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Medicare Docs Brace for Sequester ‘Hit’

Spending cuts could mean billions of dollars in lost revenues (Feb. 26)

According to a report from MedPage Today, Medicare providers can expect to be smacked with $11 billion of the $85 billion in automatic federal spending cuts — called “sequestration” — that start Friday.

Medicare payments to providers will be cut by 2%, and most nondefense programs will be cut by about 8%, unless Congress can agree on other ways to reduce costs — which observers say is unlikely.

According to Health and Human Services (HHS) Secretary Kathleen Sebelius, the cuts would result in billions of dollars in lost revenues to Medicare physicians, hospitals, and other providers, who will be reimbursed at 98 cents on the dollar for their services to Medicare beneficiaries.

Medicaid and the Children's Health Insurance Program are exempt from the sequester.

As a result of the impending cuts:

  • The American Public Health Association (APHA) has said it plans to decrease immunization efforts, limit HIV testing and treatment, and eliminate positions for researchers investigating health care-associated infections.
  • The National Institutes of Health (NIH) may lose $1.6 billion by the end of the year, which could translate into delayed or terminated research grants.
  • The Health Resources and Services Administration (HRSA) expects to provide continuing education on women’s health, health disparities, obesity, and related topics to about 29,000 fewer practitioners through health education centers, and more than 5,000 fewer practitioners will be trained in geriatric education centers.
  • The Substance Abuse and Mental Health Services Administration (SAMHSA) has said that 1.1 million adults and children will risk losing public mental health support, and another 169,000 fewer individuals will be admitted to substance abuse treatment programs.
  • According to the National Association of Community Health Centers (NACHC), about 900,000 health-center patients could lose care as centers face a potential loss of $120 million.

Source: MedPage Today; February 26, 2013.

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