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Hospitals Expected to Take a Hit

Published on October 31, 2019 
by CoverMe Team
A person holding a tab with the display of the year and a laptop on the table with data displayed along with pie charts and bar graphs

Reimbursement for Federal Hospital Expected to Take a $252B Hit by 2029

A recent study has found that 12 pieces of legislation and regulatory changes are estimated to decrease federal hospital reimbursement from 2010-2029.

Twelve legislative acts, as well as regulatory changes from CMS, are estimated to reduce federal hospital reimbursement by $252.6 billion by 2029, a new report from the health economics consulting firm Dobson | DaVanzo and Associates showed.

The study, which was commissioned by the Federation of American Hospitals (FAH) and the American Hospital Association (AHA), examined how 12 legislative Acts combined with numerous regulatory changes would affect hospital funding between 2010 and 2029.

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“Hospitals are nearing the tipping point we have predicted for so long. The disruptions that come with Medicare and Medicaid cuts of this magnitude have a real-world impact on our ability to deliver the vital services to the patients and local communities that depend on us,” Rick Pollack, AHA president and CEO

Other laws and policies reducing federal hospital reimbursement by over $252 billion by 2029 included:

  • Medicaid Disproportionate Share Hospital Payment reductions, $25.6 billion
  • Off-campus provider-based department payment cuts, $23.7 billion
  • Long-term care hospital cuts, $8.1 billion
  • Post-acute care payment updates, $7.3 billion
  • Hospital transfer policy, $6.2 billion
  • Medicare payment cuts for bad debt, $5.7 billion
  • 3-day window, $4.2 billion

These billions of dollars in cuts spell trouble for hospitals and health systems, as many struggle with declining reimbursements for service providers. Pollack believes enough is enough with the report revealing “very serious challenges to ensure access to care.” He continues to be hopeful about the future of healthcare.

“Hospitals and health systems are doing more to meet the needs of patients and communities than ever before,” he stated. “They not only work to ensure the highest quality care in delivering essential public services, but also address the social determinants of health, community, violence, and ensure they are always there and ready to care in the case of any emergency.”

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Written by CoverMe Team
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