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Sluggish Hospital Job Growth Linked to Sequestration

John Commins, for HealthLeaders Media, August 5, 2013

Preliminary data from the Bureau of Labor Statistics marks July as the third month this year in which the hospital sector lost jobs. But one analyst is not ready to call it a trend.

With 2013 more than halfway completed, new federal data shows that hospital job growth has slowed considerably.

Caroline Steinberg, vice president, Health Trends Analysis at the American Hospital Association says the 2% cuts to Medicare mandated under the federal budget cuts known as sequestration are to blame.

"Medicare represents more than 40% of the care provided by hospitals and when you just lop off 2% of that, it's a big impact on hospitals," she says. "They have to provide the same amount of care they were providing before, but now instead of getting paid 92 cents on the dollar it's closer to 89 cents on the dollar. They were already losing money on Medicare and this makes it worse."

Bureau of Labor Statistics preliminary data marks July as the third month this year in which the hospital sector lost jobs, with 4,400 fewer jobs in July than in June. Since January, hospitals have created 1,700 new jobs. In the first seven months of 2012, hospitals created 38,600 jobs.

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