Clinton touts $138 billion Medicare cut
Clinton touts $138 billion Medicare cut
One of the biggest controversies of the 1996 election centered on Medicare spending. Republicans fought for $270 billion in growth reduction over seven years. Democrats fought back with millions of dollars in national advertising warning that the GOP’s plans would gut Medicare and leave seniors ill-equipped to face the future.
Shortly after his re-election and early into his 1997-98 fiscal year budgeting proposals, President Clinton is offering to meet Republicans "halfway" with regard to Medicare economic policy. In the name of partnership with the GOP, Clinton says he will support cutting Medicare’s growth rate by $138 billion over the next six years. That’s pretty close to half of what Republican leaders wanted prior to the election.
Clinton isn’t offering many specifics yet, but generally, here is where those cuts would be made:
• $45 billion in reductions to hospital payments;
• $46 billion in cuts to HMOs;
• $18 billion in cuts to beneficiary premium supports;
• $29 billion to all other Medicare programs, including physician payments.
Exactly how physicians’ Part B fee-for-service payments would be affected is yet to be specified. Physician payments in HMO contracts, however, would clearly be whacked down.
Here’s Clinton’s proposal: Cut Medicare’s base capitation payment the Adjusted Average Per Capita Costs, or AAPCC so the average AAPCC would equal 90% of the average fee-for-service charge. The current threshold is 95%.
For example, say in your locality, Medicare pays you $100 per Medicare HMO enrollee. That figure is estimated to be 95% of what it would cost Medicare if that patient were in a fee-for-service Medicare plan. If reduced, the AAPC payment would be 5% less, or $95.
Following are names and telephone numbers of sources quoted in this issue:
• American Health Information Management Association, Chicago; Sue Proffitt, RRA, CCS, director of classification and coding. Telephone: (312) 787-2672.
• American Medical Group Association, Alexandria, VA; Donald W. Fischer, PhD, chief executive officer. Telephone: (703) 838-0033.
• Murfreesboro Medical Clinic and Surgicenter, Murfreesboro, TN; Donald Lloyd, FACMPE, chief executive officer. Telephone: (615) 893-4480.
• University of Maryland Center on Aging, Baltimore; Mark Meiners, PhD, director of the Medicare-Medicaid Integration Program at the University Center on Aging. Telephone: (301) 405-2471.
• Watson Clinic, Lakeland, FL; Glen Bardon, MD, managing partner and chief executive officer. Telephone: (941) 680-7000.
• Heidi Wagner Hayduk, JD, Medicare policy consultant; McLean, VA. E-mail: HWagHayduk@ aol.com.
• Colorado Springs Health Partners, Colorado Springs, CO; Jeff B. Milburn, vice president of finance. Telephone: (719) 475-7700.
• L.M. Hansing & Associates, Englewood, CO; Linda M. Hansing, president/practice management consultant. Telephone: (303) 290-0551.
• Permanente Medical Group, Washington, DC; Donald P. Parsons, MD, associate medical director. Telephone: (202) 296-1314.
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