fah hospital policy blog

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

New Report Shows Cumulative Hospital Cuts Top $218 Billion

June 14, 2018 | FAH Policy Blog Team

Category: Affordable Care Act, Financing, Medicaid, Medicare

The cumulative reductions in federal payments to hospitals since 2010 will reach $218.2 billion by 2028, according to a report released today by the health economics consulting firm Dobson | DaVanzo and Associates.

The study, which was commissioned by the Federation of American Hospitals (FAH) and the American Hospital Association (AHA), examined how eleven pieces of legislation combined with numerous regulatory changes would affect hospital funding from 2010 through 2028.

The leaders of FAH and AHA reacted to the results.

“$218 billion is not just a number; the funding reductions it reflects have real world consequences for patients. Losses of this significance simply cannot be sustained and will affect the ability of hospitals to meet the expectations of the patients and communities we serve. It is critical that going forward policymakers recognize this fact and work with hospitals so we can continue to deliver the 24/7 care Americans deserve,” said Chip Kahn, FAH President and CEO.

AHA President and CEO Rick Pollack added, “Continued cuts of this magnitude represent a troubling trend for hospitals and health systems as many struggle with declining reimbursements for services provided in and out of the hospital. As noted in other recent reports, Medicare margins have hit a ten-year low and almost a third of hospitals now have negative aggregate margins across all payer types. Additional reductions will create challenging and potentially unsustainable financial circumstances that could adversely impact patients’ access to care and the ability of hospitals to provide services.”

A complete copy of the Dobson | DaVanzo study can be found on here. You can also view a newly updated infographic here.