Nelson Mullins Riley & Scarborough LLP

The Centers for Medicare & Medicaid Services (“CMS”) surprised stakeholders on Sunday, April 26, with an announcement that it would be reevaluating the amounts that will be paid under its Accelerated Payment Program and suspending all payments under the Advance Payment Program to Part B suppliers effective immediately. CMS previously expanded these Programs in response to the COVID-19 pandemic, resulting in over $100 billion in payments through the Accelerated and Advance Payment Programs. Since that expansion, Congress has appropriated a total of $175 billion for relief payments to health care providers to be disbursed at the discretion of HHS. While some of the $175 billion has already been paid to providers or has been otherwise earmarked for providers, a large remainder is still available for relief. 

The Accelerated and Advance Payment Programs were created to supply emergency funding to providers in need of cash flow assistance in response to a public health emergency or major natural disaster. The Programs provide assistance when such events cause disruption in claims submission and/or claims processing and provide a safety net during emergencies. CMS is authorized to make accelerated or advance payments during the period that a public health emergency is declared. Payments made under these Programs are not grants, they are loans. CMS announced the expansion of these Programs on March 28, 2020 in response to the COVID-19 pandemic. Since that date, CMS has approved over 21,000 applications resulting in almost $60 billion in payments to Part A providers and almost 24,000 applications resulting in $40 billion in payments to Part B providers. These monies will need to be repaid, typically through recoupment from future claims starting about 120 days from the payment, with the full amount due back to CMS within 1 year for inpatient acute care hospitals, children’s hospitals, certain cancer hospitals and Critical Access Hospitals and within 210 days for all other Part A providers and Part B suppliers. 

CMS has updated the Accelerated and Advance Payment Programs Fact Sheet, detailing more information about the Programs and confirming that, “beginning April 26, 2020 CMS will not be accepting any new applications for the Advance Payment Program, and CMS will be reevaluating all pending and new applications for Accelerated Payments in light of historical direct payments made available through HHS’s Provider Relief Fund.” 

CMS does not disclose how receipt of accelerated or advance payments might be viewed in conjunction with HHS’s Provider Relief Fund, and whether a provider’s future payments from the Provider Relief Fund may be affected in any way. As a reminder, providers do not need to pay back funds received from the Provider Relief Fund, assuming the provider meets all required Terms and Conditions.