2006 Medicare Fee Schedule: Reversal of 4.4% Payment Reduction Expected Soon
by Federal Regulatory Affairs Staff
January 19, 2006 -- If you provide services to Medicare beneficiaries, you may already have received lower reimbursement compared to 2005 for services that you delivered on or after January 1, 2006. But those payments should increase soon if, as the APA Practice Organization expects, budget reconciliation legislation now pending in Congress becomes law early this year.
With strong grassroots support from psychologists throughout the country, the APA Practice Organization advocated throughout 2005 for Congress to adjust the Medicare fee schedule to avoid a 4.4% payment reduction scheduled for January 1. Shortly before adjourning in December, both the House of Representatives and the Senate voted in favor of budget reconciliation legislation that would negate the 4.4% cutback and keep 2006 Medicare payment rates at 2005 levels.
But Senate amendments to the bill passed by the House necessitated another House vote that did not happen by the end of the 2005 congressional session. Efforts by Congress to avert the cutback were put on hold when the 2005 legislative year drew to a close.
Budget reconciliation is expected to resume shortly after Congress reconvenes late in January. Staff for the APA Practice Organization anticipate a vote on the legislation in early to mid-February. Congress could make any adjustment to the Medicare fee schedule retroactive to January 1, 2006.
In a January 6 letter to Rep. Bill Thomas, Chairman of the House Ways & Means Committee, the Centers for Medicare and Medicaid Services (CMS) indicated that it is preparing to instruct local carriers to implement any new update to the fee schedule in a manner that will be least disruptive to providers and beneficiaries. CMS specified that it expects carriers to begin paying claims at the adjusted rate within two days after the legislation is enacted.
The CMS letter also indicated that, if Congress makes payment adjustments retroactive to January 1, local Medicare carriers will be directed to automatically reprocess any 2006 claims paid at the 4.4% lower rate. As a result, psychologists would not have to resubmit any claims that were paid at the reduced rate.
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