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(Circulation. 2000;101:e9008.)
© 2000 American Heart Association, Inc.

Cardiovascular News

Hospitals Still Losing on Medicare, Despite Federal Relief Attempts

Ruth SoRelle, MPH, Circulation Newswriter

Six of 10 hospitals will still be losing money on Medicare by the year 2004, despite an $8.4 billion attempt last year to provide relief to the program, the American Hospital Association (AHA) said. The hospital group based its prediction on a new analysis by The Lewin Group.

The Lewin study, performed at the request of the AHA, showed that the Balanced Budget Relief Act gave hospitals only 1% more in Medicare payments over the next 5 years than they regularly receive. The AHA released the report during a rally held on Capitol Hill.

The study showed that the total Medicare margins or profits for hospitals will drop between 1.6% and 6.6% by the year 2004. The report also shows that hospitals can no longer make up for low Medicare payments by cost shifting to private-pay patients because private payers are cutting costs as well.