eVoice^® Alert

June 17, 2010

CMS will process claims tomorrow, June 18,
with 21 percent cut

As the clock continues to tick toward the June 18 final deadline for implementation of the 21.3 percent cut in Medicare physician payments produced by the sustainable growth rate (SGR) formula, U.S. Senate debate continued June 17 over H.R. 4213, the American Jobs and Closing Tax Loopholes Act. In addition to providing another short-term reprieve from the impending Medicare cut, the legislation would increase federal Medicaid funding and extend various expiring programs, such as disaster relief and long-term unemployment insurance benefits.

If legislation is not signed into law before the weekend, the Centers for Medicare and Medicaid Services (CMS) will have no option but to instruct its contractors to begin processing Medicare claims for physician services provided in June at rates that reflect the 21.3 percent cut.

Once the House and Senate act to avert the cut, claims will be processed as follows:

• If the submitted charge is higher than the new rate, the contractor will automatically reprocess the claim.
• If the submitted charge is lower than the new rate, the physician should call the contractor.

CMS says almost all physicians submit claims for more than the Medicare rates. No one is going to be reviewing the limiting charge for the period that the cut was in place because CMS assumes Congress will ultimately make the fix retroactive.

The Office of Inspector General and CMS are close to releasing a document to waive patient co-pay requirements for situations such as the retroactive increases that were made to the geographic practice cost index increases. CMS will share that document once it is available.

Congressional inaction is a dereliction of duty

Democrats and Republicans in Congress are responsible for the current Medicare payment debacle. Congress has missed three separate deadlines and is now allowing cuts to go into effect that they pledged they would not allow to occur.

We expect our elected officials to resolve budget issues without punishing physicians, seniors and military families. State medical societies and national specialty societies sent a joint statement to Congress on June 16 that emphasizes this point. Continue to let your representatives and senators know that their inaction is unacceptable, and that it is harming patients and physicians across the country.

Use the AMA Physicians’ Grassroots Network toll-free hotline at (800) 833-6354 to call your lawmakers and tell them to repeal Medicare’s SGR formula once and for all.

Details on Senate impasse over Medicare physician payment cuts

The debate and delay in the Senate centers on growing concerns about how much the legislation would add to the federal deficit. On June 16, a substitute amendment to the House-passed version of the bill, offered by Sen. Max Baucus, D-Mont., was defeated on a bipartisan vote of 45-52. That amendment would have afforded a 19-month reprieve from the scheduled Medicare payment cuts by providing a 2.2 percent update for the remainder of 2010 and an additional 1.0 percent update in 2011. In 2012, physician payments would have been reduced by 33 percent.

After the defeat of his first amendment, Baucus introduced a second substitute amendment late on June 16 with reduced spending and additional funding offsets. The SGR relief provision was scaled back to a six-month, 2.2 percent update that would expire Nov. 30, 2010, after which the 21.3 percent cut originally scheduled for 2010 would take effect. Reports from Capitol Hill on June 17 indicate that this package may still lack the bipartisan support needed to reach the 60-vote threshold that is required to end debate and pass a final bill.

On June 17, an amendment offered by Sen. John Thune, R-S.D., was defeated on a vote of 41-57. The amendment was far less costly than either Baucus proposal, and according to the Congressional Budget Office, would begin reducing the federal deficit. It also would have provided 2.0 percent Medicare physician payment updates for the remainder of 2010 and all of 2011 and 2012, followed by a steep payment cut of well over 30 percent and an additional statutory cut of 4 percent. The Thune amendment also included medical liability caps on non-economic damages and other traditional tort reforms.

Because the Senate is considering substantial revisions to H.R. 4213, the bill will have to be sent back to the U.S. House of Representatives for passage. While House leaders have indicated they are prepared to stay in session late tomorrow, June 18, so that a vote can be held on the bill, it is far from clear that the Senate will be able to complete its consideration before the weekend.