House passes bill to avert Medicare cuts, but Senate action uncertain

What providers and insurers can expect from the latest COVID-19 relief bill

The U.S. House of Represenatives passed legislation Friday that would prevent Medicare cuts to providers but its future is unclear in the Senate, where Republicans are bitter over the recently passed COVID-19 relief bill that passed along party lines.

The legislation, introduced by House Budget Committee Chairman John Yarmuth (D-Ky.) and passed 246-175, would extend a pause on the 2% Medicare sequester cuts through the end of the year.

Those cuts originally took effect in 2013 but were paused in December in response to the pandemic and its effect on providers’ finances.

Without action from Congress, the cuts will resume April 1, but hospitals are pushing hard for another extension.

The bill also would exempt the $1.9 trillion COVID-19 relief bill from deficit-reducing requirements — known as PAYGO — that would otherwise trigger a 4% cut to Medicare payments and other federal programs unless Congress passes spending cuts by the end of the year.

The waiver is another priority for hospitals, but it’s unclear whether the Yarmuth bill can pass the Senate, where Democrats hold a narrow majority and need Republican support for passage.

The stickiest point for Republicans is the PAYGO waiver provision, which essentially would mean that the COVID-19 relief bill spending would not count toward the deficit.

Republicans balked at the size and cost of the most recent COVID-19 relief package and argued they were not given enough input over the bill’s contents, and oppose the PAYGO waiver for that reason. The COVID-19 relief bill was passed through reconciliation, a process that lets Congress quickly pass legislation but is inherently partisan as it only requires 51 votes to pass the Senate and is immune to filibuster rules.

“This could have all been avoided all together. We could have crafted a bipartisan package that did not trigger these automatic cuts,” Rep. Buddy Carter (R-Ga.) on the House floor Friday.

Democrats note that Republicans have waived PAYGO for their own priorities, including the 2017 tax reform bill, which was also done through reconciliation, to avoid cuts to Medicare and other programs. PAYGO was also waived for previous bipartisan COVID relief bills.

“Because PAYGO requirements cannot be changed in reconciliation bills, we knew from the outset this additional legislative fix was needed to avert painful and indiscriminate cuts to Medicare, farm supports and other programs,” Yarmuth said Friday on the House floor.

The partisan fighting could delay any action on a PAYGO waiver, which would need to be dealt with by the end of the fiscal year to prevent cuts from taking effect.

“My guess is right now, PAYGO falls to the wayside for the time being and Congress focuses on the 2% cut,” said a hospital industry lobbyist.

A Senate bill introduced by Sens. Jeanne Shaheen (D-N.H.) and Susan Collins (R-Maine) would only deal with the 2% Medicare cuts, pausing them through the public health emergency.

It’s not clear if that bill will get a vote in the Senate either. A spokesperson for Senate Majority Leader Chuck Schumer (D-N.Y.) didn’t respond for comment, but pausing the 2% sequester cuts during the pandemic has had bipartisan support.

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Marie Maynes
Marie Maynes is a Sports enthusiast and writes for the Sports section of ANH.