Hospitals, insurers would bear brunt of automatic Medicare cuts


The automatic Medicare cuts are reductions in payments to doctors, hospitals and other healthcare providers. The trigger does not include any direct cuts to Medicare benefits.

According to the Avalere analysis, the provider cuts break down as follows:

• 32 percent to inpatient hospital care

• 15 percent to Medicare Advantage plans

• 12 percent to physicians

• 8 percent to outpatient hospital care

• 7 percent to nursing homes

• 4 percent to home health agencies

• 3 percent to a small portion of the Medicare prescription drug benefit not exempt from the trigger

Sequestration does not trigger cuts to Medicaid or the Children’s Health Insurance Program. Mendelson agreed with other analysts who have said some health sectors — notably hospitals — could have been hit much harder by an actual supercommittee agreement than if the automatic cuts take effect, largely because the 12-member panel likely would have tackled Medicaid.