Are we destined to repeat the same mistakes because of the “Better Rebuild Act”?


Like the previous “Affordable Care Act” and other landmark social spending measures, the Human Infrastructure Act now in Congress, the “Rebuild Better Act”, will lower the barriers to affordable health care for millions of Americans. This is a commendable goal and a welcome goal for safety net hospitals in caring for low-income and marginalized patients in the country.

However, these hospitals may become victims of another feature shared by the “Rebuild Better Act” and ACA: an optimistic coverage forecast, and experience tells us that it may not meet expectations.

In more than a dozen states that refuse to expand the Medicaid program, the bill will extend the coverage of the ACA market to those who are in the coverage area-whose income is too high to qualify for Medicaid but the income is too low to receive ACA market tax The person who is credited. But for hospitals with the mission of a safety net, this is a double-edged sword: Based on the assumption that more insured patients will offset the loss, the Rebuild Better Act will also cut payments in these states to support safety net care.

ACA has adopted a similar strategy, albeit on a national scale. In both cases, the key lies in Medicaid’s disproportionate shared hospital (DSH) payment, which is the lifeline of hospitals that care for a large number of uninsured and underinsured patients. The “Better Rebuild Act” will further restrict federal contributions to several states’ funding pools for unpaid hospital care expenses.

Although it has achieved all the benefits—including adding tens of millions of Americans to the ranks of insureds—the ACA has yet to meet the coverage forecasts of its creators. However, these initial estimates justified the substantial reduction in Medicaid DSH. Recognizing the difference between the assumption and the actual situation, Congress wisely delayed the reduction of Medicaid DSH and recently cancelled some of it altogether.

This experience makes Congress even more frustrated, and the government is ready to pass the “Rebuild Better Act” to repeat history. The estimated $4.7 billion reduction in DSH and the additional reduction in the unpaid care pool failed the test of sound policies in many ways.

The main argument against spending cuts is that they will punish hospitals for national policy decisions beyond their control, thereby harming the patients the bill aims to help. The Rebuild Better Act is opposed to states that insist on expansion, but it strikes directly at suppliers who have little say in expansion decisions. To make matters worse, by cutting back on critical support for the safety net, the bill would jeopardize the care of people of color and others who have suffered disproportionately during the pandemic, diminishing the benefits that may be realized from expanded equity coverage. The legislation will also have a detrimental effect, making the hospitals with the least resources and the poorest patients pay for expansion-which is hardly a matter of promoting fairness.

The cut failed in other ways. The policy does not take into account fluctuations in the Medicaid population or the cost of unpaid care (ACA adopted the same approach to its Medicaid DSH reduction). In addition, if there is no data to show that such interruptions serve the best interests of Medicaid or its beneficiaries, it will force major and costly changes. The policy will also set a disturbing precedent for penalizing states that choose not to take action on alternative plan designs.

To make this all the more complicated, the hospitals most in need of safety net support may not see the increase in commercial insurance patients promised by the Rebuild Better Act. The Urban Research Institute recently studied this issue and concluded that the benefits of the bill “will not necessarily flow to hospitals that will maintain a reduction in DSH allocation. Therefore, some hospitals may be made worse by the proposed changes.” Not encouraging, especially as basic hospitals continue to struggle against the heavy economic losses caused by COVID-19.

As policymakers strive to provide health insurance to more people, they must remain awake about the prospects of benefiting everyone, and remember the need for a strong safety net when hope fails. They can start by rejecting the hospital cuts in the Better Rebuild Act.



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