Two states with hospitals facing huge DSH cuts

Hospitals in states not expanding Medicaid under the Affordable Care Act are beginning to acknowledge the fiscal difficulties they will face once disproportionate share hospital (DSH) cuts kick in next year, the New York Times reported.

The Times focused on Georgia, one of the anti-ACA states. It reported that leading institutions in the state, such as Memorial Health in Savannah, are considering cutting back on cancer care. The medical center is one of the few providers in the state with a tumor clinic that accepts uninsured patients.

"We were so thrilled when the law passed, but it has backfired," Lindsay Caulfield, senior vice president for planning and marketing at Grady Health in Atlanta, told the Times. That hospital is looking at a possible $50 million loss in DSH payments in 2014, about half of its total funding under the program. About half of Grady's patients are uninsured.

So far this year, three hospitals in rural Georgia have closed their doors due to financial hardships.

Hospitals in other anti-ACA states are facing a similar predicament. In Virginia, the University of Virginia Medical Center stands to lose as much as $140 million by the end of the decade, the Daily Progress reported. The Charlottesville-based facility relies on DSH money to help fund its program for medical residents.

A recent report by Fitch Ratings concluded that hospitals in states that do not expand their Medicaid programs will have to cut back on services in order to remain financially competitive.

Georgia Gov. Nathan Deal, a Republican, is opposed to expanding Medicaid under the ACA. He suggested that hospitals in states that do not expand Medicaid should not have their DSH payments curtailed. His spokesman, Brian Robinson, told the Times that the federal government is to blame for the predicament.

"The state is sitting here, a victim of a crime, and you're asking the victim, 'Why did you let yourself get mugged?' " he said.

Although hospital lobbies have called on Congress to try and make changes to the DSH funding guidelines under the ACA, Republicans in the House have resisted doing so, according to the Times.

To learn more:
- read the New York Times story
- here's the Daily Progress story

 

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