A letter released Tuesday by the Centers for Medicare & Medicaid Services (CMS) dispelled concerns that ACA-mandated Medicare cuts would go into effect this year.
According to the letter, the CMS Chief Actuary is required to calculate the projected 5 year growth rate of per capita cost and spending for Medicare. It must then be determine dwhether or not the growth rate falls within a specified range. The projected growth rates are based upon the medical category of the Consumer Price Index. If the projected growth rate does not fall within the target range, a “savings target” will be implemented and Medicare cuts will take place.
This theoretical “savings target” requires a government agency to effect cuts in 2013 that would last until 2015.
Paul Spitalnic, the acting Chief Actuary, announced Tuesday that the target growth rate was not exceeded in the projected numbers. Therefore, it is not necessary to make any cuts to Medicare spending at this time.
These Medicare cuts have been highly anticipated for the past few months, leaving nursing homes and other health care facilities waiting anxiously to see whether or not they need to start making changes in operations.
Medicare cuts would have huge effects on hospitals and nursing homes that receive Medicare funds. If cuts are made to Medicare, quality of Long Term Care in government-subsidized facilities could decrease or, if cuts are bad enough, facilities might be forced to shut down.
Nursing homes were posed to receive $89 billion from Medicare in 2013, which equals out to 55% of their total revenue. Any decrease in this number would force changes, whether it be staff reduction, patient capacity, or quality of services provided.
Read the full CMS letter here.
Don’t count on Medicare to cover the cost of your Long Term Care. Medicare covers only the basics for a very short period of time (just 20 days) and Medicare cuts keep making their way to the political discussion table.
If you do not have Long Term Care Insurance, now is the time to consider getting insured.
Have questions about Long Term Care Insurance? Read more here.
Need a quote? Call us at 1-800-800-6139 or fill out our online form.