Temporary Claims Hold Pending Congressional Action to Extend 2% Sequester Reduction Suspension
In the Centers for Medicare and Medicaid Services (CMS) ongoing effort to maintain budget neutrality, providers have traditionally seen an automatic sequestration of 2% in Medicare payments since implemented by the Budget Control Act of 2011. The Act set the 2% automatic and uniform reduction of Medicare payment cuts for a period of nine years. However, as a result of the COVID-19 pandemic, the payment cuts were temporarily suspended but were expected to be applied again starting April 1, 2021.
A new agreement reached by the Senate proposed a further delay in the reinstatement of the 2% sequestration for an additional nine months through December 31, 2021. It is now on the House of Representatives to approve and pass the Senate’s legislation. However, due to Easter recess, the House will not vote on the legislation until mid-April, they are back in session for voting April 13, 2021. Since the 2% sequestration is to go back into effect April 1, CMS announced they expect the House to vote favorably on the legislation and will therefore hold off on processing April’s claims until the time the House votes in an effort to avoid making reduced payments.
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