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Hospitals Estimate ACA Repeal Will Cost Them Billions


December 07, 2016

A recent report released by the American Hospital Association (AHA) and the Federation of American Hospitals (FAH), that examined the impact of the potential repeal of the Affordable Care Act (ACA), found that the net impact on hospitals between 2018 and 2026 could total an estimated $165 billion if the repeal reinstates rollbacks on payments.

“Losses of this magnitude cannot be sustained and will adversely impact patients’ access to care, decimate hospitals’ and health systems’ ability to provide services, weaken local economies that hospitals help sustain and grow, and result in massive job losses,” Rick Pollack, president and CEO of the AHA, and Chip Kahn, MPH, president and CEO of the FAH, wrote in a press release. “As you know, hospitals are often the largest employer in many communities, and more than half of a hospital’s budget is devoted to supporting the salaries and benefits of caregivers who provide 24/7 coverage, which cannot be replaced.”

The report estimated the impact of  “repeal and delay,” using the previously vetoed legislation HR 3762 as a template. They found that hospitals would face $165.8 billion over seven years after accounting for Medicaid cuts. The report also found that under the ACA repeal, hospitals would suffer a loss of approximately $289.5 billion in Medicare inflation updates if payment reductions in the ACA are not restored. Furthermore, the report found that the impact of retaining the Medicare and Medicaid disproportionate share hospital reductions would amount to $102.9 billion.

Additionally, the report highlighted the cumulative federal payment reductions to hospital services that have been imposed through Congressional and Executive Branch actions that are separate from the ACA. The reductions alone total approximately $148 million from 2010 to 2026—topping the ACA reductions.

The report also reveals that if the ACA is repealed, the number of uninsured would increase by 22 million people by 2026.

“As you begin reconsideration of the ACA, we want to be a constructive partner in this discussion,” Mr Pollack, and Mr Kahn wrote in a press release. “We strongly believe that any repeal legislation must be accompanied by provisions that protect the coverage for those currently receiving such protection.”

Mr Pollack and Mr Kahn have committed to work with President-elect Donald Trump and Congress to ensure proper funding for hospital services.

Julie Mazurkiewicz

References:

American Hospital Association. New Report Outlines Impact of Potential ACA Repeal on Hospitals and Health Systems [press release]. November 2016.

Dobson DaVanzo & Associates. Estimating the Impact of Repealing the Affordable Care Act on Hospitals. http://www.aha.org/content/16/impact-repeal-aca-report.pdf. November 2016.

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