House passes bill that delays 6% in Medicare cuts, postpones radiation oncology model

by Robert King | Dec 7, 2021

The House passed by a vote of 222 to 212 a bill that delays 6% in Medicare cuts set to go into effect Jan. 1 and reduce most of a 3.75% cut to physicians, handing providers a major win they have been fervently lobbying Congress for.

The House Rules Committee released text Wednesday that addresses the series of cuts that come from sequestration, the Pay-As-You-Go Law (PAYGO) and the Physician Fee Schedule (PFS). The legislation is now sent to the Senate, which will need to pass it before the cuts go into effect Jan. 1.

Providers are facing a 2% cut to Medicare payments created under sequestration and delayed last year by Congress to help providers blunt the financial impact from the pandemic. Another 4% cut to payments is triggered by the PAYGO law, which calls for mandatory cuts to Medicare and other services if government spending reaches a certain threshold.

The text released by the House would delay the Medicare sequestration cuts through March 31, 2022. Starting in April, it will reduce the sequester cuts to 1% through June.

It also delays the PAYGO cuts until the start of 2023.

The legislation would also lower a 3.75% cut to physician payments to 0.75% starting next year. Physician groups had been hoping the cut set as part of the PFS would be delayed entirely.

The Surgical Care Coalition, which represents 13 surgical professional associations, applauded the changes but asked for a more permanent solution.

"Continuing to cut Medicare over time will only reduce access to care in the long-term, and when Congress returns in January, they must address the broken Medicare payment system with systemic changes to ensure surgeons can focus on what they do best – improving and saving lives," said American College of Surgeons Executive Director David Hoyt in a statement.

In addition to the cuts, the legislation also makes several changes to other healthcare policies. It delays the start of a controversial radiation oncology model from Jan. 1, 2022, until 2023.

Oncology groups have warned that the mandatory model will lead to harmful cuts to radiation oncologists. The model is intended to make site-neutral payments for certain radiation services.

However, Congress delayed the start date of the model from July 1, 2021, to Jan. 1, 2022. If the legislation is signed into law, it would be delayed for another year.

The legislation also delays until 2023 a cut of up to 23% of payments to clinical lab services. A group of 22 lawmakers wrote to House leadership earlier this week pressing for a delay to the cuts, which were required under budget neutrality rules in the PFS.

Provider groups have been imploring Congress not to let the cuts go into effect, arguing they are still fighting against the pandemic and need the additional resources.

Groups were livid that Congress passed a short-term government spending bill last week without any action on the cuts. Such spending packages are usually vehicles that include such extenders.

Providers are now pressing for legislative action on the deal. 

"Doing so will remove the uncertainty these cuts are creating and stop this potential threat to the patients and communities we serve each day," American Hospital Association President and CEO Rick Pollack said in a statement.

But House Democrats also attached a measure to let the Senate raise the federal debt ceiling by a strict majority vote as the Treasury is expected to reach the debt ceiling next week and could default. It remains unclear whether Republicans could kill the legislation because of the provision.

Republicans on the Rules Committee blasted the decision by Democrats to add the debt ceiling provision. 

"This issue has remained bipartisan. I thought it would remain that way," said Rep. Larry Bucshon, R-Indiana.

However, Senate Minority Leader Mitch McConnell and Majority Leader Chuck Schumer announced a deal Tuesday in the Senate to support Democrats raising the debt ceiling by 51 votes, improving chances for the package's prospects in the Senate.