fah hospital policy blog

Perspectives on health policy affecting America’s hospitals and the patients we serve.

Hospital Funding Study Sponsored by FAH, AHA Grabs Headlines

June 21, 2018 | FAH Policy Blog Team

Category: FAH News, Financing

A new analysis showing that the cumulative reductions in federal payments to hospitals since 2010 will top $218 billion by 2028 continues to grab headlines in leading healthcare publications.

The study from the health economics consulting firm Dobson | DaVanzo and Associates examined how eleven pieces of legislation combined with numerous regulatory changes would affect hospital funding from 2010 through 2028. It was commissioned by the Federation of American Hospitals (FAH) and the American Hospital Association (AHA).

Publications from across the health care sector covered the study’s release.

Politico’s influential Morning Pulse e-newsletter wrote about the report and shared a link to the related infographic.

Healthcare Dive gave unique context to the study’s findings:

“Despite millions of newly insured Americans since the Affordable Care Act (ACA), which helped reduce uncompensated care, other actions from Washington, D.C., have taken money from hospitals. These cuts haven’t been isolated to healthcare legislation. Hospitals have seen reimbursements hit in federal budget bills and legislation that focused on other areas, such as military retirees, tax relief and jobs.”

Becker’s Hospital Review focused on the areas being cut the most:

“The study investigated how new healthcare legislation and regulatory changes have changed hospital funding over time. The study found the three biggest contributors to the payment reductions were $79.3 billion from changes with MS-DRG documentation and coding; $73.1 billion due to federal budget sequestration; and $25.9 billion from lower Medicaid disproportionate share hospital payments.”

Inside Health Policy highlighted the quote from FAH President and CEO Chip Kahn:

“$218 billion is not just a number; the funding reductions it reflects have real world consequences for patients. Losses of this significance simply cannot be sustained and will affect the ability of hospitals to meet the expectations of the patients and communities we serve.”

You can view the entire report by clicking here.