Congressional inaction will hurt NH hospitals

Lawmakers must act now to delay cuts in Medicaid payments to hospitals

While Washington debates the nuances of broader healthcare policy, uninsured Americans are still turning to local hospitals to access basic care, and these hospitals are still on the hook for covering those costs. But if Congress doesn’t act soon, funding for the program that helps keep these hospitals could lapse, affecting dozens of hospitals across New Hampshire and the thousands of Granite Staters who rely on them.

Costs of care not covered by Medicaid, Medicare or private insurance have a significant financial impact on hospitals. This impact is lessoned in large part thanks to the Medicaid Disproportionate Share Hospital, or DSH, program, which provides crucial funding to hospitals to help offset those uncompensated care costs. Without this critical funding, hospitals might have to stop providing services, lay off staff or raise costs. Though the DSH program is a crucial part of keeping safety-net hospitals open and running, the 116th Congress has not made funding for it a legislative priority.

President Reagan created the DSH program in 1985 to support hospitals that serve a disproportionate number of uninsured patients and low-income patients. The Affordable Care Act called for a reduction in DSH program funding, with the assumption that Medicaid expansion would reduce the number of uninsured Americans. The logic was that hospitals would need less DSH funding as the uninsured rate dropped.

However, implementation of the ACA and the subsequent expected insured rate did not happen as Congress initially hoped, leading to a postponement of the scheduled reduction.

While the national healthcare debate often stalls along partisan lines, the DSH program is unique in that it enjoys support across both sides of the aisle. Congress first delayed implementation of the cuts in 2013 in an overwhelmingly bipartisan vote, and has delayed them each year since, most recently in the budget agreement Congress passed in 2018. However, time is running out for 2019; if Congress does not act soon, $7 billion in cuts to the DSH program will go into effect on October 1, 2019.

In New Hampshire, DSH cuts would have an enormous impact on hospitals serving lower-income community members. New Hampshire’s current annual DSH allotment is $377.6 million, which 29 medical facilities rely on to keep their doors open and provide quality care to low-income patients. If Congress fails to delay cuts soon, these hospitals could lose $106.4 million in funding the first year — a whopping 28% reduction in funding — and double that amount the following year.

These cuts are simply unsustainable for safety-net hospitals, and would force them to cut services, raise rates, or both, resulting in higher premiums, job losses, and in some cases, hospital closures. Lower-income Granite Staters who depend on their local hospitals will be forced to find care elsewhere or pay more for the care they need, and communities whose economies rely on local hospitals would suffer. Healthcare leaders, advocacy groups and industry experts all widely oppose DSH cuts and agree that Congress must take action to delay them.

Why continue delaying something that can be dealt with now? With continued uncertainty about funding worrying consumers and providers alike, Congress must work now — not later — to ensure continued funding for the DSH program and its vital support for New Hampshire hospitals and the communities they serve.

Jayme H. Simões is president of Louis Karno & Company Communications, Concord.