Major hospital groups are asking Congress to forgive $100 billion in Medicare accelerated and advance payment loans, according to CNBC.
CMS will start withholding new Medicare payments Aug. 1 until the loans, authorized by the Coronavirus Aid Relief and Economic Security Act, are repaid. If the loans are not repaid within one year, they will face a 10 percent interest charge, according to the report.
The American Hospital Association and Federation of American Hospitals have said that health systems can’t pay the loans back right now since many remain under financial pressure from the COVID-19 pandemic.
“Of all the financial issues that providers face regarding the federal assistance, this is the most critical … that could be crippling for hospitals in the midst of new COVID surges,” Federation of American Hospitals CEO Charles Kahn, told CNBC.
American Hospital Association CEO Rick Pollack also said the association is asking for forgiveness of the Medicare payments.
“It’s a mechanically easy way to provide instant relief to people on the ground,” Mr. Pollack told CNBC.
Both House and Senate relief aid bills have proposed restructuring the Medicare loans. For example, the House proposed giving hospitals more time to pay and cutting the interest rate to 1 percent. In addition, the Senate GOP proposal released July 27 calls for pushing the start date of the repayment to Jan. 1, 2021, and extending the overall time to pay back the loans.
Read the full report here.
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