AHA urges Congress to act on PAYGO sequester cuts, prevent $38B Medicare blow

The American Hospital Association was one of seven national healthcare organizations that wrote a Nov. 30 letter to Congress asking to stop the 4 percent statutory Pay-As-You-Go sequester from taking effect in January.

For hospitals and health systems, this financial year is lining up to be one of the most challenging in decades. Inflation challenges and rising costs from workforce shortages, drugs, equipment and supplies are threatening the financial stability of many organizations and their ability to provide access to high-quality care. 

These challenges are exacerbated by supply chain shortages, backlogs in deferred care and government underpayment, according to the AHA, which estimated that failure to waive the statutory PAYGO sequester cuts would result in $38 billion in Medicare cuts in fiscal year 2023.

"In previous years Congress has stepped in to pass legislation to avoid triggering PAYGO. Congress once again needs to waive these cuts, to prevent them from taking effect in 2023," the healthcare groups wrote in the letter. "We urge Congress to prevent these cuts. Now is not the time for reductions in Medicare payments to providers."

The letter was also signed by the American Medical Association, American Health Care Association, National Association for Home Care & Hospice, National Hospice and Palliative Care Organization, Association for Clinical Oncology and AdvaMed.

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