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ANNAPOLIS, Md. (AP) — The Maryland Hospital Association urged a state commission on Thursday to spare hospitals from a 2 percent Medicare cut that is part of federal budget reductions.

In response to the recommendation by staff members of the Health Service Cost Review Commission to have hospitals absorb the cuts for the rest of the fiscal year, the group issued a report warning the panel about deteriorating financial health of hospitals in the state. The report said the percentage of hospitals experiencing negative operating margins have climbed from 17 percent in 2011 to more than 40 percent in the first half of fiscal year 2013.

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