House Passes FY 2013 Continuing Resolution, Senate to Follow with Substitute Amendments

Recently, the House voted 267-151 to pass H.R. 933, a continuing resolution (CR), which appropriates $32.7 billion for health programs and provides funding for federal agencies through September 30. The bill capitol webalso maintains the $85.3 billion spending cuts under the sequestration mandated by the Budget Control Act (BCA) and includes the 2% reduction in Medicare reimbursements. The measure also calls for a cut of $10 million for the Affordable Care Act’s Independent Payment Advisory Board and for state Medicaid performance bonuses.

On March 11, Senate Appropriations Committee Chair Barbara Mikulski (D-MD) and the ranking member, Senator Richard Shelby (R-AL), released the Committee’s substitute amendment which provides $1.043 trillion in budget authority, consistent with the Budget Control Act of 2011. The measure also gives all federal agencies under sequestration enhanced transfer and reprogramming authority to allow them flexibility to better prioritize the sequester cuts. The Senate bill does not include full appropriations measures previously reported by the Labor, Health and Human Services appropriations subcommittee.

Among the health related provisions in the Senate version are:

  • Section 1520, which rescinds $200 million of $500 million appropriated in the Affordable Care Act for the Community Care Transitions program. This program is intended to move high cost Medicare      participants out of hospitals and into home-based care. According to the Chairwoman’s statement, the costs of this program have been lower than expected.
  • Section 1508, which will provide a $71 million increase for the National Institutes of Health and requires an Institute of Medicine/National Research Council review of the National Children’s Study.

In a statement Senator Murkowski said that her Committee would focus on rescinding sequester cuts over the next 10 years when the Senate considers its FY 2014 Budget bill. If the House and Senate arrive at a compromise before the spring recess, passage of the CR would serve to avoid a shutdown of the federal government when the current CR expires on March 27.

A summary of H.R. 933 can be found here. A summary of the Senate Appropriations Committee substitute amendment can be found here.

Mandatory Medicare Fee-for-Service Payment Reductions Due to Sequestration

On March 1, President Obama issued a sequestration order implementing mandatory reductions in federal spending as required by law unless Congress acts to address the budget crisis. As part of sequestration, claims submitted under the Medicare Fee-for-Service (FFS) program on or after April 1, 2013 will be reduced by 2 percent. Additionally, claims for durable medical equipment (DME), prosthetics, orthotics, and supplies will be reduced by 2 percent beginning April 1, 2013. Payments will be adjusted once co-insurance, applicable deductibles, and Medicare Secondary Payer adjustments are applies.

While beneficiary payments for deductibles and coinsurance are not subject to the 2 percent payment reduction, Medicare’s payment to beneficiaries for unassigned claims is subject to the reduction.

Specific questions about Medicare payments should be directed to Medicare Administrative Contractors.