Public Spending Agreement Keeps Looming Medicare Cuts In Place

Congressional leaders struck a deal to stave off government shutdowns, but they did not include a top priority for healthcare providers: avoiding significant Medicare reimbursement cuts due to take effect next month.

According to the Congressional non-partisan budget office, healthcare providers could lose about $ 36 billion in cost recovery due to a 4% cut that takes effect in January.

The ongoing ruling, which will be considered by lawmakers, also does not address the 2% Medicare cuts dictated by the 2011 budget sequestration law, which Congress postponed last year as part of the government’s response to the COVID-19 pandemic. Hospitals want Congress to extend the hiatus until at least next year. Legislators on Thursday didn’t detail specific next Steps but pointed out v questions will to be decided before Congress completes its affairs in a year.
“There is an Work Existence made, I am understand, on a comprehensive, bipartisan solution To v the end from v year for all from v medical provider questions,” House Appropriations Committee Chair the Rose DeLauro (D-Conn.) said during a hearing Thursday.
Congress has other options to heed supplier warnings and suspend or postpone the cut. For example, this issue could potentially be resolved in legislation to increase the debt ceiling or included in other bills that need to be passed by the end of the year. But time is running out and legislators have a whole host of other issues to tackle.

“The [continuing resolution] not the last train out of town. We will continue to pursue this, ”said Chip Kahn, President and CEO of the Federation of American Hospitals. “The leaders of both chambers are clearly aware that this can create a desperate situation and must be addressed.”

The upcoming rate cut is associated with laws adopted in 2010 and 2011 aimed at reducing the budget deficit.

The budget law, known as PAYGO, requires that an increase in deficit be offset by an increase in revenue or a reduction in spending. As the COVID-19 relief package passed this year widened the deficit, it will see a 4% cut in Medicare and other programs unless Congress takes action by mid-January.

Congress has never allowed PAYGO to cut Medicare payments, but providers urged lawmakers to tackle the problem sooner rather than later.

The Fiscal Control Act of 2011, which led to the sequestration, has resulted in automatic, widespread cost cuts across several programs since 2013, including a 2% cut in Medicare payments that has been suspended since last year.

On Thursday, the American Medical Association issued a somber note, noting that service provider groups have been pressured lawmakers throughout the year to deal with the matter.

“The end of the year is fast approaching and it is clear that Congress is not prioritizing supporting national healthcare providers who have been at the forefront of the COVID-19 pandemic,” said AMA President Gerald Harmon in a press release.

Earlier this summer, the House of Representatives passed legislation to phase out PAYGO, but it stalled in the Senate, where Republicans said they didn’t want to help Democrats move away from cuts related to the COVID-19 aid package they didn’t support.

However, Congress is unlikely to tolerate a cut in PAYGO given its negative impact on service providers, especially in the run-up to elections. Lawmakers also have not decided whether to extend the temporary 3.75% fee hike for doctors under the Medicare program introduced by Congress last year. Expires on January 1st.

Groups of doctors have pressured Congress to extend it until at least 2022. Efforts to extend the increase, led by Amy Bera, Calif. And Larry Bakshon, Indiana, enjoy bipartisan support.

“I hope this happens,” said Claire Ernst, director of government affairs at the Medical Group Management Association. “He has so much support from the healthcare provider community, and we have the support of members of Congress, especially members of the Physicians Group.”

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