Last Thursday evening Congress approved, and President Obama signed legislation that would reverse the 21 percent cut to Medicare physician payments, and replace it with an extension of current levels of reimbursement through May 31, 2010. Thus, Medicare payment rates will again remain temporarily frozen at previous levels, the third extension since December 2009. The law is retroactive to April 1, when the 21 percent cut initially went into effect, however, the Centers for Medicare & Medicaid Services (CMS) directed Medicare contractors to delay payments for up to 10 business days while awaiting Congressional action.
Centers For Medicare and Medicaid Services (CMS) announced that they no longer had the statutory authority to delay payment of provider claims and directed their Contractors to begin processing claims starting with the oldest pending claims. However, prior to actually processing and paying these claims, the Contractors must test their system to see if the claims can process correctly. It is conceivable that this testing could take some time and by the time the Contractors complete their testing, the temporary sustainable growth rate (SGR) “fix” legislation will have been finalized.
Regardless, it is possible that some provider payments will be processed and paid at the reduced rate. In that case, for any claims for which the charge was at or above the Pre-April 1 Medicare payment rate, the contractor will automatically reprocess the claim and pay the differential owed to the provider. In the event the charge was for a lower amount (i.e. the provider reduced the charge to the post-April 1 rate) the Medicare contractor will process the claim at the reduced rate (because it would now be below the allowable). Providers in this situation will have to refile the claim in order to get paid the differential they would be owed.
The Senate vote on the bill was 59-38, and 289-112 in the House. Though it passed with some bipartisan support, Republicans in general were unhappy with the process that led to the last-minute “doc fix.” They had attempted to address this issue in the sweeping health care reform bill signed into law last month. However, because of its cost ($230 billion over ten years), the fee fix was taken out of the final reform legislation, and held until now. Democrats defended it as emergency spending, while Republicans were concerned that it would add to the deficit, since offsetting cuts in the budget were not also made.
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Editor: Philip Blann (pblann@anesthesiabilling.com).
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