Skip to content
Find a Provider
The National Council logo

SGR Deadline Passes, Medicare Processing Will Stall Payment Cuts

Capitol Connector
Your source for the latest updates from Capitol Hill. We translate policy into practice so you can learn how policy trends will affect your work and how best to prepare.

Michael Petruzzelli

, National Council for Behavioral Health

SGR Deadline Passes, Medicare Processing Will Stall Payment Cuts

April 2, 2015 | Medicare | Comments
Share on LinkedIn

Although the Medicare “doc fix” deadline has come and gone without legislative action by the Senate, the Centers for Medicare and Medicaid Services (CMS) ensured providers it will do all it can to prevent the 21% payment cuts from taking effect. In a release yesterday, CMS acknowledged its efforts to limit the impact on providers and beneficiaries by holding claims for a short period of time beginning on April 1st.

Last Thursday, the House overwhelmingly passed Medicare physician payment reform legislation, voting 392-37 in favor of the bill to repeal the outdated formula which mandates ever-increasing physicians pay cuts each year. However, after approving its budget resolution at 3am on Friday morning, the Senate punted a vote on the Medicare measure until after its two-recess. The legislation – the Medicare Access and CHIP Reauthorization Act of 2015 – would repeal the current Sustainable Growth Rate (SGR) formula and replace it with one that links reimbursement in part to the quality of care provided. The bill would provide set payment updates over the next five years, incorporate incentives for alternative payment models, and extend funding for the Children’s Health Insurance Program (CHIP) through 2017.

The SGR formula has become a perennial headache on Capitol Hill, requiring yearly action to temporarily stave off major cuts to Medicare providers. After months of negotiations, Speaker of the House John Boehner (R-OH) and Minority Leader Nancy Pelosi (D-CA) were able to broker a bipartisan deal that would finally end the headache.

CMS recently reminded providers that it has 14 days to reimbursement payments claimed electronically (29 days for paper claims). This two week window will allow CMS to hold off any payment cuts until absolutely necessary. It is important to note that Congress has never allowed scheduled payment cuts to take effect and that Senate action on the reform law is expected as soon as the chamber reconvenes in two weeks.