Mandatory payment reduction of 2 percent continues until further notice for the Medicare FFS program – ‘Sequestration’

Medicare Fee-For-Service (FFS) claims with dates-of-service or dates-of-discharge on or after April 1, 2013, will continue to incur a 2 percent reduction in Medicare payment until further notice. This sequestration reduction is in addition to the 2% reductions for EHR non meaningful use, and 2% for noncompliance with PQRS reporting.

The claims payment adjustment will continue to be applied to all claims after determining coinsurance, any applicable deductible, and any applicable Medicare secondary payment adjustments. Though beneficiary payments for deductibles and coinsurance are not subject to the 2 percent payment reduction, Medicare’s payment to beneficiaries for unassigned claims is subject to the 2 percent reduction.


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