Claims to be held by CMS for first 10 business days of April

While Congress hashes out whether and how to avert the more than 20 percent pay cut now set to start on April 1, CMS is making its own contingency plans to avoid paying out a lot of claims that will need to be re-processed later, if Congress ends up missing the April 1 deadline for action.

CMS has ordered its Medicare Administrative Contractors (MACs) to hold off on all processing of claims with a date of service of April 1 or later for 10 business days. Claims with dates of service of March 31 or earlier will continue to be processed under the normal schedule.

In its announcement, CMS says it believes that this won’t significantly impact your cash flow, because clean Medicare claims are not ever paid without a 14 calendar day hold, or 29 days for paper claims. A claim is considered to be paid on time if it is paid within 45 days.

It’s still unclear exactly how the Senate will vote on the recently passed House legislation to extend Medicare’s current payment rates through March 2015. Specialty groups are opposed to the bill, arguing instead for permanent SGR repeal.

It’s not unusual for CMS to try and slow down its claims payment to give Congress extra time to pass an expected law that will impact payments, to avoid an en masse reprocessing of claims that need to have payment adjustments.

On one occasion, when the pay fix was so late that claims were paid at a lower rate, the added cost of reprocessing millions of Medicare claims and issuing batch payments to providers led to the reprocessing being delayed by months.

Even with this hold, however, your cash flow and payments may slow down slightly in April and into early May as the claims processing system catches up to the pended claims.