October 01, 2020
Funding Package to Prevent Government Shut Down Includes Relief for Physician Practices
Wednesday evening the Senate passed a continuing resolution (CR), a funding bill to avert a government shutdown. The CR, which President Trump signed into law the following morning, will extend $1.4 trillion in government funding until Dec. 11 and offers relief for physician practices.
The CR provides revisions to the Medicare Accelerated and Advance Payments program (AAP), which was initially created to provide relief for hospitals and providers in a COVID relief package, known as the CARES Act, passed and implemented in the spring. The CARES Act postponed the start of recoupment for the AAP until 120 days after initial payment and allows up to 210 days for repayment for physicians.
However, the repayment terms for the AAP also included penalties that required physicians to have 100 percent of their Medicare claims withheld to repay the loans on a short timeline, and after a few months any outstanding balances, would be subject to a 10.25 percent interest rate. ASA members and other physicians have expressed concern about the ability to repay this money while the pandemic is ongoing, and many practices are still facing economic challenges.
The Continuing Resolution:
- Postpones the recoupment of disbursed funds until 365 days after the advance payment has been issued to a physician practice.
- Reduces the per claim recoupment amount from 100 percent to 25 percent for the first 11 months and the 50 percent of claims withheld for an additional six months. If not repaid in full, the interest rate kicks in.
- Lowers the interest rate from 10.25 percent to 4 percent.
On October 1, the Department of Health and Human Services (HHS) announced a $20 billion Phase 3 General Distribution from the Provider Relief Fund (PRF) that is based on financial losses and changes in operating expenses caused by COVID-19. Providers who previously received General Distribution payments, as well as a new category of behavioral health providers and providers who began operating in 2020, are eligible to apply. Applications will be open October 5, 2020, through November 6, 2020, but HHS encourages providers to apply early.
ASA is pleased Congress has ensured that physicians will be able to continue providing care during the pandemic without this financial burden looming. We thank lawmakers for their commitment to protecting those on the frontlines and urge them to continue negotiations around additional economic relief for those impacted by COVID-19.