October 31, 2011
The proposed Medicare cuts by President Obama and the Congressional “Super Committee” does not bode well for physicians and geriatric medicine in the country. Although the cuts would ensure that Medicare bankruptcy would be postponed and the Federal deficit reduced, it has long term negative consequences for long-term care hospitals, nursing homes, home health facilities, and rehabilitation facilities. The cuts in the form of reduced reimbursement for providers of geriatric care would be eventually borne by seniors and baby boomers of the country whose population is set to dramatically increase in a decade.
The White House Fact Sheet
The fact sheet released by the White House called “Bipartisan Debt Deal: A Win for the Economy and Budget Discipline” states that – “The enforcement mechanism in the deal exempts Social Security, Medicaid, Medicare benefits, unemployment insurance, programs for low-income families, and civilian and military retirement.” However, it also states that any cuts to Medicare would be capped and limited to the provider side. This essentially means that geriatricians would be losing out on revenue and may consider dropping Medicare patients altogether. Moreover, many nursing homes and long term care hospitals are already losing money due to poor stock market performance after the cuts were announced.
The Cascading Effect
Medicare cuts in reimbursements of hospitals, physicians, and nursing homes would have a cascading effect in the form of physicians shifting the costs to private insurers which in turn would be shifted on patients. The effect would not stop there and shift to employers resulting in a crisis in the employment sector. Although there is a need for cost cutting for reducing the Federal deficit, targeting Medicare would only result in long term financial and physical depredation for seniors and older citizens with chronic illnesses.
Baby Boomers Projections and Medicare
The number of baby boomers, according to the U.S census bureau, would reach almost 58 million in the year 2030. This would essentially mean that geriatric care would be in very high demand making Medicare a prime component of the health industry. However, since many physicians and hospitals would drop Medicare patients due to reduced reimbursements it would become very difficult for senior citizens to afford health care. Moreover, because of the dearth of physicians opting for elderly care and geriatrics, it would prove to be double whammy for older people in the country.
Dealing with Medicare Cuts
The cuts in reimbursements have been postponed for many years but with the automatic cuts which start in the year 2013, it is a looming reality that has to be dealt with by physicians, geriatricians, and nursing homes sooner or later. There are some ways to ensure that, as a provider, your revenue is not affected and at the same time senior citizens are not at the receiving end when the cuts do take place. However, many physicians feel that they would be forced not to accept new Medicare patients if the cuts take place which would be an ideal solution but with negative consequences for senior citizens in the future along with the efficiency of already floundering geriatric practices in the United States. One of the best solutions for at least partially dealing with such cuts is to focus on preventive health care and ensuring that older people get sick less often. Another way of dealing with the cuts is just to put more time and effort in order to increase revenue which would be a win-win situation for physicians as well as senior citizens.
Another solution is cutting down on the in-house staff and delegating or outsourcing auxiliary services to a third party in order to save time, money, and effort. However, it cannot be denied that there are no quick fix solutions for dealing with Medicare cuts and many providers are still puzzled over the course of action to be taken if such cuts do take place.
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ACA / HIPAA / Reforms