Hospitals Oppose Further Medicare and Medicaid Cuts
The AHA and other hospital groups wrote a letter to Congress, encouraging them to avoid Medicare and Medicaid cuts following the repeal of the SGR.
- The Medicare Sustainable Growth Rate (SGR) has long been a thorn in healthcare’s side. Since 2002 when the SGR took a chunk out of provider’s pay, congress has repeatedly deferred the scheduled SGR cuts. All this did was increase the deficit. However, the release of the 2016 Federal Budget proposes to repeal the SGR, which could improve payment rates to Medicare providers.
In response to the possibility of this repeal, the American Hospital Association (AHA) as well as a handful of other hospital groups wrote a letter to Congress, encouraging them to avoid cutting Medicare and Medicaid payments following the repeal of the SGR. Other hospital groups that signed the letter are America’s Essential Hospitals, Association of American Medical Colleges, Catholic Health Association of the United States, Children’s Hospital Association, Federation of American Hospitals, National Association of Psychiatric Health Systems, Premier healthcare alliance and VHA Inc.
The letter begins on a positive note, expressing appreciation for Congress’s efforts to remedy the SGR, and acknowledges that postponing the SGR cuts have contributed to the approximately $122 billion in hospital cost cuts since 2010.
However, the letter also indicates that the cuts from Medicare and Medicaid have consequences on the hospitals’ bottom line and their ability to provide adequate services.
“The hospital community places great value in our relationship with physicians and in the need for a proper, permanent fix to the SGR,” the letter states. “Doctors must be reimbursed properly for their work to create a sound ecosystem for patients, regardless of which type of payment model applies. However, it is unsustainable and unacceptable for hospitals to take on any further financial burden in order for this to be accomplished. We urge the committees to recognize the operational realities facing community hospitals.”
This is one of many revenue problems Medicare and Medicaid providers have faced recently. Since the expiration of the Affordable Care Act’s fee increase, Medicaid provider’s reimbursement rates have been predicted to drop by nearly half. With the fee drop, patient appointment availability is expected to drop, increasing emergency department volumes.
Another article reported that without additional funding, healthcare systems currently in place are not sustainable. The challenges to healthcare are reported to be a public resistant to change, and difficulty managing the services in place to meet with expected standards of care. To improve, the article indicates that an agreement needs take place amongst government officials on healthcare policies.
“Eliminating planned cuts to physicians in Medicare is aimed at ensuring access to care for our nation’s Medicare beneficiaries. Simultaneously cutting hospital payments defeats this purpose by raising new barriers to access,” the letter to congress concludes. “We urge you to oppose any additional hospital Medicare and Medicaid cuts to offset the cost of resolving the SGR.”
