The report highlights the financial challenges many safety net hospitals are under to provide uncompensated care despite the millions who have received health coverage through the Patient Protection and Affordable Care Act.
The narrow margins that many safety-net hospitals work under could become worse without the continued funding support from Medicaid disproportionate-share payments, which provide hospitals serving large low-income populations funding to reimburse the expense of uncompensated care. Without DSH payments, the average operating loss for America's Essential Hospitals members grows to 8%.
"Our member hospitals remain cornerstones of community health, not only for the uninsured and other vulnerable people, but for anyone who needs lifesaving services," said Dr. Bruce Siegel, CEO of America's Essential Hospitals. "They have not wavered from this commitment, even in the face of heavy financial challenges."
DSH payments have been slated to be based on the theory that the increase in those covered would reduce the need for such funding. In its final Medicare payment rule for fiscal 2015 issued Monday, CMS reduced DSH payments to hospitals by 1.3% (PDF).
Total spending on uncompensated care reached nearly $85 billion in 2013, according to a study published in May in the journal Health Affairs.
Medicare and Medicaid DSH payments paid for 41%, or $21 billion, of uncompensated care in 2013, with the bulk of such care paid by hospitals, which provided $44 billion, according to that study.
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