It is big news everywhere, so we can get away with a simple summary. The Change Healthcare cyberattack bricked one of healthcare’s primary pathways for electronic data exchange.

The inability to submit is creating serious cash flow pressure for suppliers in the three weeks since. Unfortunately, we do not expect the short-term funding options currently offered by Medicare or UnitedHealth Group, Change Healthcare’s parent company, to provide much relief.

Next Episode: Thursday, August 22, 2024

Temporary Funding Assistance Program via Optum Pay

Optum Pay, like Change Healthcare, is a division of UnitedHealth Group (collectively, the “Group”). Fairly soon after disclosing the cyberattack, the Group offered a short-term financing product through its payment services arm Optum Pay. You can read all about it here.

Given the obvious conflict of interest – and the very ambiguous terms reported by MiraVista clients – we recommend suppliers approach this offering with a high degree of skepticism.

Medicare Advance Payments to Part B Suppliers

On March 9, 2024, CMS opened the door for making accelerated payments to Part A providers and advance payments to Part B suppliers. According to CMS’s Accelerated and Advance Payments protocol:

“An advance is a conditional partial payment for services rendered and must be used for Provider operations in the ordinary course of business. It must be repaid timely when the qualifying payment or billing issues have been resolved. An accelerated payment must also be repaid within 90 days or it becomes a delinquent Medicare overpayment subject to recoupment, interest charges, and referral to Treasury.”

Contrary to popular belief, it is not a 90-day, interest-free loan. Medicare immediately offsets 100 percent of payments made after any advance.

Many suppliers will remember a version of this protocol initiated during the COVID-19 Public Health Emergency in 2020. This deployment is a bit different, and CMS posted a fact sheet for the Change Healthcare disruption.

While the application is relatively straight forward, we are not convinced most suppliers will benefit.

Medicare Payment Disruption Required?

According to the fact sheet, suppliers must certify:

“The provider/supplier is not able to submit claims to receive claims payments from Medicare [emphasis added].”

While all suppliers certainly feel the crunch of the outage, many do not submit their Medicare fee-for-service claims through Change. Those that transmit their claims through unaffected clearinghouses or through Medicare’s own Common Electronic Data Interchange (CEDI) will probably not be able to certify the above statement.

Brightree, for example, submits Medicare claims through CEDI, so the Change outage did not impact their users’ ability to submit claims to Medicare.

The fact sheet also states that suppliers must certify:

“The provider/supplier has experienced a disruption in claims payment or submission due to a business relationship the provider/supplier, or the provider’s/supplier’s third-party payers [emphasis added], has with Change Healthcare or another entity that uses Change Healthcare or requires the provider/supplier to use Change Healthcare.”

At first blush, this additional certification may seem like an exception to the first. Medicare, however, requires suppliers to certify both statements. That means the second certification doesn’t matter if suppliers’ actual Medicare payments haven’t been materially disrupted.

The actual application form makes this distinction more clearly:

“Cash balance is seriously impaired due to (select one):

  1. Abnormal delay in Title XVIII claims processing and/or payment by the health insurance contractor.
  2. Delay in provider billing process of an isolated temporary nature beyond the provider’s normal billing cycle and not attributable to third party payers or private patients [emphasis added].”

Some mistake this as a flexibility where Medicare will make advance payments based on any payment disruption caused by Change Healthcare. In fact, it only captures disruptions to Medicare payments caused by entities other than the DME MACs. If anything, it doubles down on restricting the purpose and use of the CMS-affiliated accelerated payment program to cash flow disruptions directly attributable to Medicare payments.

Anticipated Receipts

The Accelerated and Advance Payments protocol lists the following condition for supplier eligibility:

“The provider’s impaired cash position would not be alleviated by receipts anticipated within 30 days which would enable the provider to meet current financial obligations …”

As of today, Brightree has 141 payers ported to Inovalon, its alternate clearinghouse relationship.

We understand NikoHealth has redirected substantial portions of its claim volume through Availity.

Many suppliers are already transmitting claims through payer portals for Medicaid and commercial insurance payers.

While this is a big mess, many suppliers are finally getting claims out the door. To the extent those claims process normally, it is less likely suppliers will meet this last condition.

The collective response to the Change attack gives us hope that the whole thing will be a cliched punchline by the time we arrive at Medtrade in Dallas, TX later this month. If that is the case, these two funding options won’t provide short-term relief to suppliers who responded aggressively.