Sequestration, the 2 percent automatic spending cuts to Medicare fee-for-service providers, will resume July 1.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act suspended the sequestration payment adjustment from May 1 through December 31, 2020. The Consolidated Appropriations Act, 2021, extended the suspension period to March 31, 2021. An Act to Prevent Across-the-Board Direct Spending Cuts, and for Other Purposes, signed into law on April 14, 2021, extended the suspension period to December 31, 2021.
No payment adjustments were made through March 31; a 1 percent adjustment was put in place for claims made April 1-June 30, with the full resumption of the cuts beginning July 1.
The 2011 Budget Control Act instituted annual 2 percent reductions in Medicare payments as part of an effort to control spending.
