Sequestration is a budget technique characterized by the implementation of automatic mandatory spending cuts if deficit levels exceed a certain threshold. The Budget Control Act of 2011 utilized sequestration to... more +
Sequestration is a budget technique characterized by the implementation of automatic mandatory spending cuts if deficit levels exceed a certain threshold. The Budget Control Act of 2011 utilized sequestration to encourage Congress to cut federal spending by 1.2 billion dollars. If Congress fails to make the specified funding cuts, sequestration will kick in and  automatic cuts will be made to the federal budget. A good portion of the slated cuts will come from the national security budget.  less -
News & Analysis as of

Bipartisan Budget Law Extends Medicare Sequestration, Includes Medicaid Drug Rebate, Off-Campus Hospital Outpatient Department,...

On November 2, 2015, President Obama signed into law H.R. 1314, the “Bipartisan Budget Act of 2015” (BBA). The two-year, $80 billion budget/debt-ceiling deal is funded in part by several significant Medicare and Medicaid...more

PilieroMazza Legal Advisor - Fourth Quarter 2015

More Small Business Subcontracting Plan Changes: SBA Proposes to Allow Subcontracting Plan Credit for Small Business Subcontractors at any Tier - Following recent proposed changes to the FAR’s small business...more

Budget Deal to Limit Provider-Based Status, Extend Sequestration

On October 28 and 30, 2015, the U.S. House of Representatives and U.S. Senate approved the Bipartisan Budget Act of 2015 (the Act)—a measure designed to raise the limit on Federal borrowing that would also have significant...more

Congress Take Step Toward Site-Neutral Medicare Payments in Bipartisan Budget Act of 2015

On October 28, 2015, the U.S. House of Representatives approved legislation that, if enacted, would, among other things, substantially alter how and how much Medicare pays for outpatient services furnished by hospitals. The...more

Pending Budget Deal Includes Medicare Sequestration Extension, Other Medicare/Medicaid Cuts

Outgoing House Speaker John Boehner and the Obama Administration have reached agreement on a two-year, $80 billion budget/debt-ceiling deal that includes Medicare and Medicaid “offsets” to finance other spending. For...more

Treasury Announces Decrease in Cash Grant Sequestration Rate from 7.3% to 6.8%

The Department of the Treasury has announced that, for fiscal year 2016, the Cash Grant1 sequestration rate has decreased from 7.3 percent to 6.8 percent. ...more

Food and Beverage Alert (US)

Former food executive faces possible life sentence for salmonella outbreak. The possible fate of Stewart Parnell, a former president of the Peanut Corporation of America, is being discussed in media worldwide. Federal...more

State and local governments continue to see a reduction in credits available for Direct Pay Bonds

As a result of federal sequestration, state and local governments who have issued certain direct pay bonds have seen a reduction in tax subsidy payments since March 1, 2013. Sequestration is a result of Congress’ failure to...more

FY 2016 Sequestration Reduction Percentage for Direct Pay Tax Credit Bonds Set at 6.8 Percent

According to an update released by The IRS Office of Tax Exempt Bonds (TEB), the sequester reduction percentage applied to the payments made to issuers of direct pay bonds in FY 2016 will be 6.8 percent. This percentage will...more

Hospice Cap Demand Group Appeal Deadline

As you likely are aware, Medicare hospice payments were reduced by two percent in accordance with a sequestration order issued March 1, 2013, pursuant to Section 251A of the Balanced Budget and Emergency Deficit Control Act....more

House Rejects Contentious Trade Bill that Was Vehicle for Extension of Medicare Sequestration

As previously reported, Congress has been considering financing Trade Adjustment Assistance (TAA) reauthorization legislation in part through future Medicare provider cuts. Specifically, as approved by the Senate on May 22,...more

Pennsylvania Hospitals Successfully Challenge Sequestration Reductions

In a case of first impression, a Pennsylvania court recently ruled in favor of 12 independent community hospitals (the “Hospitals”) that sued health insurer Highmark Inc. (“Highmark”) for passing on its 2 percent Medicare...more

Insurer Wrongfully Passed Sequestration Cuts Through to Providers

A Pennsylvania judge found, on May 6, 2015, that a Medicare Advantage Plan had no right under its participation agreements to pass CMS sequestration reductions through to participating providers. Judge R. Stanton Wettick Jr....more

Key Energy-Related Tax Provisions in the 2016 Budget Proposal

In This Issue: - Modify and Permanently Extend the Production Tax Credit - Enhance and Make Permanent the Research and Experimentation Tax Credit - Provide Carbon Dioxide Investment and Sequestration Tax...more

Locke Lord QuickStudy: February 2015 Update on Federal Budget Sequestration Affecting Build America Bonds and Other Direct Pay...

As we have noted in previous client advisories, under current law, direct pay bond subsidy payments are subject to federal budgetary sequestration through fiscal year 2024. On February 2, 2015, the Office of Management and...more

President Obama Releases 2016 Budget Proposal Ending Sequester Cuts

On February 2, 2015, President Barack Obama delivered his Fiscal Year 2016 budget proposal to Congress. The $4.066 trillion budget contains a sequestration replacement plan that would allow a 7%, or $75 billion, increase in...more

Congress Extends QZABs, New Markets Tax Credits; Continuing Effect of Sequestration

Qualified Zone Academy Bonds - The Act authorizes the Secretary of the Treasury to allocate an additional $400 million in QZABs for 2014. Prior to the Act, no additional allocations of QZABs were to be available to the...more

FY 2015 Sequestration Reduction Percentage for Direct Pay Tax Credit Bonds Bumps Up to 7.3 Percent

According to an update released by The IRS Office of Tax Exempt Bonds (TEB), the sequester reduction percentage applied to the payments made to issuers of direct pay bonds in FY 2015 will be 7.3 percent. This new percentage...more

Pennsylvania Hospitals Challenge Medicare Advantage Plan’s Sequestration Adjustment

On September 22, 2014, twelve hospitals filed a complaint in a Pennsylvania state court against a Medicare Advantage plan, Highmark, Inc., along with its HMO subsidiary, for implementing a two-percent reduction to the...more

Cash Grant Sequester Rate Increased From 7.2 to 7.3 Percent for Fiscal Year 2015

The Department of the Treasury has announced that for fiscal year 2015 the Cash Grant sequester rate will be increased from 7.2 to 7.3 percent. The announcement is available below. The change applies to Cash Grants paid on...more

IRS Issues Notice on the Cash Grant Sequestration and Tax Attributes

Yesterday, the IRS issued a notice confirming the effects of the Cash Grant sequestration with respect to the tax attributes associated with the renewable energy projects that received the Cash Grant. Notice 2014-39 is...more

May 2014: Trial Practice Update: Courts, Lawmakers, and Other Groups Grapple with Juror Misuse of Social Media and the Internet

Jurors are expected to decide cases based on evidence they see and hear in the courtroom, after deliberating while sequestered from outside influences. For decades, courts have enforced rules and practices designed to make...more

Government Contracts Quarterly Update - May 2014

The Government Contracts Quarterly Update is published by BakerHostetler’s Government Contracts Practice Group to inform our clients and friends of the latest developments in federal government contracting. In This...more

CMS Further Clarifies that Contract Language Determines Whether Sequestration Adjustments Apply to Part C Provider Payments

In an April 17, 2014 letter to the American Hospital Association, CMS Administrator Marilyn Tavenner stated that whether “sequestration might affect a [Medicare Advantage plan’s] payments to its contracted providers [is]...more

Weekly Update Newsletter - April 2014 #4

In this issue: - DOD, GSA, and NASA Issue Proposed Rule to Amend FAR Incorporating Section K in Contracts - DOD Issues Final Rule to Amend DFARS Contracting Officer’s Representative (DFAR Case...more

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