Medicare Payment Increases in Jeopardy?

Healthcare providers who rely on Medicare reimbursements are worried that the proposed Medicare increases they lobbied for may never materialize after Bush administration officials announced that the usable portion of the federal budget surplus for 2001 has virtually disappeared. The federal budget surplus has shrunk by $123 billion since April. The White House blamed the empty coffers on a federal spending “explosion” that followed legislation passed last December and signed by President Clinton.

That legislation, with spending increases totaling $50 billion, included an increase in Medicare reimbursements—$1.6 billion for hospitals and $2.3 billion for all other Medicare providers.  Hospitals groups are currently planning to lobby for increases of $16.2 billion over five years when Congress reconvenes.  But according to Charles Kahn, president and CEO of the Federation of American Hospitals, “the administration is going to be looking down every budget alley to find a place to trim.”