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Essential Hospital Leaders Call on Congress to Stop Medicaid DSH Cuts


WASHINGTON — Leaders of more than 250 hospitals and health systems nationally that care for uninsured and other vulnerable patients have urged Congress to stop looming cuts to Medicaid funding that supports the nation’s safety net.

In a letter to House and Senate leaders, the hospitals warned of the “far-reaching effects” of a $2 billion reduction Oct. 1 in Medicaid disproportionate share hospital (DSH) payments, saying the cut would “limit your constituents’ access to care and hurt our local economies, including by eliminating jobs.”

Hospitals that care for people who face economic and social hardships rely on DSH payments for some relief from uncompensated care costs. The Affordable Care Act (ACA) significantly cut DSH, assuming coverage expansion would reduce those costs. But with 19 states still opposing Medicaid expansion, uncompensated care costs remain high — $35 billion annually — while DSH cuts remain in place, creating an imbalance that falls hardest on essential hospitals.

The DSH cuts, totaling $43 billion through 2025, will reduce access to care for low-income patients and jeopardize “essential services to our communities, including top-level trauma, burn, and neonatal intensive care,” the hospital leaders wrote.

Congress, in strongly bipartisan votes, has delayed the DSH cuts since fiscal year 2014, recognizing the disparity between projected and actual coverage increases under the ACA. The hospitals urged continued cooperation, calling on lawmakers to “collaborate and work swiftly to stop the cuts … and delay the onset of such reductions by at least two years.”

“Given the high levels of uncompensated care across the country—both in states that have expanded their Medicaid programs under the ACA and those that have not—Medicaid DSH cuts simply cannot be justified,” the hospitals wrote. “In a time of substantial instability within the health care system, it is imperative that Congress continue the delay of Medicaid DSH cuts. Our hospitals need financial certainty to continue providing needed services to our disproportionately disadvantaged patients.”

The hospitals, members of America’s Essential Hospitals and others, on Sept. 12 sent the letter to Senate Committee on Finance Chair Sen. Orrin Hatch (R-UT) and ranking member Sen. Ron Wyden (D-OR), and to House Committee on Energy and Commerce Chair Rep. Greg Walden (R-OR) and ranking member Rep. Frank Pallone (D-NJ).

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About America’s Essential Hospitals
America’s Essential Hospitals is the leading association and champion for hospitals and health systems dedicated to high-quality care for all, including the most vulnerable. Since 1981, America’s Essential Hospitals has initiated, advanced, and preserved programs and policies that help these hospitals ensure access to care. We support members with advocacy, policy development, research, and education.

Our more than 300 members are vital to their communities, providing primary care through trauma care, disaster response, health professional training, research, public health programs, and other services. They innovate and adapt to lead the broader health care community toward more effective and efficient care.

Carl Graziano


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