Claims on hold

CMS places home health claims on short hold until Congress makes sequestration decision

If you're hearing that Medicare claims for home health are on hold, it's not an April Fool's Day joke.

Although agencies are expected to continue to receive an extra 2 percent on claims filed with dates of service beginning on or after today, April 1 2021, they’ll have to wait an unspecified period of time to receive payment because the Centers for Medicare and Medicaid Services (CMS) is temporarily holding claims.

The claims hold is in effect while CMS waits for Congress to decide whether to continue a suspension of a punitive Medicare reimbursement adjustment known as “sequestration,” which has been in effect since 2011.

During the Covid-19 public health emergency, sequestration was suspended by Congress, first under the CARES Act in 2020 and later under a 2021 government funding bill. While the suspension was in effect, agencies were not penalized as usual by 2 percent.

But the suspension granted under the 2021 legislation ended March 31.

“Without another suspension by Congress, claims filed with today’s service date would be reimbursed with sequestration back in place, and agencies would receive 2 percent less pay,” said J’non Griffin, President of Home Health Solutions – A Simione Coding Company.

To give Congress time to act, the Center for Medicare and Medicaid Services (CMS) will temporarily avoid paying claims with service dates of today and beyond.

“CMS believes Congress intends to continue to extend sequestration suspension and wants to limit the volume of claims the MACs (Medicare administrative contractors) might have to reprocess later,” Griffin said.

On hold for how long?

In its announcement this week that claims will be placed on temporary hold, CMS said it has instructed the MACs to withhold payment “for a short period without affecting providers’ cash flow."

”What everyone wants to know is what CMS means by a short amount of time,” Griffin said. “But CMS did not give a more specific timeframe.

"We are guessing that claims will be on hold at least through April 13, which is when the House returns and will have a chance to take action on it," she said.

A bill extending the suspension was passed by the House earlier, but additional measures were added when it reached the Senate. Griffin said the original bill passed by the House would have prevented a 4 percent Medicare cut from taking effect in 2022, but the Senate removed that provision.

“The bill goes back to the House for review now, and the House is currently in recess,” Griffin said. "It is scheduled to return on April 13, so that is probably the earliest date we can expect a decision on sequestration, and the claims hold to be lifted."

Adjustments later

Some claims may continue to be paid, according to the notice by CMS, which said MACs will hold claims “without affecting providers’ cash flow.”

Any claims paid now will be adjusted at a later time if necessary, with the 2 percent paid to the agency.

“The MACs will automatically reprocess any claims paid with the reduction applied if necessary,” CMS said. Here is the CMS announcement. Editor's Note: This post first appeared in a Home Health Solutions e-newsletter. To receive free industry news, insight and analysis in your inbox each week (or monthly, if you prefer), sign up here.