Hospitals urge Congress to delay $36B in Medicare cuts

The Federation of American Hospitals urged Congress to waive a mandatory 4 percent Medicare spending cut before it takes effect.

The hospital association sent letters to lawmakers Aug. 31, urging them to address the statutory Pay-As-You-Go cuts as part of an upcoming government funding package that must be passed before current funding expires Sept. 30.

The FAH said without action on PAYGO, the cuts will result in an estimated loss of $36 billion in funding in 2022 alone.

"Failure to act on PAYGO before year end will result in a mandatory cut in Medicare spending of four percentage points, which is simply unsustainable for hospitals and health care providers still battling COVID- 19," the federation said.

The letter says that the 4 percent cut due to PAYGO, resulting from the American Rescue Plan Act, will only be exacerbated by the 2 percent Medicare sequestration moratorium that is slated to occur Dec. 31. Together, providers could face a 6 percent cut to Medicare payments to start 2022. 

"Such extreme cuts would have a long-lasting and devastating impact on healthcare providers and patients alike, which is unconscionable amid a public health crisis," the federation said. 

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