Oddsmakers predict sequestration and SGR delay

The White House and some lawmakers are confident that the automatic budget cuts could be put off temporarily until after new elected officials take office.

By Charles Fiegl amednews staff — Posted Nov. 2, 2012

Print  |   Email  |   Respond  |   Reprints  |   Like Facebook  |   Share Twitter  |   Tweet Linkedin

White House and congressional officials in Washington have acknowledged that the large federal budget cuts and tax increases set for early 2013 probably won’t happen.

The fiscal cliff, which includes significant cuts to Medicare and other federal health programs, could be avoided through temporary fixes after the presidential election on Nov. 6. Lawmakers appear to be leaning toward punting these issues to the next Congress, as a lame-duck session is unlikely to draft and pass comprehensive legislation to address the underlying fiscal problems permanently.

The subject of the roughly $1 trillion in across-the-board cuts known as the sequester was discussed at the Oct. 23 presidential debate on foreign policy. President Obama, who debated former Massachusetts Gov. Mitt Romney in Boca Raton, Fla., stated that sequestration was not going to be implemented.

White House Press Secretary Jay Carney later told reporters that the sequester was designed as a mechanism to compel Congress to act on an alternative deficit reduction package.

“The president is confident that Congress will take the appropriate action to achieve a balanced deficit reduction package in order to avoid these onerous cuts in both defense and nondefense discretionary spending that were written into the law by Congress,” Carney said.

Organizations representing physicians, hospitals and nurses have warned that the sequester and the resulting contraction of the health care sector could cause up to 500,000 job losses and missed opportunities for new hires in 2013 alone. Congress created the automatic cuts through the Budget Control Act when House and Senate leaders, along with the White House, struck an agreement to raise the federal debt ceiling in August 2011. If lawmakers fail to develop an alternative plan to stop the automatic reductions, payments for Medicare services will be reduced by 2% in 2013.

For physicians, the sequester reduction would be on top of a 27% sustainable growth rate cut to Medicare pay set for Jan. 1, 2013. Rep. Phil Roe, MD (R, Tenn.), said during a recent interview that most members of Congress expect to approve a short-term SGR patch — lasting a couple months to a year — after lawmakers return to Washington on Nov. 13.

Congressional staffers discussed possible Medicare doctor pay scenarios during an Oct. 16 forum sponsored by Politico, an online and print newspaper based in Arlington, Va. Fixing the SGR has bipartisan support, and no one believes the 27% cut will go through, the staffers said.

“It will be dealt with despite the challenges we face at the end of the year,” said Josh Trent, a health policy adviser to Sen. Tom Coburn, MD (R, Okla.).

Back to top



Read story

Confronting bias against obese patients

Medical educators are starting to raise awareness about how weight-related stigma can impair patient-physician communication and the treatment of obesity. Read story

Read story


American Medical News is ceasing publication after 55 years of serving physicians by keeping them informed of their rapidly changing profession. Read story

Read story

Policing medical practice employees after work

Doctors can try to regulate staff actions outside the office, but they must watch what they try to stamp out and how they do it. Read story

Read story

Diabetes prevention: Set on a course for lifestyle change

The YMCA's evidence-based program is helping prediabetic patients eat right, get active and lose weight. Read story

Read story

Medicaid's muddled preventive care picture

The health system reform law promises no-cost coverage of a lengthy list of screenings and other prevention services, but some beneficiaries still might miss out. Read story

Read story

How to get tax breaks for your medical practice

Federal, state and local governments offer doctors incentives because practices are recognized as economic engines. But physicians must know how and where to find them. Read story

Read story

Advance pay ACOs: A down payment on Medicare's future

Accountable care organizations that pay doctors up-front bring practice improvements, but it's unclear yet if program actuaries will see a return on investment. Read story

Read story

Physician liability: Your team, your legal risk

When health care team members drop the ball, it's often doctors who end up in court. How can physicians improve such care and avoid risks? Read story

  • Stay informed
  • Twitter
  • Facebook
  • RSS
  • LinkedIn