Advocacy Alert

Urge Your Lawmakers to Support Essential Health System Designation

Essential Hospitals Call on Congress to Stop Medicaid DSH Cuts

September 14, 2023


Statement attributable to:
Bruce Siegel, MD, MPH
President and CEO
America’s Essential Hospitals

WASHINGTON — More than 250 hospitals and health systems that care for low-income and marginalized patients and provide essential community services have urged Congress to stop looming cuts to key federal support for the nation’s health care safety net.

In a letter to House and Senate leaders, essential hospitals warned of the “far-reaching effects” of scheduled deep cuts to Medicaid disproportionate share hospital (DSH) funding, including an $8 billion reduction Oct. 1 — more than two-thirds of all federal Medicaid DSH dollars in fiscal year (FY) 2024.

“These cuts would undermine America’s health care safety net and significantly reduce our hospitals’ ability to provide lifesaving services to the communities you represent,” the hospitals warned. The cuts “would limit your constituents’ access to care and hurt our local economies, including through job losses.”

Essential hospitals care for many uninsured and underinsured people and provide vital services, such as trauma, burn, and neonatal intensive care, to entire communities. They rely on DSH payments to help offset their high uncompensated care costs, which average nearly $63 million per hospital — more than seven times that of other U.S. hospitals, America’s Essential Hospitals data show.

The DSH cuts — totaling $32 billion over the next four fiscal years — are mandated in federal law and based on an assumption of health insurance coverage increases that have not materialized. Congress, recognizing this disparity, has delayed or eliminated Medicaid DSH cuts in strongly bipartisan votes nearly a dozen times since FY 2014. In their letter, the hospitals called on lawmakers to act again this year.

“At a time of substantial instability within the health care system, it is imperative Congress continue to delay and eliminate Medicaid DSH cuts,” they wrote. “Our hospitals need the financial certainty such action would bring to continue providing needed care to the disadvantaged patients they disproportionately serve.”

The hospitals sent the letter to Senate Majority Leader Chuck Schumer (D-N.Y.) and Minority Leader Mitch McConnell (R-Ky.); and House Speaker Kevin McCarthy (R-Calif.) and Minority Leader Hakeem Jeffries (D-N.Y.).

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About America’s Essential Hospitals
America’s Essential Hospitals is the leading association and champion for hospitals dedicated to equitable, high-quality care for all, including those who face social and financial barriers to care. Since 1981, America’s Essential Hospitals has advanced policies and programs that promote health, health care access, and equity. We support our more than 300 members with advocacy, policy development, research, education, and leadership development. Communities depend on essential hospitals for care across the continuum, health care workforce training, research, public health and health equity, and other services. Essential hospitals innovate and adapt to lead all of health care toward better outcomes and value.

Carl Graziano

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