GAO Responds to Senators Grassley and Wyden on DSH Payments

In response to an inquiry by Senators Chuck Grassley (R-IA) and Ron Wyden (D-OR), the Government Accountability Office (GAO) issued a report examining Medicaid disproportionate share hospital (DSH) payments. ANCOR is sharing this report because disproportionate share hospitals support populations, including people with disabilities, who receive most of their health care supports through the Medicaid program.

In summary:

“Across states, GAO found that total DSH payments varied significantly in 2014. DSH payment levels are generally tied to state DSH spending in 1992 and since 1993 states have been subject to a limit on the amount of federal funding that may be used for DSH payments.

[…]

The amount of DSH payments made to hospitals varied significantly by state. Among hospitals receiving DSH payments, nationally:

• Medicaid DSH payments covered 51 percent of the uncompensated care costs. In 19 states, DSH payments covered at least 50 percent of uncompensated care costs.
• DSH payments comprised about 14 percent of total Medicaid payments, yet wide variation existed. For example, DSH payments comprised about 97 percent of Medicaid payments to DSH hospitals in Maine and 0.7 percent of Medicaid payments to DSH hospitals in Tennessee.

Some types of hospitals received a greater proportion of DSH payments relative to their share of total uncompensated care costs. For example, states generally provided more DSH payments to public hospitals (in comparison to private and non-profit hospitals) and teaching hospitals (as compared to non-teaching hospitals) relative to their share of total uncompensated care costs.”