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Agreement to Postpone Medicare Cuts—Effects on Providers

Headlines in Friday's major news publications reported "Senate Passes Plan to Stop Medicare Pay Cuts" and "Senate Fails to Spare Doctors from Medicare Cuts," and both headlines were correct.

On Friday, June 18, the Senate adopted a measure to stall the 21% price cut and add a 2.2% increase for another six months or through the end of November.  However, the House had adjourned for the weekend not to resume until Monday, June 21.

Soon after the Senate announced its agreement to postpone the cut, the Centers for Medicare & Medicaid announced the following:

The Continuing Extension Act of 2010, enacted on April 15, 2010, extended the zero percent update to the 2010 Medicare Physician Fee Schedule (MPFS) through May 31, 2010. 

On May 27, 2010, the Centers for Medicare & Medicaid Services (CMS) initially instructed contractors to hold claims for services paid under the MPFS for the first 10 business days of June.  On June 14, CMS extended this hold for an additional three business days (i.e., through June 17, 2010).  This hold only affected MPFS claims with dates of service of June 1, 2010 and later.

CMS today directed contractors to lift the hold and begin processing June 1 and later MPFS claims under the law's negative update requirement.  Held claims will be released and processed on a flow basis, first-in/first-out.

...If Congress changes the negative update currently in effect, CMS is prepared to act expeditiously to make the appropriate changes to Medicare claims processing systems.

What does this mean to providers?  Claims submitted with a date of service
June 1 or later and being held for payment by CMS will be released and paid according to the fee schedule reflecting the 21% cut.  Once the House approves the Senate bill then those claims may be resubmitted for the remaining part of the payment.

For more information regarding this legislation contact HORNE Manager Sharon Walden at sharon.walden@horne-llp.com or 225.755.9798.