The U.S. Centers for Medicare and Medicaid Services (CMS) has announced new terms for repaying COVID-19 Medicare loans.
Repayment for loans issued under the agency's Accelerated and Advance Payment (AAP) program -- which allows CMS to make advance payments to healthcare providers in emergencies -- will now begin one year from the issue date of the loan. Original terms required providers to make payments in August of this year.
After the first year, Medicare will automatically garner 25% of reimbursements due to the provider or supplier for 11 months to settle any outstanding debt. At the end of this 11-month period, recoupment will increase to 50% for another six months. If the provider is unable to settle the debt by the end of this 29-month period, CMS will require immediate payment of the balance subject to an interest rate of 4%.
Providers may also request an Extended Repayment Schedule (ERS) which allows them to repay debts over three years.
CMS has issued $106 billion in payments to providers and suppliers during the COVID-19 pandemic, it said.
