The American Medical Association (AMA) urged Congress to pass legislation nullifying two provisions of law it claims would reduce Medicare patients’ access to health care and lead to a loss of jobs in the health care industry, in a September 12, 2012 letter. The sequestration provision of the Budget Control Act of 2011 (BCA) (P.L. 112-25) calls for a 2 percent Medicare provider payment cut effective in 2013. The Medicare Sustainable Growth Rate (SGR) formula currently in effect would lead to a 27 percent physician payment cut for 2013.
Congress’ failure to agree on a plan to reduce the federal deficit activated automatic budget cuts, including a 2 percent cut in payments to Medicare providers, that will become effective on January 1, 2013, absent new legislation. The AMA warned that this cut would endanger patients’ access to care and lead to a loss of jobs in the health care industry. The American Hospital Association issued a press release discussing the results of a report it commissioned with the AMA and the American Nurses Association. The report concluded that more than 496,000 health care jobs would be lost during 2013 alone, with up to 766,000 lost by 2021.
The AMA also condemned the 27 percent SGR cut as “devastating.” AMA President Jeremy Lazarus noted, “Coupled with the looming 27 percent Medicare physician payment cut, this 2 percent sequester will hurt patient access to care and will inject more uncertainty into our Medicare system. We need stability in Medicare physician payment as we work to improve our nation’s Medicare payment and delivery system to promote high-quality, high-value, better-coordinated care to our patients.”