Medicare providers not worried about sequester

The Associated Press

WASHINGTON -- 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?

Because 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 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 portion of the automatic spending cuts was designed to try to avoid pain for individuals and families.

Medicaid, the health care program for the poor, was exempted, as were the biggest subsidies under Obama's health care law, which starting next year will help uninsured people pay premiums.

The Medicare cut means providers -- such as hospitals, doctors and health plans -- will be reimbursed at 98 cents on the dollar.

Seniors' benefits and premiums weren't touched. However, if the automatic cuts remain in place, Medicare Advantage plans could see higher premiums over time.