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Medicare Blog | Medicare News | Medicare Information

The Fiscal-Cliff and Medicare

Posted by Lauren Hidalgo on Fri, Jan 04, 2013 @ 01:14 PM

Medicare Supplements On Tuesday, Congress passed a deal to avoid the fiscal cliff called the American Taxpayer Relief Act of 2012. This bill delayed the budget sequestration by two months in order to give more time for negotiations between the parties on how to reduce the deficit. This highly controversial bill still leaves several unresolved budget issues, including cuts to Medicare and Medicare payments. It also fails to address the required increase to the national debt ceiling.

Some of the highlights included in the American Taxpayer Relief Act of 2012 are:
(for a full list, go here)

  • Medicare Advantage, health plans, hospitals, and dialysis centers were hit the hardest with payment cuts. Physicians, pharmacies, and other providers also saw large reductions.

  • Physicians avoided a 26.5 percent cut that is required under the Sustainable Growth Rate (SGR) formula. Also, 2013 will be another year without any Medicare rate increases.*

  • The law sets up another SGR physician rate cut for January 2014. Congress “punted” again because it’s easier for them to find $25 billion to delay the SGR cuts than it is for them to find $300 billion to repeal the formula altogether.

  • State run Medicaid will see a $4.2 billion federal funding cut in 2022 for safety-net hospitals that serve a disproportionate low-income and uninsured population.

  • Several special programs and add-on payments extended

CEOs, economists, and President Obama all agree that the fiscal cliff deal is barely a start, and while it has several breakthroughs, it also has several things it fails to do. There are two ways to look at the battle over the “fiscal cliff.” The first is the short term, limiting damage to the already weakened economy. The other is the long term, determining the shape of the government for years to come. Many more discussions and negotiations will be taking place in the upcoming months as Congress works to reach an agreement.

*This bill does not include an increase to Medicare.

Please give us your feedback!
What do you think of the things Congress has done so far in relation to the fiscal-cliff? What other changes do you think their discussion will bring to Medicare?

 

Source: Piper Report

Additional Updates:

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