Wound Care Articles and Insights

How to mitigate the effects of Medicare sequestration delay in processing payments

How to mitigate the effects of Medicare sequestration delay in processing payments

What is happening?

Medicare has instructed all MAC’s not to process payments for Medicare participants and providers until the 2% sequestration extension can be deliberated by congress.  The House is expected to take up the Senate-passed bill the week of April 13 when it returns to Washington D.C.

We anticipate this issue to continue until early to mid-May.  

When will it take place?

April 1, 2021.  Effective immediately, Medicare payments will cease until the moratorium period has been lifted.

How can we mitigate the effect this will have on our operations?

The following suggestions are possible ways to mitigate the financial impact on the center.  We suggest these be implemented soon, but are perhaps best practices moving forward.

  • Review your payer mix and focus your community education efforts on providers with a higher commercial payer mix for the next 6-8 weeks.  Managed Medicare plans are considered commercial payers for this project.
  • Alert your finance departments of potential reduced revenue for April, likely to be made up in May/June.
  • Diligently control costs and expenses to improve cash flow.
  • Continue to see Medicare patients as needed for medical necessity, however, ensure each of these visits are of reduced financial risk by:
    • Ensure all documentation is current, accurate and clean, so that when payments resume, reimbursement delays can be avoided.
    • Utilize the HBO/CTP Hotline
    • Note Medicare visits made during this period as ones to be reviewed for proper payment after the situation is rectified.
  • Work with your Managed Care Contract department to ensure proper fee schedules are in place and revenue codes are appropriate.  Aggressively pursue preferred provider status for any future negotiations.
  • Obtain a denial report consistently and review and check if all low pay, no pay and denials are being worked with managed care parties for maximum payment and timeliness.