On January 1st doctors treating Medicare patients will get a 30% cut..."fiscal cliff".

[madfloridian]

From NPR:

http://www.npr.org/blogs/money/2012/11/29/166093301/a-huge-pay-cut-for-doctors-is-hiding-in-the-fiscal-cliff">A Huge Pay Cut For Doctors Is Hiding In The Fiscal Cliff

Every year Congress has stopped a huge cut at the last minute. I don't feel confident about this year.

Included in the fiscal cliff is a 30 percent pay cut to doctors who treat Medicare patients. It's set to kick in on Jan. 1. Lawmakers from both parties say they want to prevent the cut. But the cut is part of a plan Congress put in place 15 years ago to contain healthcare costs, then proceeded to postpone again and again.

..."So instead, Congress passed a bill to ignore the formula that year. Instead, they raised doctors' fees. And then for the next year. And the next...

The formula is cumulative. So if you ignore a 4 percent cut two years in a row, the following year the formula will call for an 8 percent cut. And so on. The formula now says doctors' pay should be cut by 30 percent next year — which means that $160 Dr. Murrow made for treating Chris Veres's grandfather should, according to the formula, be only about $120.

There is more from the Bioethics site about the way all health care will be affected if nothing is done.

http://www.bioethics.net/2012/12/health-care-along-the-fiscal-cliff/">Health Care Along the Fiscal Cliff

How will this affect health care?

In short, health care will see a big cut in federal dollars. The biggest component that affects health care is from sequestration (“sequester cuts”). In 2011, Congress began budget negotiations to reduce the federal deficit and raise the debt ceiling limit. A sort of stalemate had occurred because Democrats wanted to raise the limit and then separately discuss reducing the deficit through raising taxes while the Republicans wanted to use the limit as a negotiation point to reduce the deficit through federal spending cuts. In exchange for raising the debt ceiling and to encourage negotiators to reach a compromise plan, Congress passed the 2011 Budget Control Act. This law threatened draconian budget cuts—$1.2 trillion total—to automatically begin in January 2013 if no budget deal was reached. Sadly, no deal happened then and no deal is being reached now with less than ten days remaining in the year.

The Congressional Budget Office and economic pundits believe that falling off the cliff will be destructive to the economy overall. For example, the sequestration splits cuts equally between military and non-military spending,. For 2013, this is a cut of 8.2% or $109 billion. Many of the changes will dramatically affect U.S. health care. The Budget Control Act cuts 2% of all Medicare expenditures each year from 2013-2021. In 2013 alone, the projected decrease is approximately $11 billion dollars. The automatic 8.2% reduction means that the National Institutes of Health (NIH) would lose $2.5 billion, the Centers for Disease Control & Prevention (CDC) would lose $490 million, and the Food and Drug Administration (FDA) would lose $318 million. However, Social Security, Medicaid, Children’s Health Insurance Program (CHIP) Supplemental Nutrition Assistance Program (SNAP—formerly food stamps), child nutrition and other programs are exempt from the cut. On the military side, while the Veteran’s Administration (VA) is safe from cuts, the military TRICARE health program would also be cut by 2%.

The most immediate and dramatic cut is a 27% reduction in Medicare reimbursement rates.In real money, this amounts to $25 billion dollars less going to health care providers and hospitals. This cut comes from the creation of the sustainable growth formula (SGR) that was part of the 1997 deficit reduction deal. The SGR links physician payments to economic growth as a way to limit the increase in physician payments. However, soon after passage, the rate of growth in health care costs outstripped growth in the rest of the economy. The formula did not take into account a growing population, more expensive care, and patients using a higher volume of services. Thus, instead of providing a measured annual increase in funds, the SGR actually calls for a decrease in funds. To prevent these dramatic cuts, each year Congress has voted to stay the cuts for one year.

Seniors are feeling uneasy with just cause. Also included is the Chained CPI, a method of figuring COLA that will include all services.

It's not comfortable to hear the words of David Plouffe. His words are not reassuring. He recently told a college group that Medicare and Medicare are the http://www.democraticunderground.com/101788461">"main drivers" of the deficit.

[Enthusiast]

1. David Plouffe speaks with such conviction

that social security and medicare must and will receive deep cuts. He never once considers alternatives. And he tells us that President Obama shares his convictions.

[Divine Discontent]

2. there gonna lose a lot of us if they do this crap. nt