Automatic Medicare cuts would save government $123 billion, report says

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If the congressional “super committee” fails to reach its deficit reduction goal, automatic Medicare cuts would save the government more than $120 billion over the next decade, according to a report.

The 12-member bipartisan committee is tasked with shaving at least $1.2 trillion over 10 years off the federal budget deficit by Nov. 23. If they do not reach an agreement, automatic 2% cuts to almost all Medicare programs will go into effect. A Congressional Budget Office report released Monday found that the cuts would save $123 billion over the next 10 years. That means Medicare Part B would lose about $31 billion in premiums starting in fiscal year 2013, The Hill reports.

Nursing home groups worry any future Medicare cuts would derail the long-term care industry. But some analysts argue that automatic reductions are preferable to other deficit reduction strategies.