The National Association for the Advancement of Orthotics & Prosthetics (NAAOP) released a webcast on March 6 in which NAAOP General Counsel Peter Thomas, JD, provided the following summary of the effects of the sequester on O&P Medicare providers.
- Veteran’s health, Medicaid, and Social Security programs are exempt from the sequester; there we do not expect similar cuts in payments for veterans’ O&P care, but this is unconfirmed.
- Medicare is not exempt from the sequester and will have a 2 percent cut in all provider fees, including O&P providers and suppliers. While the cuts are technically effective March 1, it will be several weeks before the Centers for Medicare & Medicaid Services (CMS) can implement the changes necessary to process claims. However, the Office of Management and Budget (OMB) suggests it will be April 1 before the fee cut will be applied.
- Because the sequester is a seven-month long cut, and the Medicare cuts are expected to be implemented over a six-month period, the question is whether that 2 percent fee will climb to 2.2 percent to make up for the revenue lost during the implementation delay.
- The magnitude of the spending cuts is much greater for other federal programs of interest to the O&P profession. The National Institutes of Health (NIH0 budget will be cut by $1.6 billion, the Centers for Disease Control and Prevention (CDC) budget will be cut by $289 million, Health Care Fraud and Abuse Control will be cut by $57 million, and the Office of the Inspector General (OIG) budget will be cut by $3 million. Ironically, cuts to the fraud and OIG accounts will slow the pace of healthcare fraud and abuse investigations, as well as Medicare contractors’
efforts to recover overpayments of Medicare claims. Sequestration will also create furloughs for 4.4 million federal workers, including Congressional staff, totaling 22 unpaid work days between now and September 30th for each employee. This includes Medicare Administrative Law Judges (ALJs) and their staff, meaning that waiting times for ALJ hearings for O&P claims denials will only get worse.
The webcast is posted on the NAAOP website and on oandp.com, shared with members via e-mail, and made available through the NAAOP page on Facebook.