Senate Approves Bill to Delay Healthcare Payment Cuts

December 15, 2021

On December 9, the U.S. Senate approved the Protecting Medicare and American Farmers from Sequester Cuts Act (PMAFSCA) which the President is expected to sign into law. The legislation includes helpful provisions for hospitals and providers, including:

  • Delay of the two percent Medicare sequester cuts. The delay under the Consolidated Appropriations Act, set to expire December 31, 2021 will now continue through March 31, 2022. A one percent sequester cut will now apply from April 1 to June 30, 2022, with a full two percent cut effective July 1, 2022.
  • One-year delay in across-the-board four percent cuts. The bill delays statutory PAYGO cut in Medicare reimbursement that was to take effect January 1, 2022. The four percent cut would have been in addition to the resumption of the sequester cut mandated under the Budget Control Act.
  • A three percent increase in Medicare Physician Fee Schedule (MPFS) reimbursement. For 2022, the MPFS conversion factor was set to decrease by 3.75 percent. Congress now has authorized a three percent increase for 2022, largely offsetting the decrease. This does not impact planned adjustments to relative value units.
  • A one-year delay in cuts to the Clinical Laboratory Fee Schedule. Payment reductions required under the Protecting Access to Medicare Act of 2014 (PAMA) will be delayed until January 1, 2023. Congress also delayed by one year certain lab reporting requirements imposed by PAMA that impact hospitals that provide reference laboratory services.

The PMAFSCA also established a process for increasing the federal debt ceiling which was approved on December 14. (Andrew Busz,


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