Medicare Fee Cuts to Hit Physicians, April 2
CMS notified its Medicare Administrative Contractors (MACs) today (Friday, March 8) that the failure of Congress to act on sequestration will result in a two percent fee cut to Medicare providers, effective April 1, 2013. In general, Medicare Fee for Service claims, with dates-of-service or dates-of-discharge on or after that date will incur a two percent reducation in Medicare payment. Claims for durable medical equipment (DME), prosthetics, orthotics, and supplies, including claims under the DME Competitive Bidding Program, will be reduced by two percent based upon whether the date-of-service, or the start date for rental equipment or multi-day supplies, is on or after April 1, 2013. The claims payment adjustment will be applied to all claims after determining coinsurance, any applicable deductible, and any applicable Medicare Secondary Payment adjustments. Though beneficiary payments for deductibles and coinsurance are not subject to the two percent payment reduction, Medicare’s payment to beneficiaries for unassigned claims is subject to the two percent reduction. The Centers for Medicare & Medicaid Services encourages Medicare physicians, practitioners, and suppliers who bill claims on an unassigned basis to discuss with beneficiaries the impact of sequestration on Medicare’s reimbursement. The Budget Control Act of 2011 requires, among other things, mandatory across-the-board reductions in Federal spending, also known as sequestration. The American Taxpayer Relief Act of 2012postponed sequestration for 2 months. As required by law, President Obama issued a sequestration order on March 1, 2013. The Administration continues to urge Congress to take prompt action to address the current budget uncertainty and the economic hardships imposed by sequestration. How will physicians be affected? Medicare payments to providers (physicians, hospitals, Medicare Advantage plans, Part D prescription drug plans, etc.) will be cut by two percent per fiscal year. Exempted federal programs which will not be subject to payment cuts include:
What other areas of healthcare will be impacted? Other areas of healthcare will also face reductions under sequestration, including important graduate medical education (GME) funding, and drastic cuts of up to ten percent to the Centers for Disease Control and Prevention’s (CDC) vaccine and disease prevention efforts, the National Institutes of Health (NIH) and its research programs, and the Food and Drug Administration (FDA) food inspection and pharmaceutical safety efforts. CMS has some discretion on how it will implement the two percent provider cuts, and has not yet commented on how exactly it will do so, but actual payment reductions to physicians are not expected to begin until April 1. The AOA has sent numerous letters under the signature of President Stowers to Members of Congress regarding the negative impact of sequestration. In addition, the AOA has joined with numerous other physician organizations and state affiliates in delivering a similar unified message to Congress. The AOA legislative team has also conducted meetings with Members of Congress, leadership offices, and key congressional committees to discuss the issue and implore action to avert sequestration. We will continue these efforts to urge Congress to reach an agreement on deficit reduction and reverse the sequester and its impact on physician payment and other critical areas of healthcare. What is the reaction of AACOM? The American Association of Colleges of Osteopathic Medicine (AACOM) President and CEO, Stephen C. Shannon, DO, MPH, today issued the following statement on the implementation of the across-the-board sequestration cuts, which will ultimately result in reduced patient access to care and increased health care costs for vulnerable populations. The Budget Control Act of 2011 increased the debt ceiling and set forth provisions to decrease the nation's deficit including the creation of the Joint Committee on Deficit Reduction. The 2011 bipartisan committee then failed to meet its charge of reducing the deficit by at minimum $1.2 trillion. As a result, sequestration requiring $1.2 trillion in budgetary adjustments over 10 years was triggered to begin on January 2, 2013, divided evenly between defense and non-defense programs, impacting both discretionary and mandatory spending, including Medicare. In the final hours of January 1, 2013, Congress approved the “American Taxpayer Relief Act (ATRA)” (HR 8) delaying sequestration and its accompanying 2 percent payment cut by 60 days to March 1.
|