The Medicare cuts under the Patient Protection and Affordable Care Act (ACA) will cost local healthcare providers more than $8.4 billion over 10 years, according to estimates from the Medical Industry Leadership Institute.
The Congressional Budget Office (CBO) estimated the 10-year ACA impact of cuts to Medicare Advantage plans and fee-for-service providers in July. The CBO said the payment reductions, which are the primary source of the ACA’s budgetary savings, would be $716 billion nationally.
The Texas share of that cut would be more than $43 billion, according to researchers Robert Book and Michael Ramlet. Locally, the reductions between 2013 and 2021 are expected to cost Dallas County providers more than $4 billion, which is far less than the more than $6.7 billion estimated cut for Harris County.
Tarrant County providers are expected to lose $2.78 billion, compared with nearly $900 million in Collin County and $636 million in Denton County.
The 10-year cuts include:
- $415 billion for Medicare fee-for-service programs. That includes $260 billion for hospital services, $66 billion for home health services, $39 billion for skilled nursing services, $17 billion for hospice services and $33 billion for other services.
- $156 billion for adjustments to payment rates for Medicare Advantage.
- $25 billon for disproportionate share hospital payments from Medicare and $31 from Medicaid.
- $114 billion in other provisions, such as the Independent Payment Advisory Board.
Providers are hoping to recoup the Medicare reimbursement cuts with increased volume of services when Americans are required to have health insurance in 2014. Gov. Rick Perry has refused to allow Texas to participate in the Medicaid expansion under the ACA. The federal government has exempted low-income Texans who would have qualified for Medicaid under the ACA from the insurance mandate.
Steve Jacob is editor of D Healthcare Daily and author of the new book Health Care in 2020: Where Uncertain Reform, Bad Habits, Too Few Doctors and Skyrocketing Costs Are Taking Us. He can be reached at [email protected].
