$2B in DSH payment cuts set to kick in Oct. 1

Disproportionate Share Hospital payments — allotments established under Medicaid and Medicare to offset a portion of uncompensated care at hospitals that serve a disproportionate share of low-income patients — will be cut by $2 billion Oct. 1 without legislative action, according to STAT.

With the expectation of lower uninsured rates and lower levels of hospital uncompensated care, the ACA adjusted the available amounts of DSH funding. With the Supreme Court ruling that threw out the mandate for Medicaid expansion and the uncertainty regarding the ACA's future, safety-net hospitals are stuck in an unintended policy gap, according to STAT.

The ACA calls for aggregate reductions to DSH payments annually from fiscal year 2014 through fiscal year 2020. Subsequent legislation delayed the start of the reductions until fiscal year 2018, which begins Oct. 1, and pushed the end date back to fiscal year 2025. DSH payments would be gradually reduced by a total of $43 billion over the eight-year period.

"If these cuts move forward, it's be going to be very hard for safety-net hospitals to continue to offer services to those in their communities who otherwise don't have access to everything from primary care visits to emergency care services," Beth Feldpush, senior vice president of policy and advocacy for America's Essential Hospitals, which advocates for safety-net hospitals, told STAT.

While the Oct. 1 deadline looms, three congressmen are attempting to delay the DSH payment cuts by circulating a letter urging the House to delay cuts again. More than 150 members of congress signed the letter as of Friday, according to STAT.

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