Liberty Hospital near Kansas City, Mo., has eliminated 120 jobs this year, closed its wound-care clinic, and stopped offering free rides to poor and elderly patients. The Cleveland Clinic is searching for ways to cut $250 million from its $6 billion budget in the next 16 months. It’s already closed expensive maternity wards in half the hospitals it operates. In northern New York, Adirondack Health may shutter its emergency room in Lake Placid and a dialysis center in Tupper Lake. All of these hospitals and scores of others nationwide are squeezing services to make up for unexpected budget shortfalls—the result of a deal they made with the federal government that they’re now having second thoughts about.
When the Obama administration was selling the benefits of the Affordable Care Act in 2010, the hospital industry agreed to accept a $155 billion decrease in Medicare payments over a decade. The administration assured hospital executives that patients newly covered under the health-care law would make up for much of the loss. Because of the ongoing squabbles between President Obama and Republicans in Congress over the U.S. budget, that hasn’t happened.