Noteworthy News

Report Calls for Billions in Hospital Cuts

A report by the Center for American Progress proposes billions of dollars in payment cuts to hospitals as a way of helping to prevent the country from falling off the fiscal cliff.

In its new report “The Senior Protection Plan:  $385 Billion in Health Care Savings Without Harming Beneficiaries,” the Center for American Progress proposes $61 billion in hospital payment cuts over the next ten years – cuts over and above those already enacted in the Affordable Care Act and other legislation of recent years. Among the proposals:  greatly reduced Medicare inpatient annual payment updates; the elimination of payment differentials between hospital outpatient facilities and physician offices; more expansive penalties for Medicare readmissions; reductions in Medicare bad debt reimbursement and graduate medical education payments; penalties for states that use large provider taxes to fund their Medicaid programs; and more.

These proposals, most of which have been offered by others in recent years, are considered especially important because the Obama administration frequently looks to the Center for American Progress for policy ideas.  The report was issued the same day that President Obama agreed to consider entitlement cuts if significant enhanced revenue was part of the overall approach to addressing the fiscal cliff crisis.

iStock_000015725011XSmallMany of the proposed cuts – the Medicare bad debt reimbursement cut, the graduate medical education cut, the additional readmissions penalties, and the Medicaid provider tax penalties – would be especially damaging to many urban safety-net hospitals.

Read more about these proposals in this Washington Post article or download the report itself from the web site of the Center for American Progress.

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