Part two of the Trump administration’s proposed FY 2020 budget brought more potential bad news for private safety-net hospitals.

 

Last week’s “lean budget” released by the White House included a number of challenges for private safety-net hospitals and this week’s release, intended to fill in some of the blanks that last week’s document left, brought more of the same.

Proposed Medicare challenges include:

• a call for establishing a new process for calculating Medicare disproportionate share (Medicare DSH) uncompensated care payments
• slashing Medicare bad debt reimbursement from 65 percent to 25 percent
• continued movement toward site-neutral payments for outpatient services provided at hospital outpatient facilities

Newly proposed Medicaid challenges include:

• extending Medicaid disproportionate share (Medicaid DSH) cuts beyond the currently planned six years
• redesigning the formula for allocating Medicaid DSH funds to the states
• authorizing states to verify beneficiaries’ Medicaid eligibility more than once a year
• permitting states to apply means tests to Medicaid eligibility

The latest FY 2020 budget proposal also calls for:

• consolidating Medicare, Medicaid, and children’s hospital medical education payments into single new capped medical education grant program
• reduced 340B prescription drug discount program payments for some hospitals
• reducing the grace period for payment of premiums for health insurance purchased on an insurance exchange
• income-based increases in premiums for low-cost insurance purchased on those exchanges

All of these changes, if implemented, would pose problems for NASH members and most private safety-net hospitals.

Learn more from this week’s White House budget document.