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Health Affairs Podcast Explores Financial Strain on Essential Hospitals

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January 24, 2023

In “A Disproportionate Share,” a three-part series from the Health Affairs Pathways podcast, an association member physician breaks down the role essential hospitals play in caring for the nation’s underrepresented populations and the complex patchwork of payments that keep them afloat.

In the second episode, Beth Feldpush, DrPH, senior vice president of policy and advocacy at America’s Essential Hospitals, underscores the fragile financial nature of essential hospitals in a talk with Michael Shen, MD, a primary care physician at association member NYC Health + Hospitals.

“I often describe seeking financing as sort of a Jenga tower of financing. It all gets patched together to help these hospitals make their mission,” explains Feldpush.

The patchwork, which includes Medicare and Medicaid payments, supplemental disproportionate share hospital (DSH) payments, and upper payment limit payments, is vulnerable even to the smallest cuts by Congress and the administration.

“If you start to pull bricks or planks out of that structure, you can only take so many out before the whole thing crumbles down,” Feldpush says.

Without Medicaid DSH payments, for example, the average operating margins for members of America’s Essential Hospitals would drop from 3.2 percent to -0.1 percent.

Throughout the series, Shen examines the history behind the payment policies in place, often rooted in racial and socioeconomic segregation. The final episode will discuss the future of DSH payments.

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