Medicaid DSH Payments To Hospitals

May 9, 2019

What is Medicaid DSH?

  • The Medicaid disproportionate share hospital (DSH) program provides payments to safety net hospitals that serve a high proportion of Medicaid beneficiaries and uninsured patients.
  • The payments are essential for these hospitals to offset their uncompensated care costs from treating low-income patients.

What Crisis do DSH Hospitals Face?

Congress has not yet acted to delay DSH payment cuts, amounting to $12 billion nationally over two years, putting these hospitals at risk.

Why does Medicaid DSH Matter?

  • DSH funding is critical for hospitals in rural and low-income areas to maintain the level of service they provide to their communities, many of whom are underinsured and uninsured.
  • Safety net hospitals may be forced to close if they lose DSH funding.
  • Low-income, underinsured, and uninsured patients could be left without care if DSH-funded hospitals close.

Medicaid DSH in New York

  • New York relies on nearly $3.8 billion in DSH payments annually
  • The $12 billion in DSH cuts are scheduled to go into effect on October 1, 2019, with an initial $4 billion cut, and then $8 billion annually through 2025.