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eDocTalk article

Provider practices hit with 2 percent cut

May 2013

With Congress failing to reach a deficit reduction agreement, the sequestration process has kicked in and Medicare provider and insurer payments have been cut by 2 percent as of April 1.

The cuts apply to provider payments for services administered under Medicare Hospital Insurance (Part A), Medicare Medical Insurance (Part B), the contractual payments to Medicare Advantage Plans (Part C) and Medicare Prescription Drug Plans (Part D), according to the Congressional Budget Office.

There are exemptions for low-income subsidies, and there are additional subsidies for beneficiaries whose spending on prescription drugs exceeds catastrophic levels.

Part B impact

According to the Centers for Medicare and Medicaid Service (CMS), the 2 percent cut will not be passed along to Medicare beneficiaries’ copays or deductibles. CMS says, "The claims payment adjustment shall be applied to all claims after determining coinsurance, any applicable deductible and any applicable Medicare secondary payer adjustments." This is the case for assigned claims –– those where the patient agrees to have Medicare pay the physician directly.

For unassigned Part B claims, Medicare payments to beneficiaries will be subject to the 2 percent reduction.

Meaningful use payments cut

The sequestration – across the board – cuts also affect meaningful use payments, according to Decision Health’s Part B News. "If your practice attested for meaningful use and receives its payments after April 1 – even if your group or eligible professional attested before that date –– the $18,000 payment will reduce by 2 percent or $360," it states.

For more information:

American Colleges of Physicians

Palmetto administrators Q/A

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