Sequestration FAQ for California Physicians March 11, 2013 Advocacy, News, Physician Resource 2% Medicare cut, sequester cuts, sequestration 0 The $85.4 billion 2013 sequester includes a 2% cut (or $10 billion) in Medicare provider payments. Below are answers to frequently asked questions about the sequestration cuts. When do the cuts take effect? All cuts were triggered on March 1, but most cuts will not happen until April 1. Physicians who see Medicare patients will see a 2% reduction in their payments beginning April 1. What Medicare cuts can physicians expect? Per CMS, the Medicare fee-for-service program (Part A and Part B) claims with dates-of-service or dates-of-discharge on or after April 1, 2013, will be reduced by 2%. Claims for durable medical equipment (DME), prosthetics, orthotics, and supplies, including claims under the DME Competitive Bidding Program, will also be reduced by 2% for claims with dates-of-service 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 2% payment reduction, Medicare’s payment to beneficiaries for unassigned claims is subject to the 2% reduction. CMS encourages Medicare physicians who bill claims on an unassigned basis to discuss with beneficiaries the impact of sequestration on Medicare’s reimbursement. The sequestration cuts are 2% across the board for all Medicare fee-for-service claims. It also affects physicians contracting with Medicare Advantage plans. Medicare Advantage plan payments will also be cut by 2%. Certain details of the Medicare sequester still have not been made public. For example, we do not yet know how the Medicare Advantage plans will pass down the payment cuts to contracting or employed physicians. How do I bill Medicare after March 1, 2013? Physicians should continue billing as usual until more guidance has been provided by the Centers for Medicare and Medicaid Services. Will Medicare EHR incentive payments be cut? While CMS has released no specific information on how it will handle the sequestration cuts, there is a possibility that providers may see a 2% cut to their EHR “meaningful use” incentive payments. This money had been set aside under the 2009 federal economic stimulus package for both Medicare and Medicaid, so it is unclear whether it will be impacted by the sequestration cuts. Medicaid is exempt from the sequester. What programs are exempt from the sequestration? Medicaid, Social Security and the Veteran’s Administration are exempt from the cuts. How will the cuts impact health care in California? The White House issued a report showing that California would be impacted by the following cuts: Medicare, public health, childhood vaccinations, mental health, AIDs and HIV treatment and prevention. Vaccines for Children: Reduced funding for the federal Vaccines for Children program means that approximately 15,810 fewer children in California will qualify for free vaccines for diseases such as measles, mumps, rubella, tetanus, whooping cough, influenza and Hepatitis B. Public Health: California will lose approximately $2.6 million in funds to respond to public health threats including infectious diseases, natural disasters and biological, chemical, nuclear, and radiological events. In addition, California will lose about $12.4 million in grants to help prevent and treat substance abuse, resulting in around 9,400 fewer admissions to substance abuse programs. California will also lose $2 million for AIDS treatment and HIV prevention. Medicare: All Medicare physician services and Medicare Advantage plans will be cut by 2%. Graduate Medical Education and all other programs within Medicare will be negatively impacted as well. Click here for the White House summary of the impact of the 2013 sequestration on California. What can I do to help stop these cuts? It is not too late for physicians to contact Congress to explain the impact that a 2% Medicare payment cut will have on physicians and their patients. Given that most of the cuts won’t actually be implemented until April 1, it is possible that Congress will eventually come to an agreement and reverse some of the sequestration cuts. Contact your U.S. representative and senators today; send them an email and call their offices through AMA’s grassroots hotline at (800) 833- 6354. Enter your zip code and you will be automatically connected to your representatives. Your patients can help, too, by contacting Congress through the AMA’s Patients’ Action Network hotline at (888) 434-6200. Comments are closed.
