House Passes Budget Agreement and Averts 24% Cuts to Medicare Outpatient Payments

December 17, 2013

The House of Representatives has approved a budget agreement that sets the federal government’s 2014 spending limits and provides 2 years of targeted relief from sequestration cuts. Attached to the budget deal was a provision that would provide for a 3-month extension of the current Medicare rates through March 2014. The patch increases Medicare fee schedule payment amounts for the first 3 months of 2014 by 0.5%. However, the 2% cut imposed by sequestration and already factored into the 2014 rates remains in effect. The patch also extended the current therapy cap exceptions process for 3 months.

The Senate is expected to consider the budget deal as well as a potential patch for the sustainable growth rate (SGR) formula early next week.


Representative Paul Ryan (R-WI), Chairman of the House Budget Committee, and Senator Patty Murray (D-WA), Chairwoman of the Senate Budget Committee, announced earlier in the week that they had reached an agreement to temporarily suspend the sequester and set budget levels for fiscal years (FY) 2014 and 2015. That means that there will be no automatic across-the-board cuts in fiscal FY 2014 (October 1, 2013--September 30, 2014) and FY 2015 (October 1, 2014–September 30, 2015). Instead, total spending figures for both years have been proposed that would increase both defense and nondefense discretionary spending, while—at the same time—proposing a long list of mandatory savings that would result in a net savings to the government over 10 years. The agreement, soon to be voted on by the House and Senate, would restore 87% of the funding slated for automatic cuts under the sequester for 2014 and 2015. For nondefense discretionary spending, including federal education programs such as IDEA and Title I, there will be an additional $22.3 billion available in FY 2014 and $9.3 billion in FY 2015. Congressional appropriators will have to decide how to divvy up the additional funding among the various discretionary accounts.

The House Rules Committee approved the inclusion of a 3-month SGR fix that will ensure that Medicare reimbursement rates remain at the 2014 levels.


ASHA Resources

For questions related to the budget, please contact Neil Snyder, ASHA’s director of federal advocacy, at For questions related to legislative proposals associated with the SGR and therapy caps, please contact Ingrida Lusis, ASHA’s director of federal and political advocacy, at

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