Medicare Sequestration Begins Again April 1 (at 1%)

Two years ago Congress made moves to eliminate the sequestration reduction in payments from Medicare. Although sequestration was delayed through the pandemic, on April 1, 2022, sequestration reduction begins to phase back in. Watch the video to learn more!

Transcript:

At the beginning of the public health emergency, at the beginning of the pandemic, two years ago, Congress made some significant moves in regard to finances. One of those key moves was to eliminate the sequestration, a reduction in payment, that we’ve dealt with for really well over a decade in our Medicare payments. So we wanted to make everybody aware that, although it’s continued to be delayed throughout this public health emergency, it begins to phase out that elimination of that sequestration begins to phase out on April 1, and here’s how it’s going to work.

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On April 1, they’re going to reintroduce the sequestration reductions to the tune of 1%, and then they’ll add the second percent or another percent on July 1 of this year. So April 1, 2022, sequestration will come back into play and there’s a 1% reduction July 1, then it goes up to 2%. Now remember, this doesn’t actually impact the actual covered amounts by Medicare. Instead, what it does is it impacts the actual direct payments that you receive from the federal government.

For example, you are going to collect still the 20% from the patient, you will collect that entire 20%. But the feds are only going to reimburse then as opposed to the full 80%. Beginning April 1, they’re just going to reimburse, what is that, 79.2%. Then reduce to 78.4%, beginning in July of 2022, July 1, 2022, because up to 2%. So you know, we’ve had the hiatus, if you will the the break from a sequestration for the past two years, but beginning on April 1. So beginning just a couple of days from now, then you’ll begin to see those reductions in payments from the federal government and at 1% and then July 1, 2%. Hopefully, this at least helps you out and explains why some of those payments will come in lower than what you were potentially expecting from the federal government on those Medicare reimbursements, and we’ll catch you next week.