With the failure of the Joint Select Committee to achieve a deficit-reduction proposal, automatic adjustments are being made effective January 1, including a 27% decrease in spending to Medicare. So what does that mean for doctors and patients?
These cuts decrease the economic incentive for doctors to take on Medicare patients. What may end up happening is Medicare patients will find the supply of doctors who can offer them services, more and more scarce. With less money being paid for the type of care that some Medicare patients need, it simply will not be economically feasible for the doctor to see that patient. The profit margin for a given procedure could be miniscule or even negative. This creates scarcity in the medical field and negatively affects both patients and doctors.
The economic implications for individuals employed by doctors in the private sector could be negatively affected as well. With less money coming in for procedures, there is going to be less money for payroll, and some practices might be forced to lay off some of its staff.
Edward Gulko of northjersey.com writes that on average, a private medical practice will employ four to five people per physician. These offices purchase things such as office supplies, medical equipment, furniture, rent building space, buy insurance, require the services of accountants and attorneys, and the list goes on. This all has a profound impact on the local economy, and with less money coming in for procedures, less money will be used for expenses on the above mentioned items.
There doesn’t seem to be an immediate answer to the question at hand; which simply stated is, ‘How can the government cut spending without having social programs such as Medicare suffer?’ With the January 1 deadline quickly approaching, for the sake of everyone involved, let’s hope that congress comes up with an answer fast.
