A nationwide group composed of providers, payers, governmental agencies, and organized labor involved in Medicaid-related advocacy, on Monday expressed concern over impending reimbursement cuts to disproportionate-share hospitals, known as DSH hospitals.
The leaders of The Partnership for Medicaid sent a letter to Sens. Mitch McConnell and Chuck Schumer and Reps. Nancy Pelosi and Kevin McCarthy, who are the Senator Majority Leader and Minority Leader, and House Speaker and Minority Leader, respectively. Addressing those congressional leaders, the Partnership for Medicaid leaders wrote, “On behalf of the Partnership for Medicaid—a nonpartisan, nationwide coalition of health care providers, safety-net health plans, counties, and labor—the undersigned organizations wish to express our concern about the impending cuts to Medicaid disproportionate share hospital (DSH) payments.”
As they noted, “Safety-net hospitals across the country, which rely on DSH payments, face severe cuts at the end of this fiscal year. Under current law, beginning Oct. 1, 2019, DSH hospitals will be hit with a $4 billion cut—a third of program funding. Medicaid DSH payments,” they noted, “were created to sustain hospitals that serve a disproportionate number of low-income and uninsured patients. These hospitals, which treat the most vulnerable, in both urban and rural communities nationwide, absorb the bulk of the country’s uncompensated care and treat a large share of Medicaid enrollees. DSH payments remain critical to allowing these facilities to continue serving their communities and fulfilling their safety-net mission.”
What’s more, the Partnership for Medicaid leaders wrote, “In its March 2019 Report to Congress, the Medicaid and CHIP Payment and Access Commission (MACPAC) found that deemed DSH hospitals would have had a negative 6 percent operating margin in 2016 if they had not received Medicaid DSH payments. MACPAC’s analysis also found that, in 2014—the first year in which coverage was expanded under the Affordable Care Act—hospital uncompensated care actually increased. The growth in Medicaid shortfall was larger than the decline in uncompensated care for the uninsured, leading to the net increase. The MACPAC analysis shows that Medicaid DSH payments are still needed to supplement the shortfalls faced by hospitals that care for Medicaid and uninsured patients. Medicaid DSH payments are vital for the stability and viability of these hospitals—the hospitals that care for the nation’s most vulnerable patients, provide highly specialized, lifesaving services, train the next generation of clinicians, and perform a myriad of other services relied on by communities across the country.”
