Noteworthy News

Court Affirms Reform Law, Changes Medicaid Provision

gavelThe Supreme Court has upheld the constitutionality of the 2009 Affordable Care Act – including the much-disputed mandate that everyone obtain health insurance.

The court’s only disagreement with the reform law was with its provision requiring states to expand Medicaid eligibility as a future condition of obtaining federal Medicaid matching funds.  The court ruled that expanding Medicaid eligibility should be optional and that states that choose not to expand their Medicaid programs would still receive the federal matching funds to which they have always been entitled.

In the wake of this decision, NAUH is very concerned about the interplay between the loss of the mandated Medicaid expansion and the Affordable Care Act’s requirement that Medicare disproportionate share (Medicare DSH) and Medicaid disproportionate share (Medicaid DSH) payments be cut significantly in the coming years.  Those cuts were predicated on the Medicaid expansion adding as many as 20 million people to the ranks of the insured, which was expected to provide additional revenue to hospitals that would help offset a reduction in their Medicare DSH and Medicaid DSH revenue.  With the Medicaid expansion now on much less certain footing but almost surely to encompass fewer people than envisioned by the reform law’s authors, NAUH will continue to advocate reversal of the planned cuts in Medicare DSH and Medicaid DSH payments.

In the meantime, it will be interesting to see what the individual states decide to do in light of the enhanced federal matching funds available for those that choose to expand Medicaid eligibility.

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