Hospitals considering options as sequester cuts will continue

With the recent budget accord apparently excluding the Medicare program from restored sequester-related cuts, hospitals are mulling both their lobbying and financial options, the San Diego Union-Tribune reported.

The proposed bipartisan budget deal extends the 2 percent cut in Medicare payments to hospitals until 2023. However, it also delays proposed cuts in payments to disproportionate share hospitals, as well as potential steep cuts in payments to physicians under the sustainable growth rate formula.

"Healthcare has, because of the Affordable Care Act, already had significant impacts and significant cuts. Continuation of the sequestration, if it passes, will just add to what we've been dealing with since the law passed," Mike Murphy, chief executive officer of Sharp Healthcare, San Diego's largest hospital system, told the Union-Tribune.

Scripps Health, the San Diego-based hospital system has held a variety of administrative positions open as a result of the 2 percent across-the-board sequester cuts that also impacted Medicare. Scripps Chief Executive Officer Chris Van Gorder said excluding Medicare from the budget deal could eventually impact patient care.

"I think, over time, patients are going to experience more difficulty getting an appointment and they may have to travel further to be seen," Van Gorder told the newspaper.

The sequester, which was initiated earlier this year as part of a stopgap budget compromise, affected pretty much every level of spending in the federal government. Although most providers have made do with the reduced reimbursements, it did cause a brief scare among cancer clinics that treat significant numbers of Medicare enrollees.

Chapin White of the Center for Studying Health System Change said that hospitals have few options in terms of cost-shifting their Medicare revenue cuts over to private insurers. He called that particular practice a "myth," according to the Union-Tribune.

To learn more:
- read the San Diego Union-Tribune article

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