MINNEAPOLIS, February 8, 2008—The American Medical Association envisions a tough battle in the months ahead over the steep Medicare spending cuts in President Bush's new budget. The budget proposal has no provision for altering the Medicare physician payment structure.

Bush proposes reducing Medicare and Medicaid spending anticipated under current law by $196 billion over five years.

The President also proposed reducing extra payments to hospitals with high levels of charity care by 30 percent over two years, and getting rid of Medicare payments to hospitals for medical education.

Bush's Medicare proposals constitute the first skirmish in this year's health care budget debate. Health care organizations have already signaled their opposition.

The AMA has expressed its dismay that the president made no effort to solve the Medicare payment crisis. If no action is taken, physician reimbursement
will fall 10.6 percent from today's levels beginning July 1 through the rest of this year, with another 5 percent reduction next year.

Bush may yet release a plan that addresses the reimbursement schedule.

Although Democrats oppose Bush's proposals, Bush is a fierce opponent on monetary matters. Last year, the White House forced Democrats to give up on a five-year State Children's Health Insurance Program expansion, and to accept a modest increase through March 2009.

For the complete budget story, see the American Medical News story.