-inducing thinking that your Medicare payments could start to be 100% withheld any day,” Little said in an email. “It would help providers even more to see a formal statement issued by CMS, to let providers know through an official communication that the recoupments are being delayed and by what period time.”

BKD is a Springfield, Missouri-based accounting services firm that provides billing and revenue cycle outsourcing services.

Washington, D.C.-based aging services advocacy organization LeadingAge likewise supports the delay. Many providers are still facing financial challenges related to the public health emergency, so any relief is much appreciated, according to LeadingAge officials.

“The financial impact of the coronavirus pandemic on aging services providers is huge,” Katie Smith Sloan, president and CEO of LeadingAge, told HHCN in an email. “Our members’ financial situation is still unpredictable, and in some cases, precarious; having more time before recoupment is critical for our members offering home health, nursing home and hospice services.”

From March through May, CMS disbursed more than $100 billion in accelerated payments, with 2% of funds — or about $1.7 billion — going to home health providers, according to federal data.

Verma’s confirmation of the loan repayment delay will have both a positive and negative impact on the home health industry, according to Beth Prince, vice president of revenue management services at Corridor.

Overland Park, Kansas-based Corridor is a company that helps home-based care providers with revenue cycle challenges and other aspects of doing business.

“This means that providers will not have the financial impact in the immediate time frame we are in, as previously planned, which may be great for some providers,” Prince told HHCN in an email. “However, the delay creates another period of anticipating and planning for repayment for our providers and agencies, except that there is not as much concrete information to plan future steps on, in my opinion.”

Overall, most industry insiders agree that providers will likely still be on the hook to repay the loans at some point.

As far as impact, providers who don’t have a strong financial plan may be at risk.

“I think most providers always anticipated repayment in some fashion in the future,” Prince said. “The future impact of the repayment for our industry can be significant or minor, depending on the strength of the financial strategy the agency embraced at the high point of the COVID-19 impact.”

For now, Prince believes providers should continue to stay informed, monitor payer reimbursement behavior and implement a full reconciliation process before repayment officially begins.

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