Fiscal Cliff Talks Leave Hospitals Wondering

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Jan. 3, 2013, has become a major deadline for the entire country as President Barack Obama and leaders in Congress try to avert the "fiscal cliff," also known as the sequestration plan.

If President Obama and Congress are not able to agree to a new deal to reduce the nation's deficit, the automatic cuts will be triggered — many of which will heavily impact the hospital and healthcare sector.

In September, the Office of Management and Budget said sequestration would lead to roughly $11.1 billion in Medicare payment cuts to hospitals and other providers in 2013, and Medicare providers stand to lose upwards of $120 billion over the next decade.

Both Democrats and Republicans have indicated that sequestration is not the desired path, but both sides have also pitched ideological camps. Democrats have said they do not want cuts to entitlement programs, specifically Medicare and Social Security, but they do encourage revenue increases through higher taxes on the wealthy. Many Republicans have said they do not want legislation that "violates their promises to never raise tax rates," according to a report from The Hill, and they also believe all federal programs should be up for cuts.

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The American Hospital Association has said it opposed any and all cuts to the Medicare program, which it argued would lead to longer wait times, fewer doctors and nurses to give care and less patient access. Specifically, the AHA has urged Congress to avoid the following changes:

•    Cuts to payments for evaluation and management services in hospital outpatient departments.
•    Reductions in graduate medical education payments.
•    Across-the-board cuts to Medicare inpatient hospital rates through coding adjustments.
•    Payment reductions to rural hospital programs.

President Obama, House Speaker John Boehner (R-Ohio) and Senate Majority Leader Harry Reid (D-Nev.) are the major players in the fiscal cliff talks. The parties will convene again this week to continue talks, although there is no indication a deal will be struck in the next couple weeks.

More Articles on Healthcare Funding:

Straight Talk on Medicare: A Go-To Guide for Hospital Executives

6 Scariest Issues in Healthcare Right Now

Hospitals, Providers to Lose $11.1B From Medicare Sequestration Cuts

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