Managed Care Matters’ Joe Paduda brings me back down to earth from my ‘maybe they can do delivery system reform in the bipartisan super committee’ heights and offers a more realistic look at what the cuts will look like (if you believe the group will agree on a set of reductions in the first place):
With Medicare and Medicaid accounting for a large and ever-increasing part of the deficit, by necessity the super-committee is going to have to look at provider reimbursement. As Bob Laszewski points out, they don’t have time to fundamentally alter reimbursement methodology, can’t change the eligibility parameters under the terms of the deal, and they are starting from a deficit projection that assumes the pending 29.5% cut in physician reimbursement is actually going to happen.
The 29.5% alone accounts for about $300 billion, so the super-committee has to find another $1.2 trillion on top of that $300 billion.
Where’s it going to come from?
Physician reimbursement under Medicare and Medicaid is going to get hammered.
Hospitals are going to see substantial cuts in reimbursement as well.
Pharma and PBMs participating in Part D are another big target, and one with less political pull in DC.
Insurers heavy in Medicare Advantage have been reporting nice earnings of late; that’s not going to escape the notice of deficit-cutters in Washington.
Expect to see means testing for Medicare as well.
These are all cuts that will have the effect of shifting costs onto beneficiaries and won’t rid the system of waste and inefficiency or encourage providers to deliver better care. It’s so depressing, isn’t it?