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AAMC Expresses Concerns About Sequester’s Impact
September 28, 2012—In a Sept. 27 letter to congressional leaders, AAMC President and CEO Darrell G. Kirch, M.D., Sept. 27 said the AAMC “is deeply concerned about the impact of the pending sequestration mandated by the Budget Control Act on programs that are vital to the health of the American people.”
The letter notes that the Office of Management and Budget (OMB) has estimated that sequestration, set to take effect Jan. 2, 2013, would reduce non-security discretionary (appropriated) spending by 8.2 percent in FY 2013 [see Washington Highlights, Sept. 21], and points out that these cuts will come on top of an additional $900 billion in discretionary spending cuts already mandated by the BCA over the next decade.
The letters states the impact of the $2.5 billion cut in medical research funded by NIH “will be immediate and devastating" and adds, "Even more troubling is that this cut would come at the end of a decade that has seen the NIH budget fall by nearly 20 percent after inflation.”
“Sequestration also will undermine ongoing efforts of HRSA's Title VII health professions programs to improve the supply, diversity, and distribution of the health care workforce,” the letter states. “The realized consequences of sequestration for HRSA programs could extend far beyond the estimates provided here, as grantees lose the ability to leverage HRSA funding to acquire state, institutional, and philanthropic support, and as mounting fiscal constraints over the next decade jeopardize the viability of the modest federal investment in the programs in future years. These threats come as the nation grapples with critical physician and other health professional shortages.”
The letter also expresses concern that “sequestration threatens Medicare hospital and physician payments at a time when Medicare already fails to cover the cost of care.” OMB estimates the 2 percent sequester of Medicare will cut provider payments by $10.7 billion. A recent Tripp Umbach analysis indicates that the cuts to provider payments will result in the loss of nearly 500,000 jobs.
“The AAMC also is concerned that despite the 2 percent limit on Medicare cuts, sequestration will have a significant impact on Medicare's long-standing support for graduate medical education (GME) and will ultimately limit teaching hospitals and physicians ability to care for all patients and train the next generation of physicians,” the letter states.
Emphasizing that "if we are to address the health challenges of an aging and increasingly diverse population, and remain a vibrant force in the global economy, America needs more investment in medical research and the health professions workforce, not less," the letter concludes that AAMC “urges Congress and the Administration to work together on a solution that avoids sequestration— and the devastating impact of across-the-board cuts— on programs that benefit all Americans.”
The letter was sent to Senate Majority Leader Harry Reid (D-Nevada), Senate Minority Leader Mitch McConnell (R-Ky.), House Speaker John Boehner (R-Ohio), and House Minority Leader Nancy Pelosi (D-Calif.).
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