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Medicare Cuts Threaten 766K Healthcare Jobs, Groups Say

John Commins, for HealthLeaders Media, September 13, 2012

She says that multiplier effect could also work in reverse for thousands of hospitals and the communities they serve across the nation if the cuts go through.

"When you cut Medicare funding Medicare hospitals will have less reimbursements coming in. They will have to lower their expenses and some of that will be through staff reductions. That is the direct effect," Steinberg says. "And part of that direct effect is that hospitals will reduce spending on other supplies and services."

"The indirect effect would be when the hospitals reduce their spending on other supplies and services and other businesses are affected," she says. "If a hospital reduces spending on laundry or food service or medical devices or drugs those companies will in turn have to reduce their expenditures, which could result in staff layoffs."

Finally, Steinberg says, there is the "induced effect" of the loss of revenue for people who've lost their jobs either at a hospital, or supplier. "They are then going to reduce their purchases in their community, which will cause additional business, restaurants, clothing stores, car dealerships, to have less revenue coming in, which will lead to more job losses," she says.

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5 comments on "Medicare Cuts Threaten 766K Healthcare Jobs, Groups Say"


Joan Benson RN (9/17/2012 at 10:10 PM)
I agree with Judy RN,trying to make money off the ill is sad,and lets not mention the healthcare disparities,duplication of test, and delayed treatments that goes on in some of these hospitals. EVERYONE should have the same quality of care, whether you have one million or one dollar. Hopefully if there are cuts they will start at the enormous top heavy hospital administration, since many have the highest paid salaries and the rest could be used for providing quality patient care!

Stephanie Newell (9/17/2012 at 1:46 AM)
According to this article, in summation, healthcare access will be significantly diminished to the masses due to the revenue cuts. Is this not complete opposition of what had been promised? President Obama has promised everyone will be covered by health insurance. That is fabulous. However, if you take away the providers by cutting jobs, then what good has come from making sure everyone has health insurance? This is epitome of robbing from Peter to pay Paul. The icing in the cake is we'll be insured to have no healthcare providers .

Todd Madden (9/16/2012 at 10:21 AM)
So by Steinberg's logic we should raise taxes as much as possible so that everyone has a job. Lets shoot for 0% unemployment. Good luck with that. Also, should we just pursue another failing "Buy America" campaign? I mean if a GE MRI is made in Florence, SC and used in a Sacramento, CA hospital, that is ok but a product sourced from Mexico, China or India is bad even if it saved significant money? Her argument has about as many holes as swiss cheese.