Medicare Doc Payment Cuts Take Effect; CMS Has Flexibility To Delay

Although a 21% cut to physician reimbursements called for by Medicare's sustainable growth rate formula takes effect April 1, CMS could delay such reduced payments for several months, according to former CMS Administrator Tom Scully, The Hill reports (Ferris, The Hill, 3/31).

Background

The House last week voted 392-37 to approve legislation (HR 2) to permanently replace Medicare's SGR. However, the Senate is not scheduled to consider the measure until it returns from recess on April 13.

Senate Majority Leader Mitch McConnell (R-Ky.) said the delay would not affect providers because of the normal lag time in claims processing (California Healthline, 3/27). CMS typically waits 14 days to process electronic claims and at least 29 days to process paper claims. As a result, physicians might not face lowered reimbursements if the Senate acts quickly when it reconvenes on April 13 (Howell, Washington Times, 3/27).

'You Could Hold It Off for Three Months'

Scully, a CMS administrator under President George W. Bush, said CMS "could hold [payment] off for three months if [they] wanted to," but providers would only back such a delay if they are certain officials will ensure payment at a later date. However, he added that "after two weeks [of payment delays], it gets pretty awkward."

Scully also said federal officials can cut reimbursement rates temporarily and then make the full payments retroactively, if Congress acts. However, Scully said that such a process would be a "waste of time" and costly.

Frustration With Limbo

Physician groups have expressed frustration that the Senate went on recess prior to voting on the permanent SGR replacement bill, according to The Hill (The Hill, 3/31).

The American Medical Association in a statement on Friday said it is "extremely disappointed" that the Senate did not vote on the House-passed SGR replacement measure (Washington Times, 3/27). Both AMA and the American Academy of Family Physicians have called on the Senate to make the SGR replacement bill its number one priority after recess.

AAFP in a statement said, "The time to act is now. The House has provided an overwhelming bipartisan vote of approval. The Senate should do no less and should do so as quickly as possible. Americans have already waited 12 years for this vote" (The Hill, 3/31).