Wiki Medicare Advantage/2% Sequestration/Hospice

[clayjagod1]

I have a complicated issue that needs some guidance. Scenario: A provider treats a patient who is on a Hospice service for a non-Hospice related diagnosis. The patient had a Medicare Advantage plan prior to Hospice. The MA has a policy that if their member goes into Hospice, they will become secondary to traditional Medicare. So Medicare primary, MA secondary for a non-related Hospice diagnosis. Here's my issue: Medicare will deduct the required 2% sequestration amount. The claim is then sent to the secondary (MA plan). The MA plan then removes an additional 2% because they technically are still an MA plan even though they are secondary. So in essence, we have 4% removed from our claims when the Budget Reconciliation Act of 2011 states no more than 2% sequestration. I cannot get the MA plans to stop this practice nor have I found any information in the actual law regarding this scenario. This is adding up to a LOT of money since 2013. Please help.

Clay Jagodzinski, CPC

 

[thomas7331]

The regulations on how the sequestration should be calculated are pretty well spelled out by CMS, but I'm not sure I completely understand what you're seeing. As I understand it, the 2% should be applied to any payments issued by Medicare or the MA - it is the last calculation that takes place before the payment amount is determined, after applying fee schedule reductions and patient share. So in this case I would expect Medicare to deduct 2% from their final payment and the MA plan to do the same. That would be 2% of your total payments, not 4%. Or you do mean that the MA plan is reducing their payment by 2% of the amount that the primary payer allowed, and then reducing the cost-share again by an additional 2%? That would definitely be incorrect and something I would escalate through their network if you are contracted with the MA plan, or report to CMS if you are not, but it's hard for me to imagine how that could happen for so long and not be corrected. Can you provide an example of the dollar figures to illustrate what they're doing?