Today, Rep. Nick LaLota (R-Suffolk County) and Rep. Yvette Clarke (D-Brooklyn), joined by Reps. Larry Bucshon, M.D. (R-IN), Doris Matsui (D-CA), Mike Lawler (R-NY), and Frank Mrvan (D-IN), introduced the bipartisan Save Our Safety-Net Hospitals Act to prevent massive cuts to New York hospitals’ Medicaid payments. Specifically, Stony Brook University Hospital is facing a potential $53 million cut in 2024.

“New York's safety-net hospitals, like Stony Brook University Hospital, are the backbone of our healthcare system, providing essential care to our most vulnerable communities. The potential $53 million cut in Medicaid funding threatens the very foundation of these institutions,” said LaLota. “My bipartisan Save Our Safety-Net Hospitals Act would prevent massive cuts to the nation’s most vulnerable hospitals without any cost to the taxpayer and ensure they can continue to deliver critical services. This is a bipartisan and common sense fix to an issue directly impacting hospitals on Long Island and safeguards healthcare access for those who need it most, ensuring that no one is left behind due to bureaucratic oversights.”

“New York’s safety net hospitals are an invaluable resource for our state's most vulnerable patients, and Medicaid DSH funding is necessary for keeping their operations running,” said Clarke. “We cannot stand by as devastating funding cuts loom and threaten the health, wellbeing, and futures of the millions of New Yorkers who rely on these vital hospitals to access the healthcare services they need. I am proud to stand with my colleagues across the aisle in support of a solution that will keep their doors open and protect the underserved patients they care for. The time to pass the SOS Hospitals Act is now.”

“Safety net hospitals in Indiana and across the nation help care for the most vulnerable patients.  As a physician, I know how critical these facilities are, particularly in rural and underserved urban communities,” said Bucshon. “It is critical that these safety net hospitals have the resources they need to provide care for these patients, and Congress must work to ensure the federal government is appropriately providing the resources necessary to support the important work that they do.”

“Achieving health equity requires that our most underserved patients can access high-quality care,” said Matsui. “Low-income older Americans are some of our most medically vulnerable patients — and safety net hospitals are on the front lines of serving this population. This bill will ensure this population can continue to access vital care, while maintaining a sustainable future for these essential providers.”

“Hospitals that serve our most vulnerable populations are facing deep and unnecessary cuts, including hospitals right here in the Hudson Valley,” said Lawler. “We cannot let that happen and that’s why I’m proud to join my colleagues in introducing the Save our Safety-Net (SOS) Hospitals Act. This common sense legislation will ensure these hospitals continue to receive the funding they are due so patients can continue to receive care at these facilities.”

“Thank you to Rep. LaLota and my House colleagues for introducing this legislation to ensure that everyone in our communities has access to the health care services they need,” said Mrvan. “I look forward to continuing to work with all of my House and Senate colleagues to finalize this worthwhile initiative as soon as possible.”

“I am grateful to Rep. LaLota for introducing this critical piece of legislation to protect our nation's safety-net hospitals providing quality care to the patients most in need,” said Carol Gomes, Stony Brook University Hospital CEO and COO. “If Sec. 203 is not amended, Stony Brook University Hospital will incur a $53M reduction in revenue this fiscal year and that reduction will continue to grow into the future. I am urging Congress to support and pass this essential amendment now.”

“I applaud Reps. Nick LaLota, Yvette Clarke, and Mike Lawler for championing the Save Our Safety-Net Hospitals Act, which would safeguard resources essential to preserving care for New York’s most vulnerable populations,” said Bea Grause, RN, JD, President of the Healthcare Association of New York State (HANYS). “This bipartisan legislation would fix an inadvertent cut of Medicaid DSH resources for some New York hospitals that treat a significant portion of Medicaid and Medicare patients. HANYS thanks our delegation members for their leadership in protecting patients’ access to care.”

“This legislation takes an important step toward righting a wrong,” said Wendy Darwell, CEO of the Suburban Hospital Alliance of New York State. “The DSH program compensates hospitals for the extraordinary costs they incur for caring for our most vulnerable residents.  Three years ago, a minor change in law significantly reduced what New York’s hospitals could receive under the program.  Care provided to those who qualify for both Medicare and Medicaid – typically very low-income seniors and the disabled – was no longer counted. The consequence of that change is tens of millions of dollars in cuts to Stony Brook, NUMC, and other public hospitals in New York.  We’re grateful to Congressman LaLota for his initiative to stop these cuts.”

“Medicaid DSH payments are an essential lifeline for New York’s safety net hospitals, but the current DSH cap calculation will severely harm them financially and disrupt access to care,” and Kenneth E. Raske, President of the Greater New York Hospital Association. “The Save Our Safety Net Hospitals Act will help ensure that safety net hospitals can continue to serve the most vulnerable patients and communities. The entire hospital community strongly supports this bill and thanks Representatives LaLota, Bucshon, Clarke, Lawler, Matsui, and Mrvan for their advocacy and leadership.”

“We strongly support legislation introduced today to correct a federal policy that harms the ability of many essential hospitals to recover financial losses they sustain caring for dually eligible Medicaid patients. The Save Our Safety-Net Hospitals Act of 2024 would lift burdensome restrictions on the disproportionate share hospital (DSH) support essential hospitals receive to offset the uncompensated costs of care for patients dually eligible for Medicaid and Medicare or other third-party insurance,” said Bruce Siegel, M.D., President and CEO of America’s Essential Hospitals. “We thank the bill’s sponsors—Reps. Nick LaLota (R-N.Y.), Yvette Clarke (D-N.Y.), Larry Bucshon (R-Ind.), Doris Matsui (D-Calif.), Mike Lawler (R-N.Y.), and Frank Mrvan (D-Ind.)—for their bipartisan leadership in introducing this critically needed legislation. DSH payments are a vital part of the patchwork support essential hospitals rely on to meet their safety net mission. We urge all members of Congress to support the Save Our Safety-Net Hospitals Act and protect access to high-quality, equitable health care for all people and communities.”

“Medicaid DSH payments are a lifeline for many safety-net hospitals and the Save our Safety-Net Hospitals Act recognizes the uncompensated costs incurred by the hospitals serving patients who are dually-eligible for both Medicare and Medicaid,” said Ellen Kugler, Executive Director of the Alliance of Safety-Net Hospitals. “The Alliance of Safety-Net Hospitals appreciates Rep. LaLota’s leadership and is proud to support the Save our Safety-Net Hospitals Act.”

To read the full text of the legislation, click HERE.

Background:

The bill is supported by America’s Essential Hospitals, the Healthcare Association of New York State (HANYS), the Suburban Hospital Alliance of NYS, the Alliance of Safety-Net Hospitals, Nassau-Suffolk Hospital Council, and the Greater New York Hospital Association (GNYHA).

Medicaid Disproportionate Share Hospital (DSH) funding helps preserve access to care at hospitals and health systems that serve the most vulnerable populations. All New York hospitals receive some level of Medicaid DSH funding. Many hospitals rely on this funding to remain operational. DSH caps determine the maximum amount of federal Medicaid DSH funding a hospital can receive. The amount of capped DSH funding has traditionally been based on the financial losses from services provided to uninsured patients, Medicaid enrollees and dual-eligible enrollees (Medicaid patients who also have Medicare or other third-party coverage).

This no-cost bipartisan legislation would mitigate the unintended impact of a provision included in the FY21 Consolidated Appropriations bill. Specifically, it defines the Medicaid shortfall component of the DSH cap to include costs and payments for (a) patients for whom Medicaid is the primary payer, plus (b) unreimbursed costs associated with Medicare duals (if any), plus (c) unreimbursed costs associated with all other duals (if any).

Section 203 of the Consolidated Appropriations Act, 2021 (P.L. 116-260) altered the definition of Medicaid shortfall to calculate the limit on Medicaid disproportionate share hospital (DSH) payments. The new sec. 203 limit excludes costs and payments for Medicaid patients dually eligible for commercial or Medicare coverage, counting only the costs and payments for patients for whom Medicaid is the primary payer or who are uninsured. An unintended consequence of sec. 203 is that it cuts DSH payments for hospitals that incur significant uncompensated costs for their low-income dually eligible Medicare patients. These hospitals have historically relied on Medicaid DSH to support these costs for Medicaid dual patients, but sec. 203 eliminated that source of funding by excluding the costs from the DSH cap.