Congress should eliminate the Medicaid DSH and UC cuts in the Build Back Better Act.
In the most recent version of the Build Back Better Act, states that have yet to expand their Medicaid program face reductions in federal Medicaid disproportionate share hospital (DSH) allotments and federal funding for uncompensated care pools. The AHA estimates, based on available data, that the reduction in federal DSH spending for the non-expansion states would be $4.7 billion over 10 years. In addition, if a state that currently expanded its Medicaid program chooses to discontinue expansion, its federal DSH allotment would also be reduced. These provisions should be eliminated from the bill. Proposing cuts to hospitals and health systems that have continuously provided care for uninsured and other vulnerable patients is extremely short-sighted.
The Medicaid DSH program provides essential financial assistance to hospitals that care for our nation’s most vulnerable populations – children, the poor, the disabled and the elderly. These hospitals also provide critical community services, such as trauma and burn care, high-risk neonatal care and disaster preparedness resources. Congress has long understood the importance of the Medicaid DSH payments and has repeatedly delayed the start of the ACA-mandated cuts as the coverage rates envisioned under the law have not been fully realized. These payments remain important for all hospitals and the patients they serve – and they remain especially important in those states that did not expand their Medicaid programs.
“Its conclusion — that hospitals would see a financial 'windfall' — is flawed on several levels,” Aaron Wesolowski, vice president for policy research, analytics and strategy at the AHA, writes. “To draw such a bold and flip conclusion about a massively complicated matrix of coverage and payment using strung-together data and faulty assumptions is irresponsible.”
"We have no guarantee that people are going to enroll. We have no coverage numbers. We just have certainty of a cut," said Stacey Hughes, the AHA's executive vice president.