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Fiscal Cliff Stopgap Delays 'Doc Fix,' but Hits Hospitals

John Commins, for HealthLeaders Media, January 3, 2013

Impact on Patient Population
That sentiment was echoed by Bruce Siegel, MD, president/CEO of the National Association of Public Hospitals and Health Systems. Under the Act, safety net hospitals and other providers with larger Medicaid populations will see cuts to their disproportionate share payments totaling about $4.2 billion over 10 years.

"While this agreement averts severe economic hardships for the nation, it nonetheless puts at risk essential healthcare for millions of vulnerable people," Siegel said in prepared remarks. "Solving one side of the provider equation must not come at the expense of the other—particularly the hospitals and health systems that care for a disproportionate share of Medicaid and other low-income patients."

Beyond the SGR extension and further "adjustments" for other Medicare and Medicaid providers, the legislation only delays until March 1 additional and sweeping cuts mandated by the so-called Sequestration.

Those reductions include across-the-board cuts of 9.4% for defense spending, 8.2% for non-defense spending, and 2% for Medicare payments. Those cuts come due right as Congress and the Obama administration debate another extension of the federal debt ceiling.

"It certainly looks like a stopgap measure. Hurry up and wait until the end of February when we hit the debt ceiling again, and we have to figure what to do again," says Bill Copeland, a healthcare consultant with Deloitte LLP.

He says there is nothing to indicate that anything will change in the next two months that would lend itself to a longer-term solution.

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1 comments on "Fiscal Cliff Stopgap Delays 'Doc Fix,' but Hits Hospitals"


flpoggio (1/3/2013 at 5:47 PM)
Robbing Peter to pay Paul...now that's a unique way to get doctors and hospitals to work closer together. While one federal agency is spending billions to promote and reward ACOs another is driving a wedge between them. Does that sounds like a winning startegy?