‘Safety-net’ hospitals serve critical need
There’s no disputing the fact that the debate over the newest Affordable Care Act repeal proposal, the bill popularly known as Graham-Cassidy, got all the press in Washington D.C. in the past week.
But bubbling right below the surface is a threat to a critically important — but overlooked — federal program that could hit tens of thousands of low-income Pennsylvanians where they live if Congress fails to act.
Since the 1980s, so-called “safety net” hospitals that serve a large number of lowincome patients, whose coverage is not covered by such third-party payers as Medicaid, Medicare or CHIP, have annually received payments to help offset the uncompensated care they provide to these patients.
Taken together, Pennsylvania hospitals currently receive about $609 million in these of “disproportionate share payments,” with such providers as Pinnacle Health and Geisinger receiving more than $14 million in such assistance, according to the most recent data.
According to published reports, thanks to a quirk in the Affordable Care Act’s implementation, these payments were set to be gradually reduced over eight years.
For each of the last three years, lawmakers authorized extensions.
Unless Congress acts, the first of a total of $43 billion in payment cuts will kick in starting Oct. 1.
That’s a reduction of about 19 percent nationwide, the data shows. And industry advocates say the cuts, if they’re allowed to proceed, would be devastating.
“If these cuts move forward, it’s 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, an industry advocate for America’s Essential Hospitals, told the trade publication, STAT, this week.
Pennsylvania hospitals stand to lose about $121 million in fiscal 2018 if the payments are not extended.
According to data compiled by the Hospital and Healthsystem Association of Pennsylvania, the reductions in payments to Keystone State hospitals are expected to increase annually, hitting a high of $500 million by fiscal 2024.
That’s a hit they can ill afford.
In fiscal 2016, 49 Pennsylvania hospitals, or 29 percent of those statewide, posted negative margins.
Such a dramatic reduction in financial support could lead some of those hospitals to dramatically reduce services or to close their doors entirely, the trade association warned in a position paper.
Unlike most issues on Capitol Hill, the debate over these payments is not a partisan one.
The most recent payment extension, approved in 2015, passed the U.S. Senate by a vote of 92-8 in the Senate and by a vote 392-37 in the House.
At the time, Pennsylvania’s two United States Senators, Democrat Bob Casey and Republican Pat Toomey, both voted to reauthorize the payments.
A spokesman for Toomey said Friday that the Lehigh Valley Republican is “closely examining how the Graham-Cassidy proposal, which would undo Obamacare’s (disproportionate share language) for certain states, would affect Pennsylvanians.”
A spokeswoman for Casey said he continues to support extending the payments.
Congress should move to reauthorize the extension of these payments. And Toomey should join Casey and remain a ‘yes’ vote.
Such a dramatic reduction in financial support could lead some hospitals to dramatically reduce services or to close their doors entirely.