Now into the first week of the federal government spending cuts forced by “The Sequester,” the immediate impact in Lee’s Summit is slight.
But there will be pain as mandatory cuts started March 1 trickle down to Lee’s Summit R-7 School District, and for doctors and hospitals in the form of lower Medicare reimbursements, and smaller city grants.
The Lee’s Summit R-7 School District expects cuts to affect their finances by nearly a quarter million dollars.
Currently, the district receives approximately four percent of its funds from the federal government with approximately 67 percent coming from local sources and around 29 percent from the state.
“It is our understanding that the sequester cuts will impact approximately 5.3 percent of school districts’ federal funding, which amounts to potential losses of almost $225,000 for Lee’s Summit R-7,” district spokeswoman Janice Phelan said. “At this time, R-7 officials have not been notified of specific amounts or specific areas for these cuts.”
Phelan added no specific information has been provided by federal or state government on which school year – this year’s or next – the cuts would impact, although preliminary information indicated that the cuts would not impact the current 2012-13 year.
“The majority of federal funds received by the R-7 school district go toward special-education programs,” she said. “At this time, there are no plans to make adjustments to student programs for the 2012-13 based on the preliminary information received. R-7 officials are continuing to monitor this situation.”
Lee’s Summit city officials are mostly monitoring possible cuts to various grant programs.
It’s known that the Community Development Block Grants, used by Lee’s Summit to support a variety of charities and other programs to support moderate-to-low income neighborhoods will lose money.
The CDBG funding in 2013 is estimated to be 5 percent less than in 2012, when the city received $288,907.
The Planning and Development Department will continue to monitor whether the across the board cuts will mean a bigger reduction. The Department of Homeland Security has state and local programs losing $117 million, including grant programs that might affect money the Lee’s Summit Fire Department could be eligible for.
A big item affecting Lee’s Summit residents and businesses will be Medicare reimbursements to providers, which will be reduced by 2 percent starting on April 1.
Cuts to services to individual Medicare recipients were specifically exempted by Congress, but providers would get less money for those treatments and their reimbursements could be delayed.
It will affect drug companies and health plans as well. It would take about $11 billion from Medicare and from implementation of the Affordable Care Act implementation programs.
“It’s difficult to know what kind of impact the sequester will have on local hospitals. There are many moving parts with national and state funding for health care. Our hospital is committed to providing quality, cost-effective care so we will lead through these changing times,” said Jackie DeSouza, CEO of Lee’s Summit Medical Center.
According to a study funded by the American Hospital Association, the predicted fallout is a loss of 496,000 jobs in 2013 in what was a fast-growing sector of the economy.
Losses would come in hiring freezes, layoffs, holds on expansion and other delays for hospitals and private practices.
Officials from Truman Medical Center-Lakewood did not respond to requests for comment
In a statement, Saint Luke’s Health System, which owns St. Luke’s Hospital-East, said it strongly supports an expansion of health insurance coverage to the uninsured and the underinsured.
“Because the federal Affordable Care Act contemplates extending coverage for low wage families and childless low wage workers though an expansion of the state Medicaid programs, the federal payments we now receive to help us defray the cost of caring for the uninsured are being sharply reduced and phased out. Without the offsetting revenue from more insured patients, our hospitals will be forced to make difficult choices going forward – which could include deferring capital investments and equipment upgrades, and possible discontinuation of programs and services for which revenues are insufficient to sustain costs,” St. Luke’s statement read.