According to Medicare officials, the agency will not process any payments to physicians until July 15th at the earliest, leaving the congressionally mandated 10.6% reimbursement reduction in limbo.

"We are not going to process any claims for health care services for the first 10 business days of July," says a spokesperson for the Centers for Medicare and Medicaid Services (CMS). "This means that by holding these claims that are delivered on or after July 1, CMS will not be making any payments on the 10.6% reduction until July 15, at the earliest."

CMS issued the statement after conflicting reports about the CMS action were published over the weekend. The Washington Post reported that Medicare would freeze payments to physicians at the June 30 level, while the New York Times reported that Medicare would hold all payments for 10 days.

The decision means that the 10.6% cut is essentially on hold, but if Congress doesn’t step in with a fix when it returns after the July Fourth holiday, doctors can expect to be paid for July billings at the lower rate.

Congress seemed on track to deliver a last-minute fix when the House approved a bill that would have blocked the pay cut by a vote of 355 to 59.

However, a plan to stop the scheduled fee cut was derailed by Senate Republicans during a long and contentious late-night Senate session.

Nancy H. Nielsen, MD, president of the American Medical Association, and a Buffalo, NY, internist, accused the Senate Republicans of following the "direction of the Bush administration" by voting to "protect health insurance companies at the expense of America’s seniors, disabled, and military families."

The AMA has long argued that physicians would respond to any cut in physician reimbursements by limiting the number of the Medicare patients they accept in their practices.

Over the past decade that argument has resonated with Congress, as, year after year, it took last-minute action to block automatic cutbacks in physician payment dictated by the program’s formula.

That’s what happened in December, but the legislation carried the reprieve only until July 1st.

[MedPage Today, June 30, 2008]