Medicare reimbursement advocacy crucial after Joint Committee failure

Psychology now must wage an end-of-year battle to halt the scheduled 27.4 percent Sustainable Growth Rate (SGR) cut and prevent expiration of the 5 percent psychotherapy payment extender

By Government Relations staff

December 8, 2011—After several months of deliberations aimed at identifying at least $1.2 trillion in debt savings, the Joint Select Committee on Deficit Reduction, created by the Budget Control Act of 2011, announced on November 21 it had failed to reach a consensus. The outcome sets up automatic recurring reductions in Medicare and defense spending from 2013 through the next decade. For psychologists and other Medicare providers, this would mean up to an additional 2 percent reduction in payments beginning in 2013.

The Joint Committee’s failure also means that once again psychology will have to wage an end-of-year battle to halt the scheduled 27.4 percent Sustainable Growth Rate (SGR) cut and prevent expiration of the 5 percent psychotherapy payment extender.

The Medicare SGR payment formula adjusts Medicare provider payments based on factors related to the national economy. Congress has blocked the SGR cut 12 times since 2001 and the APA Practice Organization has successfully secured the psychotherapy restoration three times since 2008, but practitioners face a tougher climate this time around in light of the unprecedented focus on deficit reduction and the broadening divide between legislative leaders.

Through the Medicare Improvements for Patients and Providers Act of 2008, Congress partially restored the cuts made by the Centers for Medicare & Medicaid Services (CMS) "Five-Year Review" through 2009. Subsequent laws then extended the restoration through December 2011. An extension is necessary until completion of the current Five-Year Review of psychotherapy codes, which has been delayed into 2012.

Congress is due to adjourn for the winter holidays soon and will return early in 2012. We expect a flurry of activity as Congress decides whether to include Medicare extenders with the expected halt of the SGR cut. Also in question is whether Congress, focused this term on deficit reduction, decides to include offsets to any payments, and what those offsets would be.

In the waning days of 2011, grassroots advocacy is crucial. Visit the Legislative Action Center to urge your Senators and Representative to halt Medicare cuts to psychological services.