Stephen C. Shannon, DO, MPH

Sequestration’s Across-the-Board Cuts Affect Critical OME-Related Programs

In the days preceding the $85 billion in devastating across-the-board sequestration cuts to the federal government’s budget this year alone, the political wrangling and rhetoric in Washington were enough to make anyone conclude that we were experiencing just one more display of partisan brinksmanship politics. Yet sequestration will have a nationwide real and immediate impact to patient care. Furthermore, because osteopathic medical schools are committed to training future physicians to provide high-quality health care for many underserved and rural communities, the ultimate impact of these cuts will be to reduce patient access to care, and to increase, not decrease, health care costs for vulnerable populations.

As I wrote in AACOM’s March 4 press statement on sequestration, “The nation faces a projected shortage of 90,000 physicians by 2020. Even a short period of indiscriminate cuts is enormously disruptive to programs that are vital to our ability to continue training the future of our nation’s physician workforce.”

Specifically, sequestration’s across-the-board cuts include an automatic 2 percent cut to Medicare that threatens to result in millions of dollars of cuts to graduate medical education (GME) funding. While it is not yet clear which Medicare areas will suffer the most, hospital and physician reimbursement must be cut, and this could include GME. Cutting any funding for medical residency training will further exacerbate the physician workforce shortage and current and future patient access to care. Sequestration will certainly affect the plurality of osteopathic medical school graduates continuing to pursue their medical residency training.

In addition to the 2 percent provider cuts in Medicare, the indiscriminate 8.2 percent cut to program funding levels in most non-defense discretionary programs will also significantly impact osteopathic medical schools and their students.These destructive cuts affect the Title VII health professions training programs related to primary care training in the Health Resources and Services Administration (HRSA). The sequester also will cut the National Health Service Corps (NHSC) Trust Fund by 5.1 percent, immediately resulting in fewer scholarships and loan repayment awards. While osteopathic medical students account for about 20 percent of all U.S. medical students, in 2011 they received 40 percent of all NHSC physician scholarships (DO and MD). (See the related article previously published in Inside OME.) The NHSC program provides scholarships and loan repayment for selected students who commit to providing health care services to underserved populations located in selected Health Professional Shortage Areas (HPSAs). Thus, the cuts will negatively impact underserved populations who are in most need of patient care.

Cuts to funding for the National Institutes of Health (NIH) medical research will stifle medical discoveries that save lives and help drive the nation’s economy through well-paying jobs in the field of technology. NIH supports researchers in every state across the nation and in many colleges of osteopathic medicine. As a result of the across-the-board cuts, NIH could potentially eliminate 2,300 new and competing research grants. Virtually all of the programs that benefit the nation’s osteopathic medical students, including the federal financial student loan program at the U.S. Department of Education (USDE), will be deeply impacted by these cuts. Moreover, the USDE would receive a total cut of over $4 billion in fiscal year 2013 alone.

As Congress continues to work to address our nation’s federal debt and move us to more sound fiscal footing, AACOM will continue to advocate strongly for viable alternatives to sequestration (see, for example, my February letter to Members of Congress). I invite you to review AACOM’s FAQ’s on Sequestration and to join us in our critical advocacy efforts by reaching out to your federal policymakers and urging them to find a balanced approach to the federal deficit and reject sequestration as a solution to dealing with our nation’s economic situation. This is not the time to remain idle. Make your voice heard! 

To sign up for AACOM’s Advocacy Action and Information Alerts, visit here.

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March 2013
Vol. 7, No. 3 / 5