The National Association for Home Care & Hospice said Thursday it opposes a plan in the Biden administration’s $5.8 trillion proposed fiscal 2023 budget to extend Medicare sequestration provider cuts an additional year. NAHC estimates the cuts would cost home health providers $360 million in penalties and hospice providers $440 million in penalties.
“The annual stress and threat of continued Medicare cuts is an ongoing challenge to home-based providers’ stability and predictability,” NAHC spokesman Thomas Threlkeld told McKnight’s Home Care Daily Pulse in an email. “NAHC is committed to fighting against harmful payment reductions and advancing sensible long-term sequestration relief.”
Sequestration in effect today
The Infrastructure Investment and Jobs Act of 2021 previously extended the cuts through 2031, but under Biden’s 2023 budget proposal released this week, they would run through 2032. The extension would save the federal government an estimated $7.6 billion.
The 2% Medicare sequestration cuts, paused since 2020 to help providers deal with the financial fallout of the COVID-19 pandemic, resume today. Under a plan passed by Congress last December, the cuts will be 1% between now and the end of June and increase to 2% in July.
Still, NAHC argues providers need continued flexibility to offset a number of ongoing COVID-19 expenses, including personal protective equipment, additional staffing, overtime and lost revenues.
Positive aspects of budget
Despite the extension of sequestration, the proposed budget includes additional funding that would benefit the home health and hospice industries. It would provide a 15% increase in funding to the Department of Health and Human Services. Included in the approximately $127 billion earmarked for HHS is $2.1 billion in workforce programs, $35 million to improve health equity in Medicare and Medicaid programs and funding to improve oversight, information technology and data collection, according to NAHC.
The budget is a list of priorities for the Biden administration, with Congress ultimately having the final say on funding. The budget for FY 2023 begins Oct. 1, 2022.
