The White House has proposed $313 billion in new Medicare and Medicaid cuts over 10 years, in addition to the provisions included in the Administration’s proposed FY 2010 budget. Among other things, the Administration is endorsing: incorporating productivity adjustments into Medicare payment updates; reducing hospital subsidies for treating the uninsured as coverage increases; paying “better” prices for Medicare Part D drugs (including reducing reimbursement for beneficiaries dually eligible for Medicare and Medicaid); increasing the equipment utilization factor for advanced imaging from 50 percent to 95 percent; adopting MedPAC’s recommendations for 2010 payments to skilled nursing facilities, inpatient rehabilitation facilities, and long-term care hospitals; and cutting waste, fraud, and abuse (including prepayment review for physicians in high-risk areas or those that order a high volume of high-risk services such as durable medical equipment, home health, and home infusion services).
The following chart summarizes the Obama Administration’s health reform financing proposals released to date:
|
Source
|
Health Care Reserve Fund
($ in billions)
|
|
10 years
|
|
|
FY 2010 Budget
– Medicare and Medicaid Savings
– Revenues
|
$635
$309
$326
|
|
Additional Medicare and Medicaid Savings
– Incorporate productivity adjustments into Medicare payment
updates – Reduce hospital subsidies for treating the uninsured as coverage increases – Pay better prices for Medicare Part D drugs
– Other |
$313
$110
$106 $75 $22
|
|
Total
|
$948
|