Washington, D.C., government relations director Julie Scott Allen was quoted in Modern Healthcare in an article on President Barack Obama's proposal to shave $400 billion from federal health care spending over the next decade.
The budget did not include sweeping reforms to the nation's healthcare entitlement programs, rather, it seems that post-acute-care providers, clinical laboratories and home health agencies took the hardest hit.
Discussing the 1.75 percent cut in payments every year for 10 years that clinical laboratories would see, Julie noted that the Patient Protection and Affordable Care Act included that percentage cut for five years, and this new proposal would add another 10.
Clinical labs made up 1.6 percent of total Medicare spending in 2011. Meanwhile, this segment has faced a 20 percent reduction over five years in the Affordable Care Act, a 2 percent cut in 2012 to pay for changes in the physician payment formula, and another 2 percent this year through sequestration while most operate at profit margins between 0 percent and 3 percent. Consequently, Julie explained, some of these operators have stopped working with nursing homes, laid-off workers, or considered selling their business.
Now that the White House, Senate and House have released their respective budgets, it remains to be seen how the lawmakers will reach an agreement.