Posts Tagged ‘CMS’

Details of Health Care Cuts and Spending in 2013 Federal Budget

February 14, 2012 Leave a comment

The Obama Administration has recently presented its 2013 Budget proposal to Congress. According to the White House and HHS websites, healthcare is expected to be effected in the following ways:


$362 billion in cuts to Medicare and Medicaid over 10 years

Drug companies to provide $156 billion in discounts on top of $80 billion in discounts used to pay for healthcare reform legislation

$63 billion in cuts to long-term care facilities (i.e. Kindred Healthcare)

$177 million cut to Children’s Hospital Graduate Medical Education programs

$327 million cut to Community Services and Preventive Health grants


Medicare spending to increase by $45 billion in 2013 and total $523 billion.  Seniors to see premiums go up in order to save $28 billion by 2022.


$385 billion in savings for Medicare and Medicaid over 10 years


$1 billion additional for implementation of healthcare reform

$2 billion for Administration on Aging

$599 million for “effectiveness” research

$8 billion for Head Start


$1 trillion in new taxes (Buffet rule, etc)


200,0000 pharma jobs to be lost according to Pharmaceutical Research and Manufacturers of America Association

278,000 hospital jobs to be lost according to American Hospital Association


U.S. Debt Committee Proposes 20-30% Cuts to Medicare and Medicaid

November 17, 2011 Leave a comment

The U.S. Congressional Joint Committee on Deficit Reduction has proposed a 20-30% combined cut to Medicare/Medicaid. The committee specifically plans to cut $300 billion from Medicare/Medicaid over the next 10 years. Senators on the U.S. Senate Finance Committee have said that the cuts are necessary and have to be done to get rid of all of the fraud committed by UnitedHealthcare, Humana, Cigna, Aetna, and Blue Cross/Blue Shield. Even if the Committee fails to reach a deal next week, automatic 2% cuts to Medicare/Medicaid will still have a major affect on physician practices and hospitals. Tennessee Hospital Association CEO Craig Becker says “if you’re looking at a 2o percent to 30 percent cut in medicare and medicaid funding, there’s no way some of them can take that.” Mr. Becker is absolutely right. Non-profit facilities will suffer and for-profits will suffer just as much. Tenet has publicly said that the sequestration would result in a $40-$54 million loss on EBITDA (cash flow). United Health Systems has said sequestration would reduce EBITDA  by $36.6 million over the next year. For insurers, they are expecting an impact as well. Even though they are being investigated by the U.S. Senate and DOJ for fraud, they plan to use the cuts as an opportunity to continue their attack on physician reimbursement. UnitedHealthcare, Humana, Aetna, Cigna, Blue Cross/Blue Shield specifically plan to withhold as much reimbursement as possible from physicians in order to preserve profits for their shareholders as a result of the cuts.

In addition, CMS plans to cut physician reimbursement by an additional 27.4% starting January 2012. In October of 2012, CMS will also withhold reimbursement for those physicians and hospitals who have “poor” patient satisfaction survey scores (HCAHPS).



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