Recently, we described how the Affordable Care Act (ACA) is squeezing public and private nonprofit hospitals’ finances—making hospitals’ continued access to 340B drug discounts more important than ever. This past Saturday, the front-page lead story in The New York Times took an in-depth look at how two SNHPA member hospitals in Georgia are struggling to cope with ACA’s cuts in Medicaid disproportionate share hospital (DSH) payments, which help defray the cost of uncompensated and undercompensated care.
The Medicaid DSH payment cuts are hitting hospitals hardest in the 26 states that have decided not to expand Medicaid eligibility. These hospitals are seeing as many uninsured patients as ever, but getting less aid to help care for them.
Both SNHPA member hospitals featured in the Times article—Memorial Health in Savannah and Grady Health in Atlanta—provided moving testimonials on how Medicaid DSH cuts will lead to reduced services, including cancer care. Memorial Health’s tumor clinic, one of the few in Georgia that accepts poor and uninsured patients, will be forced to reduce its services. A third of Grady Health’s patients are uninsured, and the hospital predicts its outpatient mental health program, which handles 58,000 visits a year, would be hardest hit by the cuts. The Times article vividly describes the patients being served by these 340B hospitals and what these cuts will mean for them.
The Medicaid DSH cuts “are just one of the reductions in government reimbursements that are squeezing hospitals across the country,” the Times wrote. “Some have already announced layoffs.”
Indeed, just yesterday, The Washington Post reported that MedStar Washington Hospital Center in the District of Columbia, also a SNHPA member, “is cutting jobs because of mounting financial pressures.”
“Like other hospitals in the region and across the country, MedStar Washington has been hurt by cuts in reimbursement from Medicare and Medicaid,” the newspaper said, as well as by the bankruptcy of a once-prominent Medicaid contractor for the district that “stopped paying for care that the hospital provided to its members.”
These stories underscore how important the 340B program will be to patients and the providers that serve them for decades to come.