Federal Legislative Priorities
HAP works with national health care organizations—particularly the American Hospital Association—and national coalitions to ensure federal policy supports Pennsylvania hospitals as they transform the health care system to improve patient care. HAP spearheads an informal coalition of more than 30 Pennsylvania health care provider organizations that work together to advance policy goals consistent with a shared commitment to promoting coverage and improving health outcomes for the citizens of Pennsylvania.
Medicaid Disproportionate Share Hospital (DSH) Program Cuts
The Medicaid Disproportionate Share Hospital (DSH) program provides payments to hospitals that serve a high proportion of Medicaid beneficiaries and uninsured patients. The payments are essential for hospitals to offset their uncompensated care costs from treating low-income patients. A series of payment cuts are scheduled for Fiscal Years 2020 through 2025, beginning with a $4 billion reduction during 2020. HAP opposes the deep payment cuts, which if put in place, would reduce Pennsylvania’s Medicaid DSH allotment by approximately $242 million during FY 2020.
Preserving Payments for Legitimate Differences Between Sites of Care
A recent payment policy issued by the Centers for Medicare & Medicaid Services (CMS) expands the application of so-called “site-neutral” payments, cutting the payments hospitals receive for outpatient clinic visits.
So-called “site-neutral” payments policies reimburse hospitals for services across various sites of services at payment levels irrespective of the critical role hospitals play in our health care system—providing emergency standby services and specialized services such as trauma, psychiatric, obstetrics, and pediatric emergency care; treating more vulnerable patients; adhering to strict regulatory requirements that protect health and safety; and serving as the backbone of our emergency preparedness infrastructure.
The hospital community challenged the payment policy and a federal judge has ruled in favor of the American Hospital Association and other hospital plaintiffs, saying CMS did not have the authority to implement these new site-neutral payment cuts. Despite the judge's ruling, the 2020 final rule for the Medicare Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment System and quality reporting programs retained a two-year phase-in of the “site neutral” policy. The rule takes effect January 1, 2020.
340B Drug Pricing Program
The 340B Drug Pricing Program helps hospitals that care for large numbers of uninsured and low-income patients and serve rural communities to manage the impact of high cost drugs by purchasing discounted medications from drug manufacturers. Savings are used to increase access to care or help patients secure prescription drugs at significantly reduced costs, or no cost at all. A 2018 Medicare regulation implemented reductions in the amount of the savings hospitals can recoup and reinvest in health care. The 2020 final rule for the Medicare Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment System and quality reporting programs continues to reduce hospital reimbursement by maintaining a nearly 30 percent pay cut to certain participants in the federal 340B Drug Pricing Program, despite a federal judge's ruling against the reductions during both 2018 and 2019. HAP opposes the reductions that undercut the value of a crucial program helping hospitals and patients manage the burden of high prescription drug costs.
HAP urges 340B hospitals to sign the 340B Good Stewardship pledge.
Get more details about these federal priorities and other key health care issues at the HAP Resource Center.