This article appears in the January 2012 issue of HealthLeaders magazine.
Editor's note: This piece is based on Karen Minich-Pourshadi's November 28, 2011, online column, Super Committee's Failure Will Affect Capital Planning.
What does the Congressional Super Committee's failure to come to consensus on a deficit reduction plan mean for healthcare finance leaders? For starters, CFOs will be taking a hard look at large capital spend projects in 2012 and beyond.
When leaders of the Joint Select Committee on Deficit Reduction, charged with finding at least $1.2 trillion in deficit reductions, failed last November to reach agreement on budgetary cuts, that inaction triggered automatic cuts to a broad range of domestic programs, such as Medicare, starting in 2013. The impasse is expected to reverberate through the economy. Economists and politicians agree that the lack of consensus on a debt reduction plan could slow economic growth significantly.
What's more, no swift solution is in sight. "There will be no easy off-ramps on this one," President Obama said. He has pledged to veto any legislation that would stop the automatic cuts.