CMS Releases Additional Information Regarding 21% SGR Cut to Medicare Physician Services Effective April 1, 2015

Senate Expected to Consider H.R. 2, SGR Repeal and Replace Legislation Today

Late yesterday, the Centers for Medicare and Medicaid Services (CMS) released additional information regarding the 2015 Medicare Physician Fee Schedule (MPFS).  As you are aware, the SGR formula required a 21% decrease in all MPFS payments beginning on April 15th, 2015.  CMS took steps to limit the impact on Medicare providers and beneficiaries by holding claims paid under the MPFS with dates of service on and after April 1, 2015.  CMS is now indicating in the absence of additional legislation to avert the negative update, they must update payment systems to comply with the law and implement the negative update.

Therefore, beginning on April 15, 2015, CMS will release held MPFS claims, paying at the reduced rate, based on the negative update, on a first-in, first-out basis, while continuing to hold new claims as they are received.  CMS will release one day's worth of held claims, processing and paying at the rate that reflects the negative update. At the same time, CMS will hold the receipts for that day, thus, continuing to hold 10 days' worth of claims in total. This is to provide continuing cash flow to providers, albeit at the rate that reflects the negative update. This “rolling hold” will help minimize the number of claims requiring reprocessing should Congress pass legislation changing the negative update.

Claims for services furnished on or before March 31, 2015 are not affected by the payment cut and will be processed and paid under normal time frames.  CMS has stated they are working to limit any impact to Medicare providers and beneficiaries as much as possible. The MACs will automatically reprocess the claims paid at the reduced rate if Congressional action is taken to avert the negative update.  No action is necessary from providers who have already submitted claims for the impacted dates of service.

The Senate is expected to begin consideration of H.R. 2, the SGR repeal and replace legislation, this afternoon.  This legislation passed the House, and the President will sign the bill as soon as the Senate approves it.  We will continue to keep you updated.