The Centers for Medicare & Medicaid (CMS) issued a statement on Wednesday morning that because of Congressional inaction the agency will be forced implement the Medicare sustainable growth rate (SGR) formula cut of 26.5 percent beginning January 1, 2013.
If Congress does adjourn without addressing the payment cut, CMS has said it will follow normal claims processing procedures. That is, claims will not be held and Medicare carriers will process payments for physician services provided after December 31 under the normal 14-day cycle required by law. Payment for these claims would be based on the new, lower fee schedule conversion factor of $25.0008, as opposed to the current rate of $34.0376.
The California Medical Association (CMA) has spoken with California leadership in Congress to confirm that the fiscal cliff negotiations have broken down. There is also no agreement within Congress to pass a stand-alone SGR bill.
Both Republican and Democratic leaders understand that physicians cannot sustain a 26.5 percent Medicare payment cut, but it is now caught up in the politics of the “fiscal cliff.” It is critical that physicians keep contacting their members of Congress to demand action.
In addition to the SGR cut, physicians are facing a potential two percent "sequestration" cut. The sequestration cuts are part of the $1.2 trillion in cuts required by the budget deal worked out to end last year's debt-ceiling crisis.
Ultimately, CMA does not think Congress will allow the cuts to go forward on any long-term basis. At this time, it is impossible to predict whether the 112th Congress will find a way to pass a stop-gap measure before adjourning, how long such a measure would last, or how long payment cuts will be in effect until legislation can be passed after the 113th Congress convenes in January.
It is inexcusable that Congress is once again putting Medicare patients and the practices of physicians who provide them needed health care at significant risk.
“The health care delivery system is going to see an influx of patients in the next 18 months,” said Dr. Phinney. “We simply cannot continue to cut resources while adding more patients. The result will be millions of patients with insurance coverage, unable to see a physician. This is especially true in California, where we are also battling cuts to the state’s Medicaid program at the same time.”
The financial disruption this situation will cause for physicians and their practices is unacceptable. CMA will continue to fervently convey this message in the strongest possible terms to Congress and the Administration. Our grassroots network has been activated, and we are seeking your voices to tell Congress just how deeply its inaction will affect you.
Despite these efforts, CMA feels compelled to advise physicians to start making plans to mitigate this disruption and meet their own financial obligations in January. Given the potential impact on practice revenue in early January, physicians should be certain that adequate arrangements are in place to sustain their practices. For those physicians who are forced into the untenable position of limiting their involvement with the Medicare program because it threatens the viability of their practices, we urge that patients be notified promptly so that they, too, can explore other options for obtaining needed medical care.
Physicians should also be aware that they have until Dec. 31, 2012, to make changes to their Medicare participation status for 2013.
CMA will remain engaged throughout the holidays and keep you informed of any new developments.
Contact your members of Congress and urge them to work together to stop the Medicare payment cuts before they take effect on January 1, 2013.
To contact your members of Congress, use AMA’s grassroots hotline,(800) 833-6354. You will be asked to enter your ZIP code and select your Representative. Please select your Representative first, then call back to connect with Senators Boxer and Feinstein.
Source: California Medical Association, December 20, 2012.