Revenue Cycle Management Blog | GroupOne Health Source

Effect of Government Shutdown on Medicare

Written by Kaitlyn Houseman | October 1, 2013

The federal Fiscal Year runs from October 1 through September 30th.  This means that Fiscal Year 2014 begins today on Tuesday, October 1.  In order for the government to operate, the Congress must pass and the President must sign appropriations bills that release the money necessary to fund the operation of the federal government. 

To date, not a single one of the 12 appropriations bills required to fund the government have been signed into law.  Among other things, this means that as of midnight tonight, there is technically no money available to pay the salaries of federal employees (including Members of Congress and their staff), pay the utility bills for government buildings or fund grants made by the federal government.

In lieu of enacting 12 separate appropriations bills, the Congress is debating the approval of what is called a "Continuing Resolution" or CR.  This is legislation that effectively extends the 2013 Fiscal Year for whatever amount of time the Congress and President agree to "continue" operations.  A CR can be anywhere from a single day to a full year. 

As you have not doubt been hearing, Congress could not reach an agreement before midnight, last night. The effect of this will be that all "non-essential" federal employees will be told that they don't need to show up for work October 1.     

This has raised questions about the ability of the Medicare program to process Medicare claims after October 1, 2013 in the event the impasse persists and a government shut-down occurs.

Because the money used to pay Medicare benefits is not subject to the appropriations process (it is an entitlement program not a discretionary program) and the processing of Medicare claims is deemed "essential," the Centers for Medicaid and Medicaid (CMS) has announced that there should be no disruption in the processing and payment of Medicare claims.  In fact, most CMS activities of will continue despite the appropriations impasse.

According to a recent announcement by the Department of Health and Human Services (HHS), the parent agency for CMS, the only CMS activities adversely affected by a government shutdown would be: 

  • CMS would be temporarily suspend funding for the healthcare fraud and abuse strike force teams; and,
  • CMS would conduct fewer re-certifications and initial certifications for providers subject to Medicare survey and certification.

Finally, it should be noted that this appropriations impasse is unrelated to the upcoming Debt Limit debate that will ensue in a few weeks. Like the Appropriations problem, the failure of the Congress and the President to agree on legislation raising the Debt Limit could also result in a government shutdown.

By: HBMA GR Committee