Category Archives: Medicare Sequestration

The Summer of 2025 for U.S. Healthcare: What Organizations should Expect

Posted on by • Posted in 2026 Mid Term Election Issues, 2028 Election Issues, Budget Process, Chronic Care Management, Chronic Conditions, Chronic Diseases, Economic Indicators, Economic Outlook, Expectations, Health Policy, Healthcare Reform, Medicaid Cuts, Medicare Sequestration, Politics, Underinsured, Uninsured • Tagged , , • Leave a comment
The Summer of 2025 for U.S. Healthcare: What Organizations should Expect

Last Thursday, the Make America Healthy Again Commission released its 68-page report “Making America’s Children Healthy Again Assessment” featuring familiar themes—the inadequacy of attention to chronic disease by the health system, the “over-medicalization” of patient care vis a vis prescription medicines et al, the contamination of the food-supply by harmful ingredients, and more.

HHS Secretary Kennedy, EPA Administrator Zeldin and Agriculture Secretary Rollins pledged war on the corporate healthcare system ‘that has failed the public’ and an all-of-government approach to remedies for burgeoning chronic care needs.

Also Thursday, the House of Representatives passed its budget reconciliation bill by a vote of 215-214. The 1000-page bill cuts federal spending by $1.6 trillion (including $698 billion from Medicaid) and adds $2.3 trillion (CBO estimate/$3.4 to $5 trillion per Yale Budget Lab) to the national deficit over the next decade. It now goes to the Senate where changes to reduce federal spending to pre-pandemic level will be the focus.

With a 53-37 advantage and 22 of the 36 Senate seats facing mid-term election races in November, 2026, the Senate Republican version of the “Big Beautiful Bill” will include more spending cuts while pushing more responsibility to states for funding and additional cuts. The gap between the House and Senate versions will be wider than currently anticipated by House Republicans potentially derailing the White House promise of a final Big Beautiful Bill by July 4.

And, over the last week and holiday weekend, the President announced a new 25% tariff on Apple devices manufactured in India and new tariffs targeting the EU; threatened cuts to federal grants to Harvard and cessation of its non-citizen student enrollment, a ‘get-tougher’ policy on Russia to pressure an end of its Ukraine conflict, and a pledge to Americans on Memorial that it will double down on ‘peace thru strength’  in its Make America Great Again campaign.

These have 2 things in common:

1-They’re incomplete. None is a finished product.

The MAHA Commission, working with the Departments of Health & Human Services, Interior and Agriculture, is tasked to produce another report within 90 days to provide more details about a plan. The FY26 budgeting process is wrought with potholes—how to satisfy GOP deficit hawks vs. centrist lawmakers facing mid-term election, how to structure a bill that triggers sequestration cuts to Medicare (projected $490 billion/10 yrs. per CBO), how to quickly implement Medicaid work requirements and marketplace enrollment cuts that could leave insurance coverage for up to 14 million in limbo, and much more.  And the President’s propensity to “flood the zone” with headline-grabbing Truth Social tweets, Executive Orders and provocative rhetoric on matters at home and abroad will keep media occupied and healthcare spending in the spotlight.

2-They play to the MAGA core.

The MAGA core is primarily composed of older, white, Christian men driven by a belief that the United States has lost its exceptionalism through WOKE policies i.e. DEI in workplaces and government, open borders, globalization and excessive government spending and control. In the 2024 Presidential election, the MAGA core expanded incrementally among Black, Hispanic, and younger voters whose concerns about food, energy and housing prices prompted higher-than expected turnout. The MAGA core believes in meritocracy, nationalism, smaller government, lower taxes, local control and free-market policies that encourage private investment in the economy. The core is price sensitive.

The health system per se is not a concern but it’s the affordability and lack of price transparency are. They respect doctors and frontline caregivers but think executives are overpaid and prone to self-promotion. And the MAGA core think lawmakers have been complicit in the system’s lack of financial accountability largely beneficial to elites.

Looking ahead to the summer, a “Big Beautiful Bill” will pass with optics that allow supporters to claim fiscal constraint and lower national debt and opponents to decry insensitive spending cuts and class warfare against low-and-middle-class households.

Federal cuts to Medicaid and SNAP (Supplemental Nutrition Assistance Program) will be prominent targets in both groups—one a portrayal of waste, fraud and abuse and the other tangible evidence of societal inequity and lack of moral purpose. Each thinks the other void of a balanced perspective. Each thinks the health system is underperforming and in need of transformational change but agreement about how to get there unclear.

As MAHA promotes its agenda, Congress passes a budget and MAGA advances its anti-establishment agenda vis a vis DOGE et al, healthcare operators will be in limbo. The dust will settle somewhat this summer, but longer-term bets will be modified for most organizations as compliance risks change, state responsibilities expand, capital markets react and Campaign 2026 unfolds.

And in most households, concern about the affordability of medical care will elevate as federal and state funding cuts force higher out of pocket costs on consumers and demand for lower prices.

The summer will be busy for everyone in healthcare.

PS: Changes in the housing market are significant for healthcare: 36% of the CPI is based on shelter vs. 8% for medical services & products, 14% for food and 6% for energy/transportation. While the overall CPI increased 2.3% in the last 12 months, medical services prices increased 3.1%. contributing to heightened price sensitivity and delayed payments.

It has not escaped lawmaker attention: revenue cycle management business practices (debt collection) are being scrutinized in hospitals and community benefit declarations by not-for-profit hospitals re-evaluated. The economics of healthcare are not immune to broader market trends nor is spending for healthcare in households protected from day-to-day fluctuations in prices for other goods and services.

Congress isn’t done with messy health care fights

Posted on by • Posted in Ambulance, American Hospital Association (AHA), American Medical Association (AMA), Health Policy, Health System, Hospital, Hospital Industry, Inflation Reduction Act, Medicare, Medicare Sequestration • Leave a comment

https://www.axios.com/2022/08/17/congress-isnt-done-with-messy-health-care-fights

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The Inflation Reduction Act is law. But that doesn’t mean major health care interests are done testing their lobbying clout. Many are already lining up for year-end relief from Medicare payment cuts, regulatory changes and inflation woes.

The big picture: Year-end spending bills often contain health care “extenders” that delay cuts to hospitals that treat the poorest patients or keep money flowing to community health centers. But lawmakers may be hard-pressed to justify the price tag this time, and are seeing an unusual assortment of appeals for help.

Background: 2% Medicare sequester cuts that had been paused by the pandemic took effect last month. Another 4% cut could come at year’s end, if lawmakers don’t delay it.

  • These automatic reductions in spending come amid health labor force shortages, supply chain problems and other pressures that are making providers jockey for relief.
  • It will fall to Congress to pick winners and losers among hospitals, physicians, home health care groups, nursing homes and ambulance services. And each says the consequences of not helping are dire.
  • “The core question is how do they come up with the money and how do they decide to prioritize who give it to?” said Raymond James analyst Chris Meekins.

Go deeper: Hospitals are pressing hard for relief from the year-end sequester, and want Congress to extend or make permanent programs that support rural facilities and are slated to expire on Sept. 30, absent legislative action.

  • The American Hospital Association has estimated its members will lose at least $3 billion by year’s end.
  • Hospitals in the government’s discount drug program also have to be made whole after the Supreme Court unanimously overturned a huge pay cut stemming from a 2018 rule. And the industry also is seeking to reverse a planned cuts to supplementary payments for uncompensated care.

Doctors and nursing homes are among the other players lining up for relief from sequester cuts, specific Medicare payment changes that affect their businesses or new regulations.

  • The American Medical Association says Medicare cuts could threaten physician practices that have been racked by pandemic-induced retirements and burnout. “This is really about allowing patients and Medicare beneficiaries to continue care,” AMA President Jack Resneck told Axios.
  • National Association for Home Care and Hospice President Bill Dombi said over half of the home health agencies will run deficits if lawmakers don’t act. “When you have that many providers in the red, you can foresee there will be negative consequences. They’re already rejecting 20 to 30% of referrals for admissions to care, so it will be affecting patients,” said Dombi.
  • Ambulance services are also struggling. “Ambulance providers around the country are at a very near breaking point as we kind of walk along the ledge leading to this cliff at the end of the calendar year,” Shawn Baird, president of the American Ambulance Association and chief operating officer of Metro West Ambulance in Oregon, told Axios.

The other side: Despite Congress’ willingness to delay payment cuts, there’s not enough money to make everyone happy. And concerns about Medicare program’s solvency that emerged during the lengthy debate over the Democrats’ tax, climate and health package could dampen lawmakers’ enthusiasm for costly fixes that favor one provider group.

  • The continuation of the COVID-19 public health emergency and its myriad temporary payment allowances could also lessen a sense of urgency around provider relief.

The bottom line: For all the dire warnings, it’s unlikely Congress will do much until December, when it will likely pass a continuing resolution or an omnibus spending bill and could then move to delay the 4% cut.

CMS Releases 2023 MPFS Proposed Rule

Posted on by • Posted in Alternative Payment Model, Center for Medicare and Medicaid Services (CMS), Conversion Factor, Hospital Based Physicians, Medicare, Medicare Cuts, Medicare Sequestration, MIPS Value Pathways (MVPs), Physician, Physician Reimbursement, Quality Payment Program (QPP), Relative Value Units (RVU), Telemedicine Reimbursement • Leave a comment

Click to access 72f59ed7-692d-4f32-a3a8-da32d65c2ac7.pdf

On July 7, 2022, the Centers for Medicare & Medicaid Services (CMS) released the 2023 Medicare Physician Fee Schedule (MPFS) proposed rule, which includes payment provisions and policy changes to the Quality Payment Program (QPP) and Alternative Payment Model (APM) participation options and requirements for 2023.

MPFS Key Proposals and Additional Potential Medicare Reductions:

For 2023, CMS proposes a Conversion Factor (CF) of $33.0775 which is a decrease of $1.53 or -4.42% from the 2022 conversion factor of 34.6062.

  • This significant reduction in the CF accounts for the expiration of the 3.00% increase in PFS payments for CY 2022 as required by the Protecting Medicare and American Farmers from Sequester Cuts Act, in addition to the statutorily required budget neutrality adjustment to account for changes in Relative Value Units.
  • The separately calculated Anesthesia CF is proposed at 20.7191, a -3.91% decrease from the 2022 conversion factor of $21.5623.

Key Takeaways:
CMS estimates an impact to allowed charges from policy changes in the rule as outlined below. These impacts are due in part due changes in the RVUs and the second year of the transition to clinical labor pricing updates.


(Please note: These estimates do not include the impact on payments from the expiration of the congressionally mandated 3.00% boost to the 2022 CF.)

  • Anesthesiology: -1%
  • Diagnostic Radiology: -3%
  • Interventional Radiology: -4%
  • Emergency Medicine: +1%
  • Critical Care: +1%
  • Nuclear Medicine: -3%
  • Pathology: -1%
  • Radiation Oncology/Therapy Centers: -1%
  • Internal Medicine: +3%
  • Independent Laboratory -1%

Additional Potential Medicare Reductions:

  • In addition to the proposed cut to the CF, the second of two sequestration cuts was implemented on July 1, 2022, at -1%, bringing the total sequestration cut to -2% which will continue without Congressional intervention. 
  • Also, the lack of full funding of the American Rescue Plan meant that the Medicare program would contribute 4% under the “PAYGO” (Pay as You Go) rules and that cut will come back into the Medicare fee schedule in 2023. In total, hospital-based physicians face in the approximate range of -10% in 2023 without Congressional intervention.  

Appropriate Use Criteria (AUC):
CMS did not address the appropriate use criteria (AUC)/clinical decision support (CDS) mandate for
advanced diagnostic imaging services in this rule. CMS posted an update on its website indicating that
the current educational and operations testing period will continue beyond January 1, 2023, even if the
COVID-19 public health emergency (PHE) ends in 2022. The notice states that the agency is unable to
forecast when the payment penalty phase of the program will begin. Read more at CMS.gov.


Additional highlights of the MPFS Proposed Rule include:
Evaluations and Management (E/M) Services:
As part of the ongoing updates to E/M visits and the related coding guidelines that are intended to
reduce administrative burden, the AMA CPT Editorial Panel approved revised coding and updated
guidelines for Other E/M visits, effective January 1, 2023.


Like the approach CMS finalized in the CY 2021 MPFS final rule for office/outpatient E/M visit coding and
documentation, CMS is proposing to adopt most changes in coding and documentation for Other E/M
visits including: hospital inpatient, hospital observation, emergency department, nursing facility, home
or residence services, and cognitive impairment assessment, effective January 1, 2023. This revised
coding and documentation framework would include CPT code definition changes (revisions to the
Other E/M code descriptors), and for the first time would mean that AMA CPT and CMS would follow
the same coding guidelines, including:


• New descriptor times (where relevant).
• Revised interpretive guidelines for levels of medical decision making.
• Choice of medical decision making or time to select code level (except for services such as
emergency department visits (time has never been a component of ED E/M services except
critical care) and cognitive impairment assessment, which are not timed services).
• Eliminated use of history and exam to determine code level (instead there would be a
requirement for a medically appropriate history and exam).


Split (or Shared) Visits (Where services are performed by advance practice clinicians.)
CMS had previously finalized in the 2022 MPFS final rule a new January 1, 2023 billing policy for
instances in which a physician delivers an E/M service along with an advanced practice clinician (APC).
Recall that E/M services billed under an APC reimburse at 85% of the MPFS unless there is a
documented shared service by the supervising physician.

• The key determinant for deciding if there was a shared service is if the physician provided key
elements of the history, exam, or medical decision making ─ OR half of the total time spent
treating the patient.
• There were significant concerns that in hospital-based settings, the rule (set for implementation
on January 1, 2023) would have required only time as the determinative element, and that the
majority of APC services would then be reimbursed at 85% of the fee schedule. After significant
advocacy by multiple stakeholders, CMS has delayed the policy that would have based the
determination of the billing practitioner solely on time. This policy is proposed for delay until
January 1, 2024 while CMS collects additional input.


Expand Telehealth Coverage:
• CMS is proposing making several services that are temporarily available as telehealth services
for the PHE available through CY 2023 on a Category III basis, which will allow more time for
collection of data that could support their eventual inclusion as permanent additions to the
Medicare telehealth services list.
• CMS is also proposing to extend the duration of time that services are temporarily included on
the telehealth services list during the PHE, but are not included on a Category I, II, or III basis for
a period of 151 days following the end of the PHE, in alignment with the Consolidated
Appropriations Act, 2022 (CAA, 2022).


Highlights of the Quality Payment Program (QPP):
CMS stated they are limiting proposals for traditional MIPS and focusing on further refining
implementation of MIPS Value Pathways (MVPs).
2023 Proposed Performance Threshold and Performance Category Weights:
The performance threshold for the 2023 performance year is proposed to be 75 points, same as 2022.
• Beginning with 2023, CMS will no longer offer an exceptional performance adjustment.
• The category weights for the 2023 performance year are proposed to remain the same as the
2022 weights:
o Quality – 30%,
o Cost – 30%
o Promoting interoperability – 25%
o Improvement Activities – 15%


Data Completeness Requirements:
• For 2023, CMS is proposing quality measure submissions should continue to account for at least
70% of total exam volume – same as 2022.

• CMS proposed to increase this threshold to 75% beginning with the 2024 and 2025 performance
years.


Quality Category – Measure Scoring System
• Beginning with 2023 CMS will change the scoring range for benchmarked measures to 1 to 10
points, doing away with the 3-point floor.
• Score existing non-benchmarked measures at 0 points even if data completeness is met
• New measures will continue to be scored at a minimum of 7 points for their first year and a
minimum of 5 points in their second year.
• CMS is maintaining the small practice bonus of 6 points that is included in the Quality
• performance category score.
• CMS also continues to award small practices 3 points for submitted quality measures that do not
meet case minimum requirements or do not have a benchmark.


MIPS Value Pathways (MVPs)
CMS is proposing 5 new MVPs and revising the 7 previously established MVPs that would be available
beginning with the 2023 performance year.
• Advancing Cancer Care
• Optimal Care for Kidney Health
• Optimal Care for Patients with Episodic Neurological Conditions
• Supportive Care for Neurodegenerative Conditions
• Promoting Wellness


Advanced Alternative Payment Models
For payment years 2019 through 2024, Qualifying APM Participants (QPs) receive a 5 percent APM
Incentive Payment. After performance year 2022, which correlates with payment year 2024, there is no
further statutory authority for a 5 percent APM Incentive Payment for eligible clinicians who become
QPs for a year.


CMS is concerned that the statutory incentive structure under the QPP beginning in the 2023
performance year. corresponding 2025 payment year, could lead to a drop in Advanced APM
participation, and a corresponding increase in MIPS participation. As a result, CMS concluded that it
would forego action for the 2023 performance period and 2025 payment year. They instead are seeking
public input in identifying potential options for the 2024 performance period and 2026 payment year of
the QPP.

House extends moratorium on 2% Medicare sequester cuts through 2021

Posted on by • Posted in Center for Medicare and Medicaid Services (CMS), Health Policy, Health System, Hospital, Hospital Industry, Medicare, Medicare Cuts, Medicare Sequestration, Rural Health, Rural Health Clinics (RHC), Rural Hospital • Leave a comment

https://www.healthcarefinancenews.com/news/house-extends-moratorium-2-medicare-sequester-cuts-through-2021

APR 14MORE ON REIMBURSEMENT

House extends moratorium on 2% Medicare sequester cuts through 2021

President Biden is expected to sign the bill into law.

Susan Morse, Managing Editor

(Photo courtesy joe daniel price/Getty Images)

In a vote of 384-38, the House on Tuesday passed a bill that eliminates the 2% cut to Medicare payments until the end of 2021. However, the bill proposes to offset the change by increasing the sequester cuts in 2030.

WHY THIS MATTERS

The cuts were triggered by a federal budget sequestration.

Hospitals, physicians and other providers protested the 2% cuts as coming at a time when they were struggling financially and clinically to handle the COVID-19 pandemic.

The bill also makes several technical changes to the rural health clinic provisions that were included in the Consolidated Appropriations Act. Specifically, the CAA required that the payment rate for RHCs, including provider-based RHCs certified after Dec. 31, 2019, to be capped at $100 per visit, starting from April 1, 2021. 

This rate will increase over time based on the Medicare Economic Index, but will remain well below typical provider-based RHC rates. The bill would correct the Dec. 31, 2019, date to Dec. 31, 2020, and include both Medicare-enrolled RHCs located in a hospital with less than 50 beds and RHCs that have submitted an application for Medicare enrollment as of this date, according to the AHA.

THE LARGER TREND

Last year, Congress paused the 2% Medicare cuts, but they were to resume on April 1.

The Centers for Medicare and Medicaid Services instructed Medicare administrative contractors to hold all claims with dates of service on or after April 1 for a short period until potential legislation was enacted.

In March, the House passed the bill to delay the cuts, and the Senate approved it later that month, but with an amendment to delay through December 31 and ensure that the cost of the delay is paid for. 

PROVIDER REACTION

Providers have reacted positively to the news.

American Hospital Association president and CEO Rick Pollack said, “Even though our country is making great progress by vaccinating millions of people a day, it is clear that this pandemic is far from over and that there is an urgent need to keep hospitals, health systems and our heroic caregivers strong.”

American Medical Association president Dr. Susan R. Bailey said, “The Senate and House, Democrats and Republicans, have overwhelmingly acknowledged that cutting Medicare payments during a pandemic is ill-conceived policy. Physician practices are already distressed, and arbitrary 2% across-the-board Medicare cuts would have been devastating.”

America’s Essential Hospitals SVP of policy and advocacy Beth Feldpush said, “Extending the moratorium through the end of this year provides much-needed relief for essential hospitals, which continue to face heavy financial pressure from their frontline response to COVID-19. The sequester would weaken the ability of our hospitals to care for the communities of color that have suffered disproportionately from the pandemic.”

Senate votes to delay sequester cuts to Medicare payment

Posted on by • Posted in Cost Management, Health Policy, Health System, Hospital, Hospital Industry, Medicare, Medicare Payment, Medicare Sequestration, PAYGO (Pay-as-you-go) Act • Leave a comment

https://mailchi.mp/3e9af44fcab8/the-weekly-gist-march-26-2021?e=d1e747d2d8

Democrats ran and won on health care. Now what? - CNN Politics

If you’re looking for an issue that can unite a heavily divided Congress, it seems nearly all Senators can get behind delaying payment cuts to providers during a pandemic. On Thursday the Senate voted 90-2 to pause the 2 percent sequester cuts to Medicare payment slated to go into effect on April 1.

The bill is expected to be passed by the House and signed into law by President Biden, delaying the cuts through the coronavirus public emergency. While hospitals, many of whom are still recovering from increased costs and volume loss during the pandemic, can breathe a sigh of relief, providers face an even larger 4 percent payment cut in the fall due to the PAYGO, or “pay as you go”, statute, which would trigger automatic payments cuts due to the deficit increases caused by the COVID relief bill. 

We’d gamble that intense industry lobbying to delay the PAYGO cuts will prove successful—again, legislators will be reticent to dock provider payment as pandemic recovery continues. But eventually, in a more normal world, hospitals can expect policymakers to shift their focus from pandemic relief to cost control—and it will likely not prove possible to delay the inevitable reckoning over the high cost of our health system.

Congress Urged to Stop Pending Medicare Payment Cuts

Posted on by • Posted in American Medical Association (AMA), American Rescue Plan (ARP) Act of 2021, Association of American Medical Colleges, Association of American Medical Colleges (AAMC), Health Policy, Health System, Hospital, Hospital Industry, Medical Group Management Association (MGMA), Medicare, Medicare Cuts, Medicare Sequestration, PAYGO (Pay-as-you-go) Act, Physician • Leave a comment
https://www.medpagetoday.com/publichealthpolicy/medicare/91657?xid=fb_o&trw=no&fbclid=IwAR35SCMPaH830EiFznbZVZkV03Zd7KKejxw2T3U9DZjWZS8KX3UbKJHGIHA

— At stake: scheduled payment reductions totalling $54 billion

Healthcare groups are applauding efforts being made in Congress to stop two different cuts to the Medicare budget — both of which are due to “sequestration” requirements — before it’s too late.

One cut, part of the normal budget process, is a 2% — or $18 billion — cut in the projected Medicare budget under a process known as “sequestration.” Sequestration allows for prespecified cuts in projected agency budget increases if Congress can’t agree on their own cuts. Medicare’s budget had been slated for a 2% sequester cut in fiscal year 2020; however, due to the pandemic and the accompanying increased healthcare needs, Congress passed a moratorium on the 2% cut. That moratorium is set to expire on April 1.

Another projected cut — this one for 4%, or $36 billion — will be triggered by the COVID relief bill, formally known as the American Rescue Plan Act. That legislation, which President Biden signed into law last Thursday, must conform to the PAYGO (pay-as-you-go) Act, which requires that any legislation that has a cost to it that is not otherwise offset must be offset by sequestration-style budget cuts to mandatory programs, including Medicare.

There are now several bills in Congress to address these pending cuts. H.R. 1868, co-sponsored by House Budget Committee chairman John Yarmuth (D-Ky.), House Ways & Means Committee chairman Richard Neal (D-Mass.), and House Energy & Commerce Committee chairman Frank Pallone Jr. (D-N.J.), among others, would get rid of the PAYGO Act requirement and extend the 2% Medicare sequester moratorium through the end of 2021.

Another bill, H.R. 315, introduced in January by Reps. Bradley Schneider (D-Ill.) and David McKinley (R-W.Va.), would extend the 2% sequester moratorium until the end of the public health emergency has been declared. In the Senate, S. 748, introduced Monday by senators Susan Collins (R-Maine) and Jeanne Shaheen (D-N.H.) would do the same.

“For many providers, the looming Medicare payment cuts would pose a further threat to their ability to stay afloat and serve communities during a time when they are most needed,” Shaheen said in a press release. “Congress should be doing everything in its power to prevent these cuts from taking effect during these challenging times, which is why I’m introducing this bipartisan legislation with Senator Collins. I urge the Senate to act at once to protect our health care providers and ensure they can continue their work on the frontlines of COVID-19.”

Not surprisingly, provider groups were happy about the actions in Congress. “MGMA [Medical Group Management Association] supports recent bipartisan, bicameral efforts to extend the 2% Medicare sequester moratorium for the duration of the COVID-19 public health emergency,” said Anders Gilberg, senior vice president for government affairs at MGMA, in a statement. “Without congressional action, the country’s medical groups will face a combined 6% sequester cut — a payment cut that is unsustainable given the financial hardships due to COVID-19 and keeping up with the cost of inflation.”

Leonard Marquez, senior director of government relations and legislative advocacy at the Association of American Medical Colleges, said in a statement that it was “critical” that Congress extend the 2% sequester moratorium “to help ensure hospitals, faculty physicians, and all providers have the necessary financial resources to continue providing quality care to COVID-19 and all patients ... While we are making progress against COVID-19, cutting provider payments in the middle of a pandemic could jeopardize the nation’s recovery.”

The American Medical Association (AMA) also urged Congress to prevent both the 2% and the 4% Medicare cuts. “We strongly oppose these arbitrary across-the-board Medicare cuts, and the predictably devastating impact they would have on many already distressed physician practices,” AMA executive vice president and CEO James Madara, MD, said in a letter sent to congressional leaders at the beginning of March.

In the letter, Madara noted that an AMA report, “Changes in Medicare Physician Spending During the COVID-19 Pandemic,” analyzed Medicare physician claims data and found spending dropped as much as 57% below expected pre-pandemic levels in April 2020.

“And, while Medicare spending on physician services partially recovered from the April low, it was still 12% less than expected by the end of June 2020,” he continued. “During the first half of 2020, the cumulative estimated reduction in Medicare physician spending associated with the pandemic was $9.4 billion (19%). Results from an earlier AMA-commissioned survey of 3,500 practicing physicians conducted from mid-July through August 2020 found that 81% of respondents were still experiencing lower revenue than before the pandemic.”

Not everyone is a fan of extending the 2% cut moratorium, however. “Bad idea,” said James Capretta, resident fellow at the American Enterprise Institute, a right-leaning think tank, at an event Tuesday on Medicare solvency sponsored by the Bipartisan Policy Center. “There’s plenty of give in the revenue streams of these systems that creating a precedent where we’re going to go back to the pre-sequester level — it’s better to move forward and if there are struggling systems out there, deal with it on an ad hoc basis rather than just across the board paying out a lot more money, which I don’t think is necessary.” He added, however, that he agreed with the bill to get rid of the 4% cut. “The bigger cut associated with PAYGO enforcement I think would be too much.”

Medical groups implore Congress to extend moratorium on sequester cuts as COVID-19 ramps up

Posted on by • Posted in America's Health Insurance Plans (AHIP), American Medical Association (AMA), Economic Crisis, Economic Recovery, Economic Stimulus, Federation of American Hospitals, Health System, Hospital, Hospital Industry, Medicare, Medicare Sequestration, Pandemic, The CARES Act • Leave a comment
https://www.fiercehealthcare.com/hospitals/medical-groups-implore-congress-to-extend-moratorium-sequester-cuts-as-covid-19-ramps-up?mkt_tok=eyJpIjoiWlRSaU9HRTBNVGd3Wm1FMSIsInQiOiJiNkR4SVFuM1wvclpGbVRoZE9QUkhidzNUXC9ocG96cld1K0trNldhWHhLVWNMXC9nQjZUS29ZRW5RVUFVdnFaWmJcLzJlY1wvdG9nczdNNU5qNnRLM0ZyNWFVWEFFQ3lxejZSVjlJV2h0eGVISlJ4bkZnRmVVR2hMVCs5MDNHTDhGQUM0In0%3D&mrkid=959610
Congress building

A collection of provider and payer groups are imploring Congress to continue a moratorium on Medicare payment cuts instituted under the sequester.

The letter (PDF), sent Friday by more than 20 groups to congressional leaders, is concerned that the moratorium installed under the CARES Act expires on Jan. 1. The groups want the moratorium to extend through the COVID-19 public health emergency, which has been renewed by the federal government several times.

The groups said that the moratorium needs to be extended as healthcare facilities are under massive financial stress with new surges of COVID-19.

The surge has impacted the “financial health of medical professionals and facilities, including increased cost of labor to ensure adequate staffing, procurement of personal protective equipment, significant reductions in patient volume resulting from orders to cancel non-emergent procedures and the high cost of caring for COVID patients,” the letter said.

Some of the groups signing on to the letter include the American Medical Association, America’s Health Insurance Plans, Federation of American Hospitals and American College of Physicians.

The groups said that the moratorium on the sequester cuts installed as part of the CARES Act was an acknowledgment from Congress over the important role that Medicare reimbursement plays in “the financial well being of our healthcare system.”

The sequestration cut Medicare payments by 2% across the board to all Medicare providers back in 2013.

The letter comes as Congress is pondering another relief package for COVID-19 during the lame-duck period. Senate Majority Leader Mitch McConnell said after the presidential election that he was open to restarting talks on a new relief package and added that hospitals will need some additional relief.

But McConnell said earlier this week that the same issues that have held up a deal with House Speaker Nancy Pelosi are still there.

“I don’t think the current situation demands a multi-trillion dollar package,” McConnell told reporters. “I think it should be highly targeted.”

But Pelosi has endorsed a larger package. The House passed the HEROES Act, a $3 trillion relief bill, several months ago.

What health care is getting out of the stimulus package

Posted on by • Posted in COBRA Coverage, Coronavirus, Crisis, Crisis Management, Economic Stimulus, Health Insurance Coverage Adequacy, Health Insurance Industry, Health Policy, Health System, Hospital, Hospital Industry, Laboratory Industry, Medicare, Medicare Sequestration, Out of Pocket Expenses, Out-of-Network, Surprise Bills, Underinsured, Uninsured • Leave a comment

https://www.axios.com/health-care-hospitals-coronavirus-stimulus-package-c49bd0cc-05a0-479a-a83d-d4455bd0e7bd.html?utm_source=newsletter&utm_medium=email&utm_campaign=newsletter_axiosvitals&stream=top

Senate passes $2 Trillion coronavirus economic stimulus plan, it ...

Congress’ big stimulus package will provide more than $100 billion and several favorable payment policies to hospitals, doctors and others in the health care system as they grapple with the coronavirus outbreak.

The big picture: Hospitals, including those that treat a lot of rural and low-income patients, are getting the bailout they asked for — and then some.

The cornerstone provision is a no-strings-attached $100 billion fund for hospitals and other providers so they “continue to receive the support they need for COVID-19 related expenses and lost revenue,” according to a summary of the legislation.

  • It’s unclear how that money would be divvied up. One lobbyist speculated the funds would go to the “hardest-hit areas first and those areas that are next expected to get hit,” but that has not been clarified.

The bill provides many other incentives for the industry.

  • Hospitals that treat Medicare patients for COVID-19 will get a 20% payment increase for all services provided. That means Medicare’s payment for these types of hospital stays could go from $10,000 to $12,000, depending on the severity of the illness.
  • Employers and health insurers will be required to pay hospitals and labs whatever their charges are for COVID-19 tests if a contract is not in place. By comparison, Medicare pays $51.33 for a commercial coronavirus test.
  • Medicare’s “sequestration,” which cuts payments to providers by 2%, will be lifted until the end of this year.
  • Labs won’t face any scheduled Medicare cuts in 2021, and won delays in future payment cuts as well.

What’s missing: Patients who are hospitalized with COVID-19 could still be saddled with large, surprise bills for out-of-network care.

  • There also are no subsidies for COBRA coverage, which employers wanted for people who lost their jobs. However, people who are laid off are able to sign up for a health plan on the Affordable Care Act’s marketplaces or could qualify for Medicaid.