A new report prepared for The Commonwealth Fund Commission on a High Performance Health System offers a series of recommendations to help shore up the finances of safety-net hospitals and promote their ability to provide high-quality care to low-income, vulnerable patients once the health reform law is fully implemented.
According to the report, "Toward a High Performance Health Care System for Vulnerable Populations: Funding for Safety-Net Hospitals," by Deborah Bachrach and colleagues at Manatt Health Solutions, safety-net institutions face a number of challenges, both short- and long-term.
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The report calls on state Medicaid departments to increase reimbursements for safety-net hospitals serving the largest numbers of Medicaid patients. However, increased rates should be tied to delivering high-quality and efficient care, the report noted.
The Commonwealth Fund also calls for more precise targeting of Medicare and Medicaid disproportionate share hospital (DSH) payments, especially given health reform will cut billions in DSH payments over the next 10 years. Both Medicare and Medicaid DSH payments should be directed at uninsured patients, as well as linked to specific services provided to specific uninsured patients.
Noting that most safety-net hospitals lack the operating margins to invest in advanced technologies, implement new delivery models and upgrade their infrastructure, the report recommends using Medicaid waivers to allocate the necessary funding to safety nets, citing success in New York and California.
In New Jersey, Governor Chris Christie is addressing the state's disproportionate share healthcare payments, proposing a plan to share $675 million in charity care payments more equitably among hospitals, according to a press release.
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Roughly 90 percent of the funds will be fixed at fiscal year 2012 allocations, while the other 10 percent will be shifted away from hospitals that treated relatively fewer uninsured patients between 2009 and 2010, according to the New Jersey Hospital Association in a written statement.
Read more about the report at commonwealthfund.org.
Follow HFN associate editor Kelsey Brimmer on Twitter @kbrimmerHFN.