Obama Administration Proposes $340 Billion in Medicare Cuts in Preliminary “Fiscal Cliff” Negotiations | Healthcare Informatics Magazine | Health IT | Information Technology Skip to content Skip to navigation

Obama Administration Proposes $340 Billion in Medicare Cuts in Preliminary “Fiscal Cliff” Negotiations

November 30, 2012
by Mark Hagland
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According to news reports on Nov. 28 and 29, President Barack Obama has proposed cutting $340 billion from Medicare spending over 10 years, in his fiscal year 2013 budget, as part of his initial bargaining stance with Speaker of the House of Representatives John Boehner (R-OH) and congressional Republicans, during the so-called “fiscal cliff” negotiations. The $340 billion in Medicare cuts would include avoidable readmissions reduction-related reimbursement cuts; requiring some pharmaceutical manufacturers to pay rebates to the Medicare program in some circumstances; reducing coverage of bad debts that hospitals and nursing homes have failed to collect from patients; and charging higher premiums to high-income Medicare beneficiaries, according to a Nov. 29 article in The New York Times.

Should negotiations now taking place between the White House and congressional leaders not bear fruit by the end of December, a comprehensive set of federal budget cuts would soon go into effect that would impact most areas of the federal budget, under a sequestration agreement hammered out between the major political parties during 2011, under the Budget Control Act of 2011.

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