General Surgery Coding Alert

Notice October AAP Extension

On Oct. 8, CMS announced it would alter the repayment terms to align with Congress’ recently passed Continuing Appropriations Act, 2021 and Other Extensions Act, giving providers more time.

“In the throes of an unprecedented pandemic, providers and suppliers on the frontlines needed a lifeline to help keep them afloat,” said CMS Administrator Seema Verma in a release on the change. “CMS’ advanced payments were loans given to providers and suppliers to avoid having to close their doors and potentially causing a disruption in service for seniors. While we are seeing patients return to hospitals and doctors providing care we are not yet back to normal.”

“These AAP Loans provided quick access to funds at [a] time when many … healthcare providers were facing an unexpected and unprecedented disruption in cash flow,” says attorney Jennifer Russano Koltse with law firm Chapman & Cutler in Chicago.

The new AAP update aligns with the act and allows the agency to:

• Delay disbursement recoupments to one year from the date the payment was issued
• Decrease the per claim repayment to 25 percent for the first 11 months; then, bump up recoupment to 50 percent for the next six months
• Cut the interest rate on the outstanding balances to 4 percent
• Give providers 29 months to pay the balance in full

Big news: “To allow even more flexibility in paying back the loans, the $175 billion issued in Provider Relief Funds can be used towards repayment of these Medicare loans,” CMS says in the release.

Pocket These 4 Steps to Prepare for AAP Recoupment

Medicare providers have won some breathing room on AAP repayment, but they can’t just ignore things until next spring. Heed this advice to stay on top of the matter:

1. Know your status: If you’re not sure exactly how much you have in COVID-related AAPs, you should find out. “CMS will be communicating with each provider and supplier in the coming weeks as to the repayment terms and amounts owed as applicable for any accelerated or advance payment issued,” the agency says in its release.
   If you don’t hear from CMS and its representatives, or if you have further questions about your AAP, “providers and suppliers should contact their MAC to receive current balance and payment information related to the repayment of their AAP payment,” CMS urges in its newly released Frequently Asked Question (FAQ) set on the topic.
2. Plan cash flow: Hopefully, the extra time before recoupment commences and the phased-in takebacks will allow you to repay what you owe, Macke notes. But you should start planning your cash flow now to be able to cover the recoupments that will start next spring, he advises.
3. Track payments: “Borrowers [should] establish a system to track their Medicare claims submitted, Medicare reimbursement received, and Medicare reimbursements recouped during the 29-month recoupment period in order to reconcile the payback process,” Russano Koltse suggests. You’ll also need to ensure that your billing system has a way to handle accepting these payments and then recording the recoupments.
4. Keep your options in mind: If you get to the end of the AAP recoupment process and find you can’t manage, you have one other course of action. As the 29-month process wraps up, “CMS will issue letters requiring repayment of any outstanding balance, subject to an interest rate of four percent,” the agency explains. “The letter also provides guidance on how to request an Extended Repayment Schedule (ERS) for providers and suppliers who are experiencing financial hardships.” If granted, an ERS can span up to three or even five years.

Remember: “A provider or supplier would need to meet specified criteria related to financial ‘hardship’ or ‘extreme hardship’ under 42 C.F.R. 401.607(c)(2) in order to be eligible for an ERS,” CMS reminds in its FAQ set.

Bottom line: Keep in mind this may not be the last word in how CMS will handle recoupment of AAPs, especially with the takebacks scheduled five to six months away.

CMS will also soon issue more information about the AAP loans. “Continuing the pattern of payment transparency adopted in connection with COVID-19 related federal funding, CMS is required to publish certain AAPP data on its website, including payment amounts broken down by borrower type and by Medicare certification number,” note attorneys Mark Cunningham, Doug Griswold, and Jed Roebuck with law firm Chambliss, Bahner & Stophel, P.C. in Chattanooga, Tennessee, in online analysis.

Resource: The four-page AAP repayment terms fact sheet is at www.cms.gov/files/document/accelerated-and-advanced-payments-fact-sheet.pdf.