Congress reaches bipartisan, bicameral agreement to stop looming Medicare cuts

December 07, 2021

Legislation to stop the looming Medicare physician payment cuts has been introduced in Congress and could be on the floor for a vote in the U.S. House of Representatives as early as Tuesday night. The bill – the Protecting Medicare and American Farmers from Sequester Cuts Act (S 610) – is a bipartisan, bicameral leadership agreement. 

The California Medical Association (CMA) deeply appreciates the leadership of House Speaker Nancy Pelosi and the support of Minority Leader Kevin McCarthy, Senator Dianne Feinstein, Senator Alex Padilla, and the California Congressional Delegation.

Without Congressional action before the end of the year, physicians would be facing the following stack of Medicare financial hits:

  • Expiration of last year’s Congressionally enacted bill to stop the 3.75% payment cuts to the Medicare physician fee schedule. Physicians were facing these cuts due to budget neutrality adjustments in the fee schedule but fortunately, Congress stepped in and stopped the cuts. 
  • Expiration of the current Medicare 2% sequestration cut wavier given during the COVID-19 public health emergency.
  • Imposition of an inadvertent 4% statutory “pay as you go” (PAYGO) budget neutrality sequester resulting from passage of the American Rescue Plan Act. Should lawmakers fail to act, it will mark the first time that Congress has failed to waive statutory PAYGO.
  • A freeze in annual inflation updates for Medicare physicians. 

Physician practices are still recovering from the emotional and financial impact of the COVID-19 public health emergency. If left unchecked these cuts could cause a serious disruption in patient access to care.

The bill currently being considered in Congress would extend the Medicare sequestration cut waiver, increase physician payments by 3% in 2022 to offset most of the 3.75% fee schedule cuts due to budget neutrality adjustments, and stop the inadvertent 4% statutory “pay as you go” budget neutrality sequester resulting from the passage of the American Rescue Plan Act.

The legislation would also delay for one year the Medicare Radiation Oncology Payment Model, the Medicare clinical laboratory payment cuts, and the private payor payment reporting requirements.

CMA and the California Hospital Association yesterday sent a joint letter to the California Congressional Delegation, urging immediate action to eliminate or delay the Medicare payment cuts that are scheduled to go into effect on January 1, 2022.


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