The Greater New York Hospital Association made approximately $6 million in 2020 membership dues voluntary as hospitals brace for Medicaid reimbursement cuts.
New York's Medicaid program expenses are running up to $4 billion over budget, which triggered an interim 1% reduction in payments on Jan. 1. GNYHA responded by making the dues voluntary for its New York members, as well as its member hospitals in New Jersey, Connecticut and Rhode Island.
"No matter how fierce our advocacy will be—and it will be—Medicaid cuts will certainly occur and they will be severe," said GNYHA president Kenneth Raske, adding that a formal budget decision is expected in two weeks. "It would be totally inconsistent with our DNA to send safety-net institutions serving vulnerable populations a bill for dues knowing full well they may have to lay off a caregiver in order to pay it."
Hospitals and doctors continue to warn that Medicare and Medicaid reimbursement rates are unsustainable as costs to treat beneficiaries exceed payments. As lawmakers and healthcare stakeholders discuss a single-payer system and reference-based pricing models, they've debated what reimbursement levels are financially sustainable.
Meanwhile, hospitals have successfully lobbied to continue to delay Medicaid disproportionate-share hospital payment reductions. Raske said GNYHA will fight for a multi-year extension.
The cuts were implemented as part of the Affordable Care Act with the expectation that uncompensated care would decrease as more people gained insurance coverage. Although, uncompensated care as a percent of hospital expenses has increased over the past several years in some states, and decreased in others, according to Modern Healthcare Metrics data.
Hospitals dealt with a $19.7 billion Medicaid shortfall in 2018, according to a new report from the American Hospital Association. Hospitals received payment of 89 cents for every dollar spent on care for Medicaid beneficiaries, the AHA found.
"If it wasn't for the ability for hospitals to cost shift to their commercial insurance base, they could not have a sustainable economic model," Raske said.
