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Wednesday, September 26, 2012

Hospitals Could Face More Medicare Cuts Next Year, Attorney Says

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Hospitals may find their Medicare reimbursement on the chopping block again in 2013 as Congress and the White House look for ways to cut the federal budget deficit, according to a California attorney.

The Affordable Care Act reduced hospitals' Medicare reimbursement by about $150 billion over 10 years in exchange for providers getting more paying customers from expanded insurance coverage. Since hospitals comprise the largest chunk of Medicare spending, they may be targeted for further reductions next year in a deal to cut the federal budget, John Hellow, an attorney with Hooper, Lundy & Bookman, Los Angeles, who represents providers, told me recently.

"It's all about who's got the bull's-eye on their back," he said.

At a minimum, Hellow expects hospitals will have to contribute funding to cancel a scheduled 27 percent cut in Medicare payments to physicians due to be implemented Jan. 1, 2013. But the cuts could be much larger if Congress needs to find more funding for a budget deal, he added. "It doesn't take a lot of political will" by Democrats and Republicans to reduce providers' annual payment increases, he said.

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