Deadlock leaves industry anxious
Supercommittee deadlock raises anxiety for providers, docs and payers
Without details, the healthcare industry continued to be at a heightened state of anxiety as the congressional deficit-reduction panel remained deadlocked heading toward its deadline this week. Providers, physicians and payers were waiting to see what—if any— plan the Joint Select Committee on Deficit Reduction would develop before its Nov. 23 deadline to identify at least $1.2 trillion in cuts over 10 years. If the committee fails to identify these cuts, then the so-called “trigger,” or sequestration, will kick in, and Medicare providers will face a 2% reduction in payments starting in 2013.
Fitch Ratings issued a report attempting to project the fallout in the healthcare industry, estimating that a 2% Medicare cut would cause not-for-profit hospital operating margins to drop by roughly 29%, on average, with the caveat that the analysis doesn’t reflect any costreduction measures hospitals might take in response.
A rally, above, on Capitol Hill urged the rejection of cuts as the supercommittee moved toward its deficit-cut deadline this week.