CMS Issues Guidance on Sequestration Cuts

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Following the requirements of the Budget Control Act of 2011, the Centers for Medicare and Medicaid Services (CMS) will begin reducing all Medicare Fee for Service (FFS) program payments by 2 percent starting on April 1, unless Congress acts to halt the cuts.

In general, Medicare FFS claims with dates of service or dates of discharge on or after April 1, 2013, will be affected by the cuts.
CMS said the claims payment adjustment will be applied after determining coinsurance, any applicable deductible, and any applicable Medicare Secondary Payment adjustments. That should make the total reduction somewhat smaller than if the adjustment had been made on the total claim.

CMS has been backing the administration in urging Congress to act to avert the sequester cuts by passing legislation to undo the Budget Control Act of 2011. Perhaps hoping to get more Medicare beneficiaries calling their legislators to complain, CMS’s guidance also said that it “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.

If you have questions about reimbursement, CMS asks that you contact your Medicare claims administration contractor.

Access the CMS document here.