Tuesday night, the U.S. Senate approved legislation that permanently repeals and replaces the flawed Medicare payment formula known as the Sustainable Growth Rate (SGR). The same bill, Medicare Access and CHIP Reauthorization Act (MACRA) (HR 2), passed through the House two weeks ago, and President Obama has indicated he will sign it into law quickly.
With the Senate’s passage of the bill, physicians avoid a 21 percent decrease in their payments and will instead receive a .5 percent increase each year through 2019. At that point, payment increases—or penalties—will be assessed based on a new value-based formula known as the Merit-Based Incentive Payment System (MIPS) which streamlines and improves on the Physician Quality Reporting System, the Value-Based Payment Modifier, and the Meaningful Use of EHRs. Beginning again in 2026, MACRA will allow providers meeting certain criteria to receive annual updates of .75 percent, while all other professionals would receive annual updates of 0.25 percent.
Many other provisions also were included in MACRA, including a two-year extension of the Children’s Health Insurance Program, a delay of the “two midnight” rule through September 30, and a reversal of the CMS decision to eliminate bundled payments for surgical services that span a 10- and 90-day period.
Six amendments to the House bill were proposed in the Senate. However, all six amendments were defeated, and the bill was passed just as it left the House.
What About Your Claims?
In an effort to minimize financial effects on providers in the event the bill wasn’t passed, the Centers for Medicare and Medicaid Services (CMS) previously instituted a 10-business day processing hold for all impacted claims with dates of service April 1, 2015, and later. While the Medicare Administrative Contractors (MACs) have now been instructed to implement the rates in the legislation approved Tuesday night, because of the late passage of the bill, a small volume of claims will be processed at the reduced rate based on the negative update amount from the previous SGR methodology. The MACs will automatically reprocess claims paid at the reduced rate with the new payment rate.
Because of the CMS-enacted hold, CIPROMS continued to process claims normally for the past two weeks. While we do not believe any of our clients’ claims will be paid at the negative update amount, CIPROMS will continue to monitor all payments and follow up with WPS Medicare in the event any are to ensure correct reprocessing.
For more information, you can review a section-by-section analysis of HR 2 or a summary prepared by the House Committees on Energy & Commerce and Ways & Means. CIPROMS will provide further details about implementation of MACRA as information is released.
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