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No ruckus about cutting Medicare in sequester

Published: Thu, February 28, 2013 @ 12:00 a.m.

Associated Press


Hospitals, doctors and other Medicare providers are on the hook for a 2 percent cut under looming government spending reductions. But they’re not raising a ruckus. Why?

The pain could be a lot worse if President Barack Obama and congressional Republicans actually did reach a sweeping agreement to reduce federal deficits.

Automatic cuts taking effect Friday — the “sequester” in Washington-speak — would reduce Medicare spending by about $100 billion over a decade. But Obama had put on the table $400 billion in health-care cuts, mainly from Medicare. And Republicans wanted more.

“What people were really worried about was the prospect of a huge deficit bill that could target Medicare for $400 billion or $500 billion,” said John Rother, president of the National Coalition on Health Care, an umbrella group that includes service providers.

“The health-care industry fears the alternative more than they fear a predictable reduction in rates,” said Dan Mendelson, president of Avalere Health, a market analysis firm. “They just do not want to roll the dice. That is why you do not hear as much of an outcry on Medicare.”

The budget machinations come at a time when the threat that the government will be overwhelmed by surging health costs seems less immediate. Taking care of aging baby boomers is still a huge challenge, but health care inflation has slowed dramatically in the last few years, leading government number crunchers to scale back their estimates of future costs.


1jojuggie(1729 comments)posted 3 years, 5 months ago

The founder of Subway restaurants is slamming the government for harsh regulations he says hurt small businesses, saying he would not have been able to successfully start his company in today's climate.

Fred Deluca told CNBC Wednesday that he believes government regulations are preventing entrepreneurs from creating value in the economy, saying the environment for U.S. entrepreneurs is getting continuously worse.

"If I started Subway today, Subway would not exist," Deluca told CNBC.

Deluca named a number of government regulations, including a possible increase in the minimum wage, the end of the payroll tax holiday and the the Affordable Care Act or ObamaCare.

Deluca said ObamaCare is "the biggest concern of our franchisees."

"They don't know what to expect," he told CNBC. "It's causing a lot of concern, but that too will be passed on to the consumer

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