In early April, the Obama Administration delayed cuts in the Medicare Advantage program mandated by Obamacare. These plans, used by 30% of Medicare beneficiaries, supplement traditional Medicare coverage. The planned cuts to the MA program risked a political firestorm just months before the midterm elections. While MA received a short-term pardon, the Obama Administration is going forward with dramatic cuts to home health care services for seniors.
Over 3.5 million seniors receive health care services in their home. Over 60% of the recipients are women. These beneficiaries tend to be older, poorer and sicker than the overall Medicare population. Because of this, they often lack transportation, making home health care services critical for their well-being. Those impacted by the ongoing cuts are the most vulnerable and at-risk seniors.
Obamacare gave the Obama administration wide latitude in containing spending in the program. In a decision that baffled critics, however, the administration chose to impose the maximum cuts allowed, cutting reimbursements by 14% over the next four years. The announced cuts will dramatically shrink the home health care sector and leave over a million seniors without access to health services.
In issuing its reimbursement guidelines, the administration acknowledged that “approximately 40%” of the more than 11,000 home health care agencies would be losing money by 2017.
Home health care services had been one of the fastest growing sector for jobs. In December, 2013, however, on the eve of the cuts taking effect, the sector shed almost 4,000 jobs, the largest loss of jobs in the sector in more than a decade. Over 1.2 million Americans currently work in the home health care sector, 90% of whom are women. An analysis by Avarle Consulting estimated that almost half of these jobs, 498,000, are threatened by the Obamacare cuts.
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