Senate Passes S.610 Bill, Averting PAYGO and Sequester Cuts From Taking Effect at the Beginning of 2022

Published in Government Relations on December 10, 2021

Yesterday, the Senate passed S.610 - Protecting Medicare and American Farmers from Sequester Cuts Act, delaying implementation of an additional 4% reduction in reimbursement for Medicare providers and suppliers as well as the 2% reduction in Medicare sequestration cuts. Congress had deferred the cuts during the COVID-19 public health emergency, but the deferral is scheduled to expire at the end of this year. S.610 extends the 2% freeze until March 31, 2022, and then reduces the freeze to 1% from April 1, 2022 to June 30, 2022.

Relief from 2% Medicare Sequester

The bill would eliminate for three months the 2% Medicare sequester cuts on hospitals and others providers that are scheduled to resume Jan. 1, 2022. In addition, the legislation would reduce the 2% sequester cut to 1% from April 1, 2022 through June 30, 2022. The package would be paid for by increasing the sequester percentage in 2030.

Halting Statutory PAYGO Sequester for 2022

The bill would stop the 4% PAYGO sequester from taking effect early next year. Any cuts mandated by a sequester order for the 2022 “PAYGO scorecard” would be delayed and added to the “2023 scorecard.” This does mean Congress will need to take action in late 2022 to eliminate these cuts. The Congressional Budget Office has estimated that a Statutory PAYGO sequester in fiscal year 2022 resulting from passage of the American Rescue Plan Act of 2021 would cause a 4% reduction in Medicare spending – or cuts of approximately $36 billion.

  • Provides a three-month delay of the Medicare sequestration reductions and a three-month, one percent reduction in Medicare sequestration payment reduction.
  • Provides a one-year increase in the Medicare physician fee schedule of 3 percent to support physicians and other health professionals in adjusting to changes in the Medicare physician fee schedule during 2022.
  • Provides a one-year delay of Medicare payment reductions to the clinical laboratory fee schedule and the private payer laboratory data reporting requirements.
  • Provides a one-year delay of the implementation of the Medicare radiation oncology model.
  • Increases funding for the Medicare Improvement Fund by $101,000,000.
  • Prevents Statutory PAYGO sequestration through 2022, preventing automatic across-the-board cuts to Medicare, farm programs, social services, student loans, resources for students and individuals with disabilities, among other programs.
  • The bill would create in law a one-time expedited process lasting through January 16, 2022, for the Senate to consider legislation increasing the debt limit by a specific dollar amount at a simple majority threshold.

Click here to view the bill summary. The bill now heads to President Biden’s desk for a signature.


TAGS

  1. covid-19
  2. medicare
  3. phe

From Our Experts

The Return of Competitive Bidding thumbnail The Return of Competitive Bidding The Centers for Medicare & Medicaid Services (CMS) appear to be laying the groundwork for another round of the Competitive Bidding Program (CBP). While full implementation will take a couple of years, an official announcement is expected this summer—potentially as early as July. Out With The Old RAC, In With The New thumbnail Out With The Old RAC, In With The New On April 28, 2025, CMS awarded Cotiviti GOV Services LLC, the new RAC Recovery Audit Contractor (RAC) Region 3, 4, and 5 contracts. RAC Region 3 includes the following Medicare Administrative Contractor (MAC) jurisdictions: JJ, JM, and JN. RAC Region 4 includes jurisdictions: JE, JF, and JL. And RAC Region 5 includes jurisdictions: JA, JB, JC, JD, as well as the HH/H MACs: J6, J15, JK, and JM. Iowa Leads the Charge! All Four Representatives Back H.R. 2005—Will Your State Step Up? thumbnail Iowa Leads the Charge! All Four Representatives Back H.R. 2005—Will Your State Step Up? At VGM Group, Inc. we have the pleasure of serving our members and partners throughout the country.  One of the many ways we do this is through legislative advocacy, working with our partners to create a more equitable and effective healthcare system. All our VGM units are dedicated to advancing our partners' businesses, streamlining operations, and working every day to enhance reimbursement for the quality in-home healthcare our industry provides all people. Mike Hamilton Of ADMEA Honored With The Mal Mixon Advocate Award thumbnail Mike Hamilton Of ADMEA Honored With The Mal Mixon Advocate Award Last week, during the 2025 AAHomecare Washington Legislative Conference, Mike Hamilton, Executive Director of ADMEA, was honored with the prestigious Mal Mixon Advocate Award. VGM Senior Leaders Engage in Advocacy at AAHomecare Legislative Conference thumbnail VGM Senior Leaders Engage in Advocacy at AAHomecare Legislative Conference This week, VGM leaders attended the AAHomecare Legislative Conference in Washington, D.C., a premier event dedicated to advancing healthcare policy and advocacy. AAHomecare provided attendees with valuable insights, equipping them with key discussion points and strategies for effective meetings with legislators. Champion of Change: Paula Vineyard of Elana Health & Loop Medical Leads Healthcare Advocacy in West Virginia thumbnail Champion of Change: Paula Vineyard of Elana Health & Loop Medical Leads Healthcare Advocacy in West Virginia On Thursday, May 8, Paula Vineyard, owner of Elana Health & Loop Medical, took a pivotal step in healthcare advocacy by hosting a meeting with Tyler Ohrn, Field Representative for Congresswoman Carol Miller of West Virginia's First District. The hour-long discussion centered on the pressing need for congressional support of H.R. 2005. Manufacturer Survey On Tariffs thumbnail Manufacturer Survey On Tariffs The American Association for Homecare and VGM Group are seeking valuable insights from durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) manufacturers and vendor partners regarding tariffs imposed on certain countries. Key Payers Denied Your Application Citing Their Network Is Closed – Now What? thumbnail Key Payers Denied Your Application Citing Their Network Is Closed – Now What? This experience has increasingly become one of the most common questions we receive from our provider members as more and more payers move to narrow their provider networks. The reasons payers seek to narrow their networks are simple. Payers are highly motivated to achieve their goals while doing less work and are not required to allow providers into their networks unless there is a patient access issue. For those of you fortunate enough to be a part of a narrow network, this may not be much of