Medicare payments would be spared a 30% decline until 2014 if President Obama’s proposed budget for fiscal 2012 is approved.

The pay-fix provision would ensure no updates in 2012 and 2013, due to the $62 billion in savings the administration is expecting from Medicare and Medicaid.

Needs OK from GOP
The budget will need to pass Republican scrutiny, though, and that could bring additional changes.

The AMA has praised the budget provision, describing the cuts if it doesn’t go through as “devastating.”

Budget Rx
The budget proposal includes a 10-year fix to the sustainable growth rate, but only the first two years are paid for.

Those two years, at $54 billion, will be covered by $62.2 billion in expected savings.

Those dollars are anticipated through money recouped from HHS/OIG/Department of Justice fraud and abuse efforts, and savings from generic drugs available to Medicare and Medicaid.

How it’s viewed
Will enough lawmakers view it as the White House has? Obama’s proposal says the two-year fix is paid for in full, but whether those savings are considered to be real is the question.

The two sources of savings aren’t guaranteed, and the drug savings will be impacted on the reaction from drug companies.

We hope this information from TCI researchers help your billing department assure correct payment for claims.  Please contact us if you have any questions.