What is “sequestration reduction” in medical billing?

Sequestration Reduction in Medical Billing

Sequestration reduction refers to a mandatory reduction in Medicare payments to providers, part of federal budget cuts.

Sequestration Reduction in Medical Billing Explained

In medical billing, sequestration reductions are applied to Medicare payments, reducing the total reimbursement by a specific percentage. Providers must account for these reductions in their revenue calculations.

For example, a provider’s Medicare payment for a service is reduced by 2% due to sequestration cuts.

See common acronyms and abbreviations in Medical billing glossary.

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