After passage of legislation that could see provider revenues fall by up to $1 trillion, the AHA is vowing to continue the fight. AHA President and CEO Rick Pollack discussed how the hospital industry advocate is preparing for upcoming legislative battles.
American Hospital Association President and CEO Rick Pollack called the recent passage of the One Big Beautiful Bill Act (OBBBA) "extremely disappointing," but vowed to continue fighting to mitigate the impact on providers and patients.
The Medicaid cuts included in the bill, along with the expiration of Affordable Care Act tax credits, could cause provider revenues to fall by as much as $1 trillion, according to an estimate from the Urban Institute and the Robert Wood Johnson Foundation.
"Despite months of clearly demonstrating the implications that these Medicaid proposals would have on the patients and communities we serve, particularly vulnerable populations, Congress enacted these significant cuts," Pollack said during a conversation with AHA Chair Tina Freese Decker. The result will be the displacement of 11.8 million people from healthcare coverage.
Small wins prevented further harm
While the outcome was not what the hospital industry had hoped for, Pollack emphasized that the AHA was successful in preventing an even worse scenario. The association established key priorities, including preventing the implementation of block grants or per capita caps and preserving the core structure of provider tax and state-directed payment programs.
AHA advocacy also resulted in some crucial concessions. The effective dates for the cuts to provider taxes and state-directed payments were delayed until 2028, and the reductions will be phased in over several years to avoid an abrupt financial shock for providers.
"One of the small wins, I think it's actually a big one, was preventing it from even being worse," Pollack said, noting that his team successfully killed a "very dangerous amendment" that would have further cut federal matching funds to states.
Looking ahead to the next legislative battle
With the bill now law, the AHA’s immediate focus is twofold: helping its members manage the new reality and preparing for the next round of legislative battles. The association is developing guidance to help hospitals understand the law’s implications and is working to share best practices on revenue cycle improvements and operational efficiencies to help providers absorb the financial impact.
Pollack expects the upcoming legislative fight over a government funding bill will serve as the vehicle for several other critical healthcare provisions, including the extension of telehealth waivers, the renewal of the hospital-at-home program, and the prevention of looming Medicaid Disproportionate Share Hospital cuts.
"We’ve got to make sure that the government funding package, which is really the forcing event, includes these important issues and they're going to want to offset the cost of this," Pollack warned. "We’ve got to make sure that site neutral and 340B doesn't creep in as an offset."
For Pollack, the path forward relies on grassroots advocacy from hospital leaders. He stressed that when legislators don't hear from their constituents, they assume everything is OK.
"Grassroots is king. Grassroots is absolutely king," he said, urging leaders to continue telling the stories of how these cuts will impact the real people they serve.
Luke Gale is the revenue cycle editor for HealthLeaders.
KEY TAKEAWAYS
While the AHA's advocacy led to crucial concessions, such as delaying the effective dates of provider tax cuts until 2028, the recently passed law will still have a significant impact on provider revenue and healthcare coverage.
The AHA's immediate focus is on helping members manage the new reality by sharing best practices for revenue cycle improvements and operational efficiencies to help absorb the financial impact of the cuts.
The next major legislative battle will be the fall government funding bill, where the AHA will fight to protect telehealth waivers and prevent looming DSH cuts.