Medicare Reimbursement Faces Steep Cuts

The White House Office of Management and Budget projects that Medicare providers would see reductions of about $11 billion beginning in January as part of series of automatic spending cuts unless Congress acts to halt them. The information on the Medicare cuts is part of the report that details how the federal government would implement across-the-board budget cuts agreed to by Congress and President Barack Obama last August as a way to end a bitterly partisan dispute over raising the debt ceiling.

The automatic cuts, called sequestration, would trim federal spending by $2.1 trillion over the next 10 years. While Medicare benefits would not change, hospitals and providers would see an across the board two percent reimbursement cut through sequestration. This two percent cut is in addition to the nearly 30 percent cut looming in January from the Medicare Sustainable Growth Rate (SGR).

The OSMA joined the American Medical Association (AMA) along with more than 100 other state and national medical associations in urging leaders in the U.S House and Senate to avoid the cuts from the sequestration and the SGR. Both major political parties want to avoid the cuts but must agree on a compromise in order to do so.

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