Early in the pandemic, the Centers for Medicare and Medicaid Services (CMS) offered Medicare providers loans, based on past Medicare billing, to help struggling practices with necessary cash flow. CMS reported it made AAP loans totaling $8.5 billion to physicians and other Part B providers. Loan repayment begins one year from the date the payment was issued, meaning some repayments could begin as early as next month. If you accepted the AAP loan, review the following repayment options:
- Automatic claims recoupment (default): Beginning one year after the payment was issued, Medicare Administrative Contractors (MACs) will begin the recoupment process. 25% of new Medicare payments owed to the provider will be withheld for 11 months. If the loan is not paid within the 11-month period, Medicare will withhold 50% for the next 6 months. Any remaining balance must be paid within 30 days. After 30 days, the loan will accrue interest at 4% until it is paid in full (no interest is charged before this time).
- Lump sum repayment: Providers may pay the loan in full or large payment sums. If you are interested in this option, contact your MAC for details and any required forms.
If a physician is experiencing financial or other hardships, they may qualify for an extended payment schedule. Physicians can contact their MAC to request a hardship extension and to find out the current balance of their AAP loan.
If you have questions, contact your MAC and/or read the loan repayment fact sheet for more information. The Advocacy Council will monitor this issue and provide updates as they become available. The Advocacy Council – we have you covered.