CA State Legislators Urge Delay of Medicaid Safety Net Hospital Cuts

On April 5, 2019, the State Legislature urged the California congressional delegation to delay nearly $500 million in Medicaid Disproportionate Share Hospital (DSH) cuts to California’s safety net hospitals that are slated to begin in October 2019. These cuts affect all of California’s safety net hospitals, including community safety net, public, district and children’s hospitals that serve a disproportionate share of low-income and uninsured Californians.

California’s community safety net hospitals are slated to lose nearly $156 million in funding this year, with additional cuts scheduled to increase significantly FY 2021-2025. Reductions of this magnitude would create severe shortages in high-value care for millions of Californians statewide.

Medicaid DSH funding is critical to California’s safety net hospitals and helps offset low Medi-Cal payments and the cost of providing uncompensated care to their low-income communities. California’s community safety net hospitals provide an average of 88 percent of their care to low-income Medi-Cal, Medicare and uninsured patients, and depend on Medicaid DSH funds to invest in innovative partnerships and programs with partner clinics and community-based organizations to ensure their vulnerable communities receive more coordinated, higher value care in the right setting.

For more information see the California State Senate and Assembly letters to the California congressional delegation.

Following is also the current bipartisan congressional effort to delay the Medicaid DSH cuts led by Congressman Eliot Engel (D-NY) and Congressman Pete Olson (R-TX): Engel-Olson Medicaid DSH Delay Colleague Letter