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A Word From the President: The Long Road to Fiscal Sustainability: Our Advocacy for the Year Ahead

AAMC Reporter: January 2013

Our nation’s lawmakers spent the early hours of 2013 in a budget showdown that will set the stage for the 113th Congress. While we can be glad the country did not go over the “fiscal cliff,” the agreement that Congress passed—The American Taxpayer Relief Act of 2012—is only a partial solution to our nation’s most pressing economic problems. In this column, I will explore what this agreement means for the nation’s medical schools and teaching hospitals, and what we can expect from leaders on Capitol Hill and in the White House in the new year.

On a positive note, we can be heartened that the agreement lawmakers struck to avoid the fiscal cliff recognizes the critical and unique missions of our nation’s medical schools and teaching hospitals, and the patients for whom they care. Though Medicare support for graduate medical education, hospital outpatient departments, and bad debt have been “on the table” for cuts in recent deficit reduction negotiations, the legislation passed leaves these programs untouched—for now.

We also can be pleased that the agreement includes a one-year patch of the Medicare Sustainable Growth Rate (SGR) formula, also known as the “doc fix.” Medicare physician reimbursement rates that were scheduled to be reduced by 26.5 percent on Dec. 31, 2012, instead will be frozen through Dec. 31, 2013. We remain concerned, however, that patient care payments for our physicians have been maintained at the expense of our teaching hospitals’ ability to provide care. Half of the cost of the SGR fix was funded through hospital cuts. We must make it clear that so-called “provider cuts” actually are cuts to patient care. Since the current one-year patch came with a hefty price tag—more than $25 billion—and given that a long-term solution would cost significantly more, we can expect that any effort to fix the SGR could be used as the rationale for health care cuts to other areas in future negotiations.

Thank you to everyone in our community who helped educate lawmakers over the past several months through calls, e-mails, and visits to Capitol Hill. Though the deal is far from perfect, it is clear that your advocacy helps policymakers understand our unique missions, such as providing care to millions of Medicare beneficiaries, serving the nation’s most vulnerable patients, training the physician and health care workforce, providing round-the-clock services unavailable anywhere else, and advancing groundbreaking medical research.

But our work is far from done. The American Taxpayer Relief Act of 2012 fails to address the larger threat of the budget sequester and its potentially devastating reductions to Medicare funding and medical research supported by the National Institutes of Health. The bill delays the date of the fiscal year 2013 sequester by only two months to March 1, 2013. At stake is approximately an 8 percent cut to nondefense discretionary spending in fiscal year 2013, on top of an additional $900 billion in discretionary spending cuts over the next decade already mandated by the Budget Control Act. If allowed to occur, such cuts would turn back the clock on lifesaving cures and medical discoveries and jeopardize access to care.

We certainly understand the urgency of the current fiscal climate and recognize that reducing the deficit is essential. It is equally important, however, that we advocate vigorously against unwise, disproportionate cuts to our mission support that could destabilize our institutions at a time when they are needed most. Our nation’s population is growing, aging, and becoming increasingly diverse—just as 32 million more Americans gain insurance coverage under the Affordable Care Act. We need to remind lawmakers of this unprecedented confluence of factors as we advocate for a thoughtful, balanced approach as Congress takes on entitlement and tax reform, the sequester, and the debt ceiling.

In the coming year, we will need the help of everyone in our community to continue to make the case that, should Congress decide to cut spending for hospitals, Medicare, or related programs, these cuts should not disproportionately impact medical schools and teaching hospitals. The nation’s most vulnerable patients, and the institutions that care for them and provide services unavailable elsewhere, simply are not the people or the places that should shoulder an unfair share of the burden.

To help our community stay abreast of breaking news and updates from Washington, I encourage you to download a new app we have developed: AAMCAction. The AAMC’s first app, this new tool will provide you with on-the-go access to the latest AAMC news and information on key advocacy initiatives. AAMCAction is available for your iPhone or iPad via the App Store, or on your Android device via Google Play.

Whether it is preventing and curing disease, training the next generation of physicians, or eliminating health disparities, the issues of concern to medical schools and teaching hospitals transcend politics. Ensuring the health of the nation is a nonpartisan priority, but one that will require bipartisan approaches to preserve and enhance it.

While I have no doubt that medical schools and teaching hospitals will continue to lead positive change in the nation’s health system, federal support for our work is critical to our ability to provide patient care that simply is not available elsewhere, to advance medical research, and to train future health professionals. The AAMC is committed to ensuring that policymakers balance our nation’s health policy with our fiscal policy in a way that recognizes the unique role our institutions play in the country’s health care system. I look forward to partnering with you in what is certain to be an exceptionally challenging and busy year.

Darrell G. Kirch, M.D.
AAMC President and CEO