Has the ACA Put Public Well-Being at Risk?

Over the past few weeks, we have been exploring some of the arguments for and against the ACA, and the possible victories and consequences of its implementation. Today, we’re looking at what some experts say is the biggest victim of the ACA ruling; safety-net hospitals.

These facilities – defined as a hospital that “provides a significant level of care to low-income, uninsured, and vulnerable populations” – will soon be facing the full brunt of a financially-poor populace. One rule in the ACA allowed states to individually choose whether or not to expand Medicaid to their populations. Already, thirty states are threatening to reject Medicaid expansion, and some experts worry that other states will follow their example.

What makes this such a huge problem?

Safety-net hospitals rely on the Medicaid Disproportionate Share Hospital Program (DSH) to care for their patients. The program provides financial assistance to hospitals that serve large numbers of uninsured or low-income patients. Part of the ACA’s budget-cutting plan involves the steady decrease of payments made to the DSH program. That means that already struggling safety-net hospitals will be serving masses of people, with even less funding than they have now.

Bruce Siegel, President and CEO of the National Association of Public Hospitals and Health Systems, believes that this “double-whammy” of ACA rules represents a grievous oversight by the Supreme Court.

The question for us is, how can (the federal government) make the Medicaid expansion optional but leave these enormous disproportionate share fund (DSH) cuts that are in the Affordable Care Act. The ACA cuts the DSH funds by about half, and though it's phased in, you're looking at cuts of over $5 billion a year when the cuts are maxed...$5.6 billion by 2019 per year. Safety net hospitals depend on that money to care for uninsured patients and were banking on the coverage expansion to make up for that loss of money.

So what we're seeing now, and if you cut the DSH, it will be a disaster, a disaster for the safety net and a disaster for patients. You can have a safety net for public hospitals or you can have Medicaid coverage. One or the other. But what's happening is that we are walking away from both.

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Pam Argeris is a thought leader in the Healthcare Industry and possesses extensive, hands-on experience with CMS compliance, and multiple regulatory bodies such as NCQA, JACHO, and DOI. In her role at Merrill Corp., Pam focuses on developing solutions for compliance and quality assurance, delivered in a cost effective manner to improve beneficiary and prospect communications. You can contact Pam at Pamela.Argeris@merrillcorp.com.