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American Academy of Family Physicians
Wednesday Mar 06, 2013

Sequestration and you

With sequestration now, apparently, a fact of life, what are the implications for your practice?

Absent further action by Congress, the current slate of required federal budget cuts is expected to reduce Medicare payments to doctors, hospitals, and other health care providers, as well as health plans and drug plans, by 2 percent for services provided on or after April 1.

That will result in $11 billion in lost revenues this year for providers, who will receive only 98 cents on the dollar for their services to Medicare beneficiaries.

The American Academy of Family Physicians, among other medical associations, is decrying the impending cuts.

However, as bad as sequestration sounds, things could be worse if President Obama and congressional Republicans actually did reach an agreement to reduce federal deficits. As the Washington Post noted last week, the sequester would reduce Medicare spending by about $100 billion over a decade. But President Obama had suggested $400 billion in health care cuts, mainly from Medicare, and Republicans reportedly wanted more.

So, unless federal leaders intervene in the interim, expect your Medicare payments to drop by 2 percent beginning next month – and be thankful it isn’t any worse than that.

– Kent Moore, Senior Strategist for Physician Payment for the American Academy of Family Physicians

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