Senate Votes to Extend Hospice Payment Sequestration Suspension

The U.S. Senate has voted to extend the moratorium on Medicare payment sequestration for hospice and other health care organizations through the end of the year. The Senate bill must now go to the House, which is unlikely to pass the legislation before the current expiration date of March 31.

The Senate approved the bill with 90 votes in favor and two against. The bill is similar to one passed by the House last week, but the two pieces of legislation are not the same, meaning the lower chamber must take it up. However, the House will be in recess until mid-April.

“At a time when our country is relying so heavily on our health care providers to help get us back to normal, we cannot ignore the financial realities they face,” said Sen. Susan Collins (R-Maine), a sponsor of the bill. “I am pleased that the Senate passed this legislation [Sen. Jeanne Shaheen (D-N.H.)] and I authored that will extend the current sequester moratorium until the end of the year. This financial certainty is desperately needed in these uncertain times.”


The House is expected to approve the bill when it returns from recess. The gap in time could lead the U.S. Centers for Medicare & Medicaid Services (CMS) to delay some payments if the agency does not have clear direction from Congress regarding sequestration. Thus far, CMS has not indicated how it will address sequestration in the interim.

Sequestration was established in 2014 by the Budget Control Act. The practice reduced payments to hospice and other health care providers by 2% across the board.

Under current law, hospice providers must return payments to CMS if the total paid exceeds the Medicare payment cap allowance. CMS includes the sequestered 2% as part of the total, even though hospices do not receive those funds.


Last year, Congress temporarily suspended sequestration via the CARES Act, providing hospices with much-needed relief. The pandemic has been hurting hospices financially since it began. Nearly 60% of respondents to a National Association for Home Care & Hospice survey said they expected their annual revenues to take a significant hit due to the coronavirus outbreak.

Providers have contended with declines in hospice patient admissions and referrals amid the public health emergency, as well as increased paid leave and paid time off for staff and skyrocketing costs for personal protective equipment and supplies.

“Health care providers have suffered significant financial losses while responding to this pandemic in the communities they serve,” said legislative co-sponsor Shaheen. “The last thing they need are cuts to federal funding they are relying on, like Medicare reimbursement payments, that are helping them keep the doors open and deal with increased expenses and revenue shortfalls during COVID-19.”

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