With under two weeks left in the fiscal year, Congress wants to use a continuing budget resolution as a temporary delay to the Medicaid disproportionate share hospital cuts slated to start Oct. 1.
Three sources familiar with the discussions said the $4 billion in DSH cuts will be delayed only for the time period of the continuing resolution. Two people confirmed that the continuing resolution is expected to run through Nov. 21. That would secure hospitals' first-quarterly payments which are distributed by the states.
The goal is to buy time for the committees to work on the bigger spending package and avert a government shutdown. Bipartisan Senate negotiations over HHS appropriations fell apart, teeing up another complicated battle to fund the government.
Senate Finance Committee Chair Chuck Grassley (R-Iowa), who wants to see reforms to the Medicaid DSH formula, told Modern Healthcare on Tuesday that discussions are still ongoing about potential changes to the program.
The current formula, which skews funding significantly for certain states over others, hasn't changed since 1992. Hospital groups agreed to cuts to the program under the Affordable Care Act as one of the trade-offs for policies like Medicaid expansion, but have successfully secured delays ever since.
Extending the current delay is one of the biggest lobbying priorities for national hospital trade groups and hospital groups in states like New York, Alabama and Missouri that get the biggest share of federal dollars and therefore have the most to lose.
But policymakers and staff who are still hoping the impending cuts can force some adjustments to the current program.
"It would be helpful if hospitals came to the negotiating table ready to discuss the matter in a reasonable way without trying to backtrack on their commitments made during the ACA debate," said Michael Zona, spokesperson for Grassley.
