CMS Revises Repayment Terms for Advanced Payment Program – Repayments Will Now Begin After One Year

Last Updated: Mar 11, 2021

The Centers for Medicare and Medicaid Services (CMS) has revised the repayment terms of its Advanced Payment Program (APP). Previously, repayment was set to begin 120 days after the advance payment was issued to the provider. Repayments will now begin one year after the advance payment was issued to the provider, which could be as early as April 2021.  

Here’s what you need to know:

  • After the first year, Medicare will automatically recoup 25 percent of Medicare payments for 11 months. After this 11-month period, the recoupment will increase to 50 percent for another six months. Then, after that six-month period, CMS will issue letters requiring the repayment of any outstanding balances, which will be subject to a 4 percent interest rate.

  • During the repayment period, every claim submitted to Medicare could be offset by as much as 100 percent to repay the advanced payment.

  • Loans not repaid within 210 days of loan disbursement were subject to interest rates of up to 10.25 percent. Instead of repaying APP loans via claims recoupment, providers may choose to repay loans via lump sum payments.

Members who have questions can contact PAMED’s Knowledge Center at 800-228-7823 or KnowledgeCenter@pamedsoc.org.

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