America’s Essential Hospitals Disappointed by Administration Proposal to Reverse State Medicaid Payment Flexibility

FOR IMMEDIATE RELEASE

Statement attributable to:
Beth Feldpush, DrPH
Senior Vice President of Policy and Advocacy
America's Essential Hospitals

America's Essential Hospitals is disappointed that the administration is proposing to reverse its own 2018 policy of allowing states to set payment rates at levels that are needed to ensure access to care for Medicaid beneficiaries, particularly in rural communities.

In 2022, essential hospitals reported a total of $22.7 billion in uncompensated care costs, including $10.3 billion in unpaid costs of care for Medicaid patients. State directed payments (SDPs) help states close these gaps in Medicaid payment between Medicaid and other payers. Many SDPs approved by the first Trump administration have allowed states to keep rural hospitals open; reduce infant and maternal mortality; and improve care quality, value, and access in other ways. These programs could be eliminated by this proposed policy reversal.

Almost 12 million Americans have both Medicare and Medicaid benefits. Adequate payments for Medicaid services allow hospitals to preserve access to care for these patients, Medicare beneficiaries, and all patients in their communities. Allowing states flexibility to set Medicaid payment policies in response to local needs is particularly important for services that Medicare doesn't often cover, such as maternity care.

Essential hospitals look forward to working with the administration to identify data-driven ways to advance the president's goal to "love and cherish Medicaid" and protect access to care for Medicaid beneficiaries.

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About America's Essential Hospitals
America's Essential Hospitals is the leading association and champion for hospitals dedicated to high-quality care for all, including those who face social and financial barriers to care. Since 1981, America's Essential Hospitals has advanced policies and programs that promote health and access to health care. We support our more than 350 members with advocacy, policy development, research, education, and leadership development. Communities depend on essential hospitals for care across the continuum, health care workforce training, research, public health, and other services. Supported by Essential Hospitals Institute, the association's research and education arm, essential hospitals innovate and adapt to lead all of health care toward better outcomes and value.

Contact: James SwannDirector of Communicationsjswann@essentialhospitals.org202.585.0102