23.12.20 | Noreen Hiltsley

Fee Schedule Cuts Addressed by Year-End Spending Bill

To our valued customers:

Without legislative action by the end of 2020, skilled nursing providers were facing significant cuts to Medicare reimbursement in 2021. Therapy services covered under Medicare Part B were set to be reduced by 9%. In addition, the Medicare sequestration of 2% was set to resume on January 1, 2021.

On December 21st, Congress passed the Consolidated Appropriations Act of 2021, a $1.4 trillion year-end government funding piece of legislation that includes $900 billion in COVID relief. 

Key elements of this legislation for post-acute providers include:

·    $3 Billion Add-On to Physician Fee Schedule: this will reduce the projected 9% cut to Medicare Part B therapy services to 3.6%.

·    Extension of Sequestration Relief: the 2% Medicare sequestration set to resume 1/1/2021 will be delayed 3 months.

·    Freeze on use of the new “complexity” code: to help mitigate the cuts to the Physician Fee Schedule, this legislation places a 3-year moratorium on the use of HCPC G2211, a new code that was to be used by primary care physicians to indicate an office visit had “additional complexity”.

·    SNF Value-Based Purchasing Program: allows the HHS Secretary to add up to 10 quality measures, including functional status, patient safety, care coordination, or patient experience, to the SNF VBP program. Currently, the only quality measure that is part of the SNF VBP and the associated incentive payment is the SNF 30-Day All-Cause Readmission Measure.

·    MedPAC Report to Congress: under the IMPACT Act, the Medicare Payment Advisory Commission (MedPAC) was required to submit a report to Congress by March 2023 that would include a post-acute care value-based payment program prototype. This legislation will move up that deadline by 1 year to March 2022, which may lead to additional payment reform for post-acute providers sooner than anticipated.

This legislation is still in need of the President’s approval, which is expected to happen this week. While there may be some changes to the legislation based prior to the President’s signature, the key elements impacting post-acute providers are not expected to change.

Preferred Therapy Solutions continues to provide its partners with vital information that may impact rehabilitation management, reimbursement policies, and clinical programs, supported with compliance and regulatory requirements that are necessary for a thorough understanding of practices and procedures. If you have any questions, please contact  Matt Nash, Vice President of Strategic Development at mnash@preftherapy.com.