In April, ISMA joined the AMA in a letter asking Congress to extend repayment terms for loans provided through the Medicare Accelerated and Advance Payment Programs (MAAPP). Now, combined with the tax on Provider Relief Fund grants, congressional inaction could undermine Indiana hospitals and other providers just as they are preparing for a possible resurgence of COVID-19. ISMA needs your help NOW to prevent this.

It is essential that Washington address the following issues before the October recess.

• Loan repayment deadlines. Currently, hospitals and providers must begin repaying MAAPP loans within 120 days of receiving funds, which for many means any day now. These hospitals have only 12 months – and other providers have only 270 days – to fully repay these loans before a 10% interest rate begins to accrue. But hospitals, doctors, dentists and other health care professionals are still fighting COVID-19. Congress must update these deadlines to 12 months to begin repayment (starting no earlier than April 2021) and 36 months to complete repayment, or they risk putting our entire health care system in jeopardy.

• Medicare payments. Under existing MAAPP loan repayment terms, hospitals and providers will not receive Medicare fee-for-service payments from the date they begin repayment until the loans are fully repaid. This eliminates an average of 25% of hospitals’ total payments – even more for some, such as rural providers that typically treat a larger proportion of Medicare patients. Congress must reduce the amount of recoupment taken from each Medicare claim from 100% to 25%.

• High interest rates. If MAAPP loan recipients do not complete repayment in the given time frame, their loans will begin accruing interest at an exceedingly high rate of 10%. This is far higher than rates that Congress provided for many other industries. Congress should waive this interest or, at the very least, limit the rate to 1% or less.

• Government funding resolution. The U.S. House of Representatives took a critical first step yesterday (Sept. 22) by including adjustments to the MAAPP loan program in the government funding resolution. Now, it is time for the Senate to act by passing a similar resolution before the October recess. 

• Provider Relief Fund tax. Separately, Congress provided $175 billion for hospitals and providers to cover COVID-19 related expenses and revenue losses through the Provider Relief Fund. However, these grants are subject to taxation, meaning that tax-paying hospitals and providers must pay taxes on the funds they received through PRF; this is equal to approximately 21% or more of the emergency funds they received. Congress should also address this issue and lift the tax on grants provided through the Provider Relief Fund.

Email your senators today!

On behalf of Hoosier patients and the physicians they depend on, contact Sen. Todd Young and Sen. Mike Braun at the addresses below to urge them to implement these changes before the October recess!

Sen. Todd Young: E-mail Jaymi Light, health care policy director 
Jaymi_light@senate.young.gov
 
Sen. Mike Braun: E-mail Reily Inman, legislative aide, health issues
reily_inman@braun.senate.gov