In The Spotlight

Law postpones SGR payment cut again

The 21.3 percent Sustainable Growth Rate (SGR) cut in Medicare payments has been postponed, retroactive to June 1 and through November 30, 2010

by Government Relations Staff

June 30, 2010 — On Friday June 25, President Obama signed the Preservation of Access to Care for Medicare Beneficiaries and Pension Relief Act of 2010 (H.R. 3962), postponing the 21.3 percent Sustainable Growth Rate (SGR) cut in Medicare payments retroactive to June 1 and through November 30, 2010. The new law also gives a 2.2 percent increase in Part B reimbursement for services delivered from June 1 through November 30.

The day before, by a vote of 417-1, the House of Representatives showed its support of the Senate’s bill, which passed that chamber by a unanimous vote on June 18.

As the last SGR cut postponement expired June 1, before Congress had voted through a bill, the Centers for Medicare and Medicaid Services (CMS) instructed Medicare Administrative Contractors (MACs) to delay until June 18 processing claims at lower rates. Now that retroactive legislation has been signed into law, affected payments are being processed on a rolling, first-in/first-out basis. Claims already paid at lower amounts due to the temporary application of the SGR cut will be automatically adjusted so that psychologists and other providers will receive full payment for their services without having to resubmit the claims.

The Medicare 'sustainable growth rate' or SGR payment formula, ties Medicare provider payments to factors related to the national economy. In recent years, the formula would have operated automatically to cut most provider payments if Congress had not acted to postpone the scheduled payment cuts. The American Psychological Association Practice Organization (APAPO) continues to keep up the pressure for Congress to enact a permanent solution to the SGR payment formula.

The APAPO will keep members updated about emerging developments with postings on the Practice Central website and in the Practice Update e-newsletter.