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White House specifies looming Medicare spending cuts

Friday September 14, 2012
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Total Medicare payouts will drop by $11 billion beginning in January because of spending cuts triggered by the Budget Control Act of 2011, according to a report from the White House Office of Management and Budget.

The cuts are part of $120 billion in mandatory spending reductions that will affect healthcare, defense and other sectors unless Congress comes up with an alternative debt reduction package. The current agreement was reached as part of last year’s negotiations to raise the federal debt limit.

Medicare payments to hospitals and physician practices will decrease by 2%, according to the agreement (coverage levels and amounts for Medicare beneficiaries will not change).

The report also noted that the National Institutes of Health, which includes the National Institute of Nursing Research, would lose much of its funding for scientific research. And “the Department of Agriculture’s efforts to inspect food processing plants and prevent foodborne illnesses would be curtailed,” while “the Environmental Protection Agency’s ability to protect the water we drink and the air we breathe would be degraded.”

The American Hospital Association, American Medical Association and American Nurses Association recently commissioned a report that concluded the Medicare spending cuts would result in 766,000 lost jobs in healthcare and related industries: www.Nurse.com/Article/JobsLosses.

The report released by the White House is available as a PDF at http://bit.ly/QMmv7a.

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