112 
‘‘Vocational Rehabilitation and Education Di-
rect Loan Financing Account (36–4259–0–3–702). 
‘‘(h) MILITARY HEALTH
AND RETIREMENT.—To 
achieve the total percentage reduction in military retire-
ment required by any order issued under this part, the 
percentage reduction that shall apply to payments under 
the Military retirement fund (97–8097–0–7–602), pay-
ments to the military retirement fund (97–0040–0–1– 
054), and the Defense Health Program (97–0130–0–1– 
051) shall in no event exceed 2 percent. 
‘‘(i) MEDICARE PROGRAM.— 
‘‘(1) CALCULATION
OF
REDUCTION
IN
INDI-
VIDUAL PAYMENT AMOUNTS.—To achieve the total 
percentage reduction in those programs required by 
any order issued under this part, the percentage re-
duction that shall apply to payments under the 
health insurance programs under title XVIII of the 
Social Security Act (other than payments described 
in section 255(a)(2)) that are subject to such order 
for services furnished after any sequestration order 
is issued shall be such that the reduction made in 
payments under that order shall achieve the required 
total percentage reduction in those payments for 
that fiscal year as determined on a 12-month basis. 
However, the percentage reduction under any such
113 
program shall in no case exceed 2 percent under any 
sequestration order. 
‘‘(2) TIMING
OF
APPLICATION
OF
REDUC-
TIONS.—If a reduction is made under paragraph (1) 
in payment amounts pursuant to a sequestration 
order, the reduction shall be applied to payment for 
services furnished after the effective date of the 
order. 
‘‘(3) NO INCREASE IN BENEFICIARY CHARGES 
IN ASSIGNMENT-RELATED CASES.—If a reduction in 
payment amounts is made under paragraph (1) for 
services for which payment under part B of title 
XVIII of the Social Security Act is made on the 
basis of an assignment described in section 
1842(b)(3)(B)(ii), 
in 
accordance 
with 
section 
1842(b)(6)(B), or under the procedure described in 
section 1870(f)(1) of such Act, the person furnishing 
the services shall be considered to have accepted 
payment of the reasonable charge for the services, 
less any reduction in payment amount made pursu-
ant to a sequestration order, as payment in full. 
‘‘(4) APPLICATION TO PARTS C AND D.—The 
reductions otherwise required under parts C and D 
of title XVIII of the Social Security Act with respect 
to a fiscal year shall be applied to the calendar year
114 
that begins after the end of the fiscal year to which 
the applicable sequestration order applies. 
‘‘(j) FEDERAL PAY.— 
‘‘(1) IN GENERAL.—For purposes of any order 
issued under section 254, new budget authority to 
pay Federal personnel shall be reduced by the appli-
cable uniform percentage, but no sequestration order 
may reduce or have the effect of reducing the rate 
of pay to which any individual is entitled under any 
statutory pay system (as increased by any amount 
payable under section 5304 of title 5, United States 
Code, or section 302 of the Federal Employees Pay 
Comparability Act of 1990) or the rate of any ele-
ment of military pay to which any individual is enti-
tled under title 37, United States Code, or any in-
crease in rates of pay which is scheduled to take ef-
fect under section 5303 of title 5, United States 
Code, section 1009 of title 37, United States Code, 
or any other provision of law. 
‘‘(2) DEFINITIONS.—For purposes of this sub-
section: 
‘‘(A) The term ‘statutory pay system’ shall 
have the meaning given that term in section 
5302(1) of title 5, United States Code.
115 
‘‘(B) The term ‘elements of military pay’ 
means— 
‘‘(i) the elements of compensation of 
members of the uniformed services speci-
fied in section 1009 of title 37, United 
States Code, 
‘‘(ii) allowances provided members of 
the uniformed services under sections 403a 
and 405 of such title, and 
‘‘(iii) cadet pay and midshipman pay 
under section 203(c) of such title. 
‘‘(C) The term ‘uniformed services’ shall 
have the meaning given that term in section 
101(3) of title 37, United States Code. 
‘‘(k) CHILD SUPPORT ENFORCEMENT PROGRAM.— 
Any sequestration order shall accomplish the full amount 
of any required reduction in expenditures under sections 
455 and 458 of the Social Security Act by reducing the 
Federal matching rate for State administrative costs 
under such program, as specified (for the fiscal year in-
volved) in section 455(a) of such Act, to the extent nec-
essary to reduce such expenditures by that amount. 
‘‘(l) EXTENDED UNEMPLOYMENT COMPENSATION.— 
(1) A State may reduce each weekly benefit payment made 
under the Federal-State Extended Unemployment Com-