Safety Net Hospitals Raise Concerns on DSH Cuts

The fate of the PPACA remains in the hands of the U.S. Supreme Court, which is expected to rule this month on the constitutionality of the sweeping healthcare reforms. With so much uncertainty surrounding the law, Feldpush says there has been some reluctance to implementing key provisions that could help safety net hospitals.

"We know for certain that at least on the health exchange side the implementation in states is going a little slower," Feldpush says. "Obviously they have been bogged down by the constitutional challenges to the law. There are a lot of states that have not moved quickly either because they are opposed to the exchanges or they are not sure it is going to remain in the law. That is all happening slower than people had anticipated."

NAPH this month released a study showing that the nation's safety net hospitals represent 2% of all acute care hospitals, but delivered 20% of all uncompensated care in 2010. NAPH said its annual member characteristics report, America's Safety Net Hospitals and Health Systems, 2010, found that its member hospitals delivered increasing levels of outpatient and inpatient services and uninsured patients accounted for 30% of ambulatory care visits and 19% of inpatient services.

The 52-page report said that the average margin for NAPH hospitals was 2.3% in 2010, compared with 7.2% for all hospitals. Safety net hospitals would have suffered a 6.1% loss without Medicaid DSH payments and a 10.6% loss without DSH and other supplemental Medicaid payments, the report said.