Senate Vote Would Reverse PFS Sequester Cut . . . Temporarily

With a vote of 90-2, the U.S. Senate approved ASCP-supported legislation to extend the pause on a 2 percent cut in Medicare payment rates. The cuts, known as the sequester cut, would be postponed through the remainder of 2021 under the bill. The measure now has to go back to the House of Representatives which is expected to vote on the measure, HR 1868, when it returns from recess on April 13. The House had previously passed the measure, but the bill was amended in the Senate before its approval there.

Unfortunately, the current pause on the sequester ended April 1, so Medicare payments issued after that date will be cut by two percent. However, in anticipation of Congress’s plans to extend the pause on the sequester cut, the Centers for Medicare and Medicaid (CMS) has instructed its Medicare Administrative Contractors (MACs) to hold all claims with dates of service on or after April 1, 2021, for a short period without affecting providers’ cash flow. This is intended to minimize the volume of claims the MACs must reprocess if Congress extends the suspension. CMS has stated that the MACs will automatically reprocess any claims paid with the reduction applied if necessary. 

Extending the pause in the Medicare sequester removes one of two major overall threats to Medicare payments. The other threat concerns a provision of law knows as the Pay-As-You-Go Act of 2010 (PAYGO), which triggers across the board cuts when federal spending increases the deficit. Because of the cost of the recently passed American Rescue Plan Act, a four-percent reduction is expected to go into effect around September 1. To avert these cuts, ASCP is urging  Congress to pass legislation overriding the cuts.