Wednesday, May 14th 2003

The Honorable Jeff Bingaman
United States Senate
703 Hart Senate Office Building
Washington, DC 20510

Dear Senator Bingaman:

On behalf of our many hospitals, health care systems, networks and other providers of care, we are writing to express our strong support for your Medicaid Disproportionate Share Hospital program (DSH) amendment to be offered when the Senate considers the "Jobs and Growth Tax Act of 2003."

This amendment would restore fiscal year (FY) 2003 Medicaid DSH funding cut as a result of the Balanced Budget Act of 1997 (BBA).  Because of BBA, safety net hospitals are facing a $1 billion loss resulting from (FY) 2003 cuts in Medicaid DSH payments - a loss they can ill afford.  In addition, this amendment would alleviate some pressure and allow "extremely low-DSH states" to increase Medicaid DSH program spending to 3 percent of Medicaid program costs in FY 2004.  Currently, federal law restricts Medicaid DSH allotments to "extremely low-DSH states" to only 1 percent of Medicaid program costs.

Today, safety net hospitals face a confluence of challenges - including increased uncompensated care as more Americans find themselves without health insurance - that put critical pressure on hospitals' ability to serve their entire communities.  Your amendment would help hospitals continue their mission of providing quality health care for all Americans.

Again, we strongly support your Medicaid DSH amendment and will work to help ensure its passage and enactment.


American Hospital Association
Association of American Medical Colleges
Catholic Health Association of the United States
Federation of American Hospitals
National Association of Children's Hospitals
National Association of Public Hospitals and Health Systems


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