Senate Bill Would Delay DSH Cuts for 2 Years

November 08, 2023

The U.S. Senate Finance Committee unanimously advanced a health care bill that would delay $8 billion in funding cuts for Pennsylvania’s safety-net and rural hospitals for two years.

During a markup session, U.S. Senator Bob Casey (D-PA) led action to include the proposed two-year delay for scheduled cuts to the Medicaid Disproportionate Share Hospital (DSH) program. The two-year delay is one of the key provisions included in the Better Mental Health Care, Lower-Cost Drugs, and Extenders Act, which advanced through committee 26–0.

This year, HAP, Casey, and other members of Pennsylvania’s congressional delegation have urged federal lawmakers to take action to prevent the DSH program cuts that would jeopardize access to care in communities across the commonwealth.

“This will help to ensure the financial viability of many our nation’s safety-net hospitals,” Casey said this morning. “Without the provision, access to care for some of the most vulnerable Americans would be threatened.”

Here’s what you need to know:

• About DSH:  The proposed cuts to the Medicaid DSH program were part of the Affordable Care Act (ACA), with the reasoning that hospitals would have less uncompensated care as health insurance coverage increased.
  • The potential ACA cost savings have not been realized, and cuts to the DSH program would have a devastating impact on Pennsylvania’s safety-net hospitals, which provide trauma and burn care, high-risk neonatal care, and disaster preparedness resources in their communities.
• The impact:  Without action, the Medicaid DSH cuts would amount to $8 billion for each of the next four fiscal years (2024–2027).
• Quotable:  “Pennsylvania’s hospital community applauds Senator Casey’s leadership to preserve access to health care in underserved communities,” HAP President and CEO Nicole Stallings said. “Many safety-net hospitals and rural community hospitals depend on Medicaid DSH payments to remain financially sustainable as they provide essential care for patients and their communities.”
• Other items:  The bill also seeks to promote telehealth access for behavioral health care and reduce prescription drug costs for Medicare Part D beneficiaries, among other initiatives.

Additional information about the bill is available online.

HAP thanks lawmakers for their bipartisan support for this important issue and access to care in Pennsylvania’s safety-net hospitals. For more information, contact John Myers, vice president, federal advocacy.