Medicare sequester moratorium extended

December 16, 2021

The U.S. House and Senate late last week voted to extend the moratorium on the 2 percent Medicare sequester through March 31. The bill sets the sequester level at 1 percent from April 1 – June 30. It returns to 2 percent on July 1. President Biden signed the measure into law shortly after it cleared its final hurdle in the Senate.

Washington Rep. Kim Schrier (8) authored the House version of the bill.

“A pandemic is not the time to be cutting access to doctors for patients on Medicare,” she said while introducing the bill. “This legislation will bring some stability to the Medicare payment system to ensure patients can keep seeing their doctors. And doctors, who have been on the frontlines during this pandemic, can continue to keep their doors open.”

The bill also waives the Pay-As-You-Go (PAYGO) requirements for 2022. The PAYGO rules require across-the-board cuts to mandatory spending programs if legislation enacted during the year has increased the federal deficit. COVID relief and economic stimulus legislation enacted earlier in 2021 triggered the PAYGO requirement.

If it had been in effect for all of 2022, the 2 percent sequester would have reduced Medicare payments to Washington’s hospitals by $90.7 million, according to estimates from the American Hospital Association. Failure to waive the PAYGO rules would have resulted in a $181.4 million cut in Medicare payments.

The measure also increases payments for physicians by 3 percent for CY 2022, following a 3.75 percent increase for 2021. The 15 percent reduction in payments for clinical lab tests is eliminated in 2022 but reimposed in CY 2023 – 2025. (John Flink)


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