Medicare cuts averted

December 13th, 2021 / Alia Paavola

President Joe Biden signed a bill into law Dec. 10 that will prevent billions in cuts to Medicare from taking effect early next year.

The law halts a mandatory 2 percent federal Medicare spending sequester until April 2022 and stops a 4 percent statutory pay-as-you-go sequester. Both sequesters are meant to limit federal spending.

The law also reduces the mandatory Medicare sequester to 1 percent from April through June of 2022 and includes a 3 percent increase in pay for providers in the Medicare physician fee schedule. The package also delays the start of the radiation oncology model until Jan. 1, 2023, to give participants the best chance to improve cancer care outcomes. 

Hospital groups, including the American Hospital Association, urged the federal government to avert the cuts, saying that without legislative action, Medicare fee-for-service payments could be reduced by $14.1 billion in 2022.

The Senate had approved the bill in a 59-35 vote Dec. 9. The House approved the bill Dec. 7 in a 222-212 vote.