Bush budget cuts hospital funding but silent on Medicare doctor pay

The president is expected soon to unveil a proposal addressing Medicare's long-term fiscal solvency.

By Doug Trapp, AMNews staff. Feb. 18, 2008.

Washington -- President Bush's fiscal 2009 health budget, with steep Medicare spending cuts as a main highlight, sets the stage for a tough fight with Congress in the months ahead.

The proposal, part of a wider $3.1 trillion plan, is just the first step in this year's health care budget debate. Health care organizations and congressional Democrats have found a lot not to like. Bush proposes reducing Medicare and Medicaid spending anticipated under current law by $196 billion over five years, with hospitals as the main target. The plan would do nothing to prevent Medicare physician payment cuts.

The American Medical Association expressed disappointment that Bush didn't tackle the Medicare payment problem. If nothing is done, physician reimbursement will fall 10.6% from today's levels beginning July 1 through the rest of 2008, and an additional 5% in 2009.

"The reality is that current Medicare law provides for annual payment updates for hospitals and other health care providers based on increases in the cost of providing care, and only physicians face real cuts that require yearly congressional intervention to stave off a breakdown in the Medicare program for patients," said Edward L. Langston, MD, chair of the AMA Board of Trustees.

Health & Human Services Secretary Michael Leavitt said the administration will not remain silent on the pay issue as the July 1 deadline approaches. "We intend to be a full participant in that debate."