On March 8, the Centers for Medicare & Medicaid Services (CMS) announced a 2 percent reduction in Medicare fee-for-service (FFS) payments effective April 1, 2013, as part of the mandatory reductions in federal spending known as sequestration, required by the Budget Control Act of 2011, and issued by President Obama on March 1.
CMS has provided several questions and answers on Medicare and sequestration that address, among other things, the use of claim adjustment reason code (CARC) 223 to report the sequestration reduction. CMS also confirms that sequestration modifies final FFS payments to providers, not fee schedules and pricers, and it provides examples of how claims are calculated after application of patient cost-sharing.
