The Medicaid and CHIP Payment Access Commission (MACPAC) has released its March 2017 Report to Congress, which includes the commission’s statutorily required annual analysis of Medicaid disproportionate share hospital (DSH) payments.

The report features two chapters focused on the commission’s DSH analysis — the first features new data on the Affordable Care Act’s (ACA’s) effects on hospitals, and the second reviews various approaches to better targeting DSH payments. The commission’s analysis found that uncompensated care payments declined 9.3 percent between 2013 and 2014, with the largest declines in states that adopted the ACA’s Medicaid expansion. However, hospitals that serve a safety-net role continue to face financial distress.

In reviewing ways to better target DSH payments, commission staff estimated the effects of raising the minimum federal eligibility criteria to a higher standard by examining the effects of seven different use-based thresholds. States currently are permitted to make DSH payments to any hospital that has a Medicaid inpatient utilization rate of 1 percent, which includes almost all hospitals nationwide. Due to wide variations between hospitals and across states, the commission’s analysis found it difficult to identify a single utilization-based standard applicable to all hospitals that would be an improvement over current law.

The report also includes the commission’s January recommendations regarding the future of the Children’s Health Insurance Program (CHIP), with funding for the program set to expire in October. The final chapter focuses on how states monitor access to care for Medicaid beneficiaries.

Contact Director of Policy Erin O’Malley at eomalley@essentialhospitals.org or 202.585.0127 with questions.