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February 9, 2015

Obama budget called ‘very bad’ for hospitals

Massachusetts hospitals say President Obama's new fiscal 2016 budget proposal is full of "very bad news," namely billions of dollars in reductions in payments to health care providers.

In a report released over the weekend, the Massachusetts Hospital Association reported that Obama is seeking $350 billion in cuts to health care providers as part of the president's proposals to reduce overall health care spending by $423 billion.

As the Republican-controlled Congress begins reworking Obama's budget, the association is raising concerns about reductions in spending on inpatient rehabilitation facilities, long-term care hospitals, critical access hospitals, off-campus hospital outpatient departments and home health agencies, as well as reduced payments to hospitals in connection with bad debt and medical education.

"The proposed cuts are very bad news for hospitals that have been constricting themselves at the same time that they are undertaking innovative care delivery models within ever-shrinking operating margins," the association reported. "The good news is that a president’s budget proposal is usually dead on arrival. The House Budget Committee will begin work on its own document soon and while the president’s proposal will not be considered in mass, individual provisions are often adopted in the Congressional blueprints."

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