President Biden signed legislation that extends Medicare sequestration relief through the end of the year. CMS is expected to resume issuing claims shortly.

Medicare Administrative Contractors will:

• release any previously held claims with dates of service on or after April 1 and
• reprocess any claims paid with the reduction applied.

No action is needed by providers.

Last year, recognizing the challenges facing the provider community during the COVID-19 Public Health Emergency, Congress suspended “Medicare sequestration” that would typically take two percent out of all Medicare fee-for-service claim payments, as well as payments to Medicare Advantage and Part D programs. Essentially, the relief gave Medicare providers and plans a temporary two percent raise. 

The relief originally extended through the end of the year. In last year’s end-of-year appropriations package, Congress extended the relief through the end of March 2020. Toward the end of March last year, the Senate passed legislation that would extend the relief through the end of 2020. Earlier this week, the House cleared the Senate’s bill extending sequestration relief through the end of 2021 and the president quickly signed the bill.

It is expected that CMS will resume processing Medicare claims, at amounts reflecting the Congressionally-mandated relief, very soon. For providers and Medicare Advantage and Part D plans, the two percent sequestration relief remains in effect through the end of 2021.