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COVID-19 Accelerated & Advance Payment (CAAP) Repayment Terms – April Update

Last updated Apr 12 2021
Jurisdictions:

In October 2020, CMS announced revised repayment terms for payments issued to providers and suppliers in response the Coronavirus Aid, Relief and Economic Security (CARES) Act. Based on the amended terms, CMS delayed recoupment until one year after the CAAP was issued. The amended repayment process also includes the following:

  • After the first year, the automatic recoupment of 25% of the providers/suppliers Medicare payments will be implemented for the first 11 months. As specified by Congress in the Continuing Appropriations Act, 2021 and Other Extensions Act, the recoupment percentage will not be deferred or reduced.
  • At the end of the 11-month period, the recoupment percentage will automatically increase from 25% to 50% and remain in effect for an additional 6 months.
  • If the CAAP loan is not fully recovered within 29 months (includes the 12-month delay and the 17-month automatic recoupment period), a demand letter will be issued.
  • Once the demand letter is issued, the remaining balance is considered an overpayment and will be subject to a 4% interest rate along with all normal recovery activities.
  • The demand letter will provide guidance on how to request an extended repayment schedule (ERS) for those providers and suppliers who are experiencing financial hardship. Please note, the loan is not eligible for an ERS until after the demand letter is issued.

All recoupments will be displayed on the provider’s remittance advice with the associated AR transaction number that will begin with ‘CVD’ as indicated below:

  • For Part A, non-PIP providers, the recoupments will be reported with a PLB code of ‘WO’ (Withholding Offset) and the FCN field will contain the AR transaction number associated with the accelerated payment.
  • For Part A, PIP providers, recoupments will be reported with a PLB code of ‘WS’ (Settlement Offset Cross Reference) or ‘AS’ (Settlement Offset TIN based Relationship Netting) and the FCN field will contain the AR transaction number that is associated with the accelerated payment.
  • For Part B providers, the CAAP offset will be reported with a PLB code of ‘WO’ (XREF and TIN based Relationship Netting) and the FCN field will include the AR transaction number associated with the advance payment.

For more information, see “Accelerated and Advance Payment Repayment & Recovery Frequently Asked QuestionsPDF Icon on the CMS website. Also, please submit inquiries relating to CAAP to AccAdvPymtReq@wpsic.com.