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The Balanced Budget Act of 1997.

The Balanced Budget Act of 1997 brought about major changes in the way that American healthcare is financed: there were many changes in funding and many new requirements for hospitals and other providers to meet. We are all still living with the consequences of this Act. Outline the key provisions of this Act, and share your own view. Was the Balanced Budget Act of 1997 good for U.S. healthcare or not? Support your position on this legislation.

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BBA 1997 Key Provisions

I. Five Year Savings:
BBA was designed to cut Medicare spending by over 115 billion dollars between 1998 and 2002. Several provisions mandated the following mechanisms of cost cutting: a limit on growth of fee-for-service rates to hospitals and physicians, restructuring of payment to various outpatient clinics, reduction of cost of Medicare managed care plans, and a limit on growth of Medicare managed care plans.

II. Ten year Savings:
BBA was designed to reduce Medicare spending by about 400 billion dollars between 1998 and 2007. In addition to the cumulative effect of the Five Year Savings provisions, ...

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