May 16, 2022
Reminders About Sequestration
On December 10, 2021, the Protecting Medicare and American Farmers from Sequester Cuts Act was passed and impacts payment for all Medicare Fee-for-Service (FFS) claims:
- No payment adjustment through March 31, 2022
- 1% payment adjustment April 1 – June 30, 2022
- 2% payment adjustment beginning July 1, 2022
The 1% payment reduction (sequestration) will be:
- Applied to all Medicare FFS claims with a date of service /"through" date of service on or after April 1, 2022
- Calculated after the approved amount is determined and the deductible and coinsurance are applied
- Note: For claims with DOS that span April 1, 2022 (e.g., 031522 – 041522), the approved amount is determined based on the entire claim (not DOS on or after April 1 only).
- Reported with claim adjustment reason code (CARC) 253 (Sequestration – reduction in federal payment) on the remittance advice