The Obama administration's proposed Medicare cuts of $2 billion over 10 years to critical-access hospitals were criticized by the National Rural Health Association as being unrealistic and not easily workable.

The president’s proposed budget for 2013 includes the suggestion to reduce critical-access hospitals’ Medicare reimbursement to 100% of reasonable costs from its current 101% of costs, and to prohibit critical-access hospital designation for facilities within 10 miles from the nearest rural hospitals.

The CAH change would save $1.4 billion over 10 years, and the 10-mile rule would save $590 million, according to the estimates from the Office of Management and Budget.

Both proposals were in the president’s proposed budget last year and both were eliminated by Congress, so it’s unclear why they were included again this year, said Alan Morgan, CEO of the NRHA. The budget doesn’t say whether the 1% proposed cut would come in addition to a 2% cut pending as a result of last year’s Budget Control Act, and there are difficult implementation issues facing the 10-mile rule, Morgan said.

“I’m inclined to think the administration hasn’t put a lot of thought into this proposal,” Morgan said.