Hospitals urge Congress to repeal Medicaid DSH cuts

Hospitals are calling on federal lawmakers to repeal $4 billion in cuts to Medicaid Disproportionate Share Hospital payments scheduled for fiscal year 2020.

They are seeking the repeal as CMS on Sept. 23 issued a final rule detailing how the $4 billion in cuts will be implemented beginning Oct. 1. The final rule also details how $8 billion in cuts to Medicaid DSH payments each fiscal year from 2021 to 2025 would be implemented.

"We're pleased the final methodology [from CMS] encourages states to target Medicaid DSH payments to hospitals caring for the most low-income patients. But that does not lessen the urgent need for relief from damaging DSH cuts. Our hospitals and their communities depend on DSH — not only to care for vulnerable patients but to maintain services for everyone," Beth Feldpush, senior vice president of policy and advocacy for America's Essential Hospitals, told Becker's Hospital Review.

Under the Medicaid DSH program, hospitals that serve a large number of Medicaid and uninsured patients receive payments to help cover the costs of caring for them. Assuming uncompensated care costs would decline as the number of insured people increased when the ACA became law, the law lowered Medicaid payments to hospitals that serve a disproportionate share of low-income patients.

CMS issued a final rule in 2013 to implement cuts to DSH funding, but lawmakers have repeatedly delayed the federally required cuts.

Now, Congress once again is considering a delay of the fiscal year 2020 cut in payments. The full House has passed a resolution, and the U.S. Senate is expected to take it up this month.


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