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Medicare 2% payment increase to take effect on May 1

April 15, 2020
Area(s) of Interest: Payor Issues and Reimbursement 


The Coronavirus Aid, Relief, and Economic Security (CARES) Act temporarily suspends the -2% sequestration payment adjustment on Medicare fee-for-service payment. This means that physicians will see a 2% payment increase on Medicare claims effective May 1, 2020. The increase is effective for claims with dates of service from May 1, 2020, through December 31, 2020.

Since the passage of Sequestration Transparency Act of 2012, Medicare payments have been subject to a 2% sequestration reduction. These cuts are the result of a congressional deal to address the debt ceiling crisis.

The suspension of this sequestration cut is a welcome action, and one for which the California Medical Association (CMA) has been advocating. CMA is also urging Congress to suspend the Medicare MACRA payment freeze, and instead replace it with a meaningful payment update.

Since the COVID-19 crisis began, CMA has been aggressively lobbying federal and state leaders to ensure physician practices can stay afloat amid the COVID-19 outbreak. For more information on CMA’s COVID-19 advocacy, click here.

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