Providers expect Senate to vote on Medicare sequester cuts this week

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Hospital and provider groups feel optimistic the Senate will vote this week to avert a 2% cut to Medicare payments just days before they’re scheduled to take effect, but political squabbling behind the scenes means action is still far from certain.

 

Without congressional action, Medicare sequester cuts will resume April 1 after being paused for most of the pandemic. The cuts originally took effect in 2013 but were paused by Congress last year in response to the pandemic and its effect on providers’ finances.

 

Hospitals and providers argue that COVID-19 is still causing them financial losses and lobbyists are pushing the Senate to vote this week on legislation extending the moratorium before leaving Washington Friday for a two-week recess.

 

“We expect the Senate will act this week,” said Richard Pollack, CEO of the American Hospital Association. “This isn’t the case of asking for more money. This is a situation of preventing a significant cut to Medicare payments.”

 

While extending the moratorium has bipartisan support, a disagreement between Democratic and Republican leaders in the Senate has complicated the path forward just a week before the cuts are scheduled to take effect.

 

“The clock is running out,” said Chip Kahn, CEO of the Federation of American Hospitals. “My impression is behind the scenes there is maneuvering to find a pathway for this but it’s still unclear whether it will happen. I know there is a lot of work going on to find a middle ground.”

 

The disagreement between Democrats and Republicans hinges on the $1.9 trillion COVID-19 relief bill that passed Congress earlier this month. Because it raises the deficit, the bill could result in billions of dollars in cuts to Medicare and other programs at the end of the year under a federal law called PAYGO.

 

The House passed legislation last week extending the pause on the 2% Medicare cuts through the end of the year while also waiving the COVID-19 relief bill from PAYGO effects.

 

Both provisions are big priorities for hospitals and providers, but the House bill appears unlikely to pass the Senate, where Democrats’ slim majority means they need some Republican support for passage.

 

Republicans say they don’t support waiving PAYGO for a $1.9 trillion COVID-19 relief bill that they did not support.

 

Instead, the Senate might act to delay the 2% Medicare cuts while leaving the PAYGO issue for later in the year.

 

“We expect the House will ultimately accept what the Senate does, and we would expect the Senate bill to only deal with the Medicare sequester,” Pollack said.

 

Spokespeople for Senate Majority Leader Chuck Schumer (D-N.Y.) and Senate Minority Leader Mitch McConnell (R-Ky.) didn’t respond to requests for comment, and legislation hasn’t been added to the Senate calendar this week addressing the moratorium.

 

Lobbyists say there appears to be a disagreement between Schumer and McConnell over the path forward.

 

Schumer wants to take up the House bill, dealing with the sequester moratorium and the PAYGO issue at the same time. McConnell and other Senate Republicans oppose waiving PAYGO for the COVID-19 relief bill there is bipartisan support for extending the moratorium on the 2% Medicare cuts.

 

“Senate leadership wants to avert the sequester … Republicans in general want to get this done. It’s just a question of how leadership is going to work this out,” said Ted Okon, executive director of the Community Oncology Alliance.

 

If the Senate doesn’t act this week, there’s still a chance they could pass something in April retroactively applying the moratorium to Medicare payments.

 

“It will increase the stress level and uncertainty,” Kahn said, “but we would still have a chance if it doesn’t get done this week.”

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