fah hospital policy blog

Perspectives on health policy affecting America’s hospitals and the patients we serve.

FAH, AMA Support Bicameral Fix to Medicare Accelerated and Advance Payment Programs

June 22, 2020 | FAH Policy Blog Team

Category: Legislation, Medicare

A recently introduced bicameral bill will fix a lifeline for health care providers before it becomes an anchor that sinks the recovery of hospitals.

The Medicare Accelerated and Advance Payments Improvement Act (S. 3750 / H.R. 6837) does exactly what the name says – it fixes the Medicare Accelerated and Advance Payment Programs (MAAPP). FAH supports this legislation, along with the American Medical Association, as it’s key to assuring Americans that their hospitals can continue providing COVID-19 and emergency care while safely re-opening for non-emergency procedures to recover from shutdowns driven by the crisis.

MAAPP loans are financial advances made on providers’ Medicare payments, and they  delivered vital funding to keep hospitals open and ensure access to patient care during the pandemic.

The problem is the terms of repayment. Despite still being in the middle of the fight to defeat COVID-19, starting on or about August 1, 2020, hospitals around the country will have their Medicare fee-for-service payments zeroed out until the borrowed funds are repaid. They also face steep interest rates – hovering around 10% – if the loans aren’t repaid within a year.

Recognizing that this will be a devastating blow to frontline heroes, Sens. Jeanne Shaheen (NH) and Michael Bennet (CO) and Reps. Brad Schneider (IL-10) and Ron Kind (WI-3) teamed up to introduce legislation to fix the flawed terms of the programs.

Remedies in the bill include:

  • delaying recoupment of the loans;
  • lowering the recoupment withheld from 100% of Medicare payments to 25%;
  • limiting the interest rate to 1%, with accrual beginning after two years;
  • utilizing general Treasury funds for the programs (rather than Medicare Trust Funds);
  • unfreezing disbursements; and,
  • authorizing loan forgiveness in cases of extreme hardship. 

We urge other members of both the House and Senate to join the efforts and co-sponsor this important legislation. We must act NOW! Every day of inaction creates more uncertainty for hospitals, our patients and our caregivers - jeopardizing our recovery and patient access to care.

Learn more about the MAAPP program and needed adjustments by clicking here.