Nov. 30, 2012
If President Barack Obama and Congress cannot reach an agreement on the fiscal cliff, economic experts agree it would be devastating.
It would likely send the country back into recession, according to the Congressional Budget Office, and some 3.4 million jobs would be lost. And ultimately, it could hurt your physical and emotional health.
That's because the part of the government that handles health-related programs -- Medicare, medical research, food safety inspectors -- all would be automatically cut starting January 2 if there is no agreement on the Budget Control Act. If not amended in time, the move would abruptly remove $1.2 trillion from the federal budget...
Some 50 million people rely on Medicare to cover their health care costs. The federal health insurance program, which is available to all people 65 and older and people with permanent disabilities, has seen a huge increase in people needing its help. Fewer companies offer retiree health benefits (down to only 25% of the population, according to the nonpartisan Kaiser Family Foundation).
Automatically, 2% would be cut from this program's budget. While this is less than the general 8.2% across-the-board cuts for other federal programs, it would amount to a budget reduction of around $11 billion. That would mean payments to doctors, hospitals, long-term care facilities and nursing homes could be reduced significantly.
Health care providers already complain that the Medicare reimbursement rate is too low. Ultimately, those facilities could stop taking Medicare patients.
"Or there would be a cost shift," said Julie Barnes, director of health policy at the Bipartisan Policy Center. "That means, ultimately, they might have to charge private patients more. What else can they do? They've got to meet their expenses."
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