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Perspectives on health policy affecting America’s hospitals and the patients we serve.

Health Care Coalition Asks Congress to Delay Medicaid DSH Cuts

September 18, 2017 | FAH Policy Blog Team

Category: Affordable Care Act, Medicaid

A coalition made up of groups from across the spectrum of health care, including the Federation of American Hospitals, sent a letter to members of the House and Senate on Monday asking for a delay in the start of Medicaid disproportionate share hospital (DSH) cuts.

The Medicaid DSH program assists hospitals serving high numbers of Medicaid and uninsured patients. Currently, about half of all hospitals in the United States receive DSH payments to address Medicaid underpayment and uncompensated care, which allow them to provide critical community services such as trauma and burn care, high-risk neonatal care and disaster preparedness resources.

The letter outlines why the cuts need to be delayed:

“The Affordable Care Act (ACA) reduced payments to the Medicaid DSH program under the assumption that uncompensated care costs would decrease as health care coverage increased. The reductions are now scheduled to begin on Oct. 1, 2017 at $2 billion.

“Unfortunately, the coverage rates envisioned under the ACA have not been fully realized, and tens of millions of Americans remain uninsured. In addition, Medicaid underpayment continues to pose ongoing financial challenges for hospitals treating our nation’s most vulnerable citizens. Congress recognized the need for the Medicaid DSH program to continue to be fully funded by delaying the start of the cuts over the past four years.”

Joining FAH in signing the letter was America’s Essential Hospitals, American Hospital Association, Association of American Medical Colleges, Catholic Health Association of the United States, Children’s Hospital Association, National Association of Psychiatric Health Systems, Premier Healthcare Alliance and Vizient, Inc.

You can view copies of the letter here.