The state Legislature should alter the way it administers the Medicaid Disproportionate Share Hospital program to better serve the neediest facilities, including NYC Health + Hospitals, the Citizens Budget Commission wrote in a blog post.

In February Congress delayed cuts to the DSH program, which offsets financial losses hospitals incur while caring for Medicaid and uninsured patients, until fiscal year 2020. It was the fourth time they were postponed, but each time they have grown in magnitude. Once they do take effect, hospitals face a $4 billion cut nationwide. New York would face a $724 million one in that first year, which begins Oct. 1, 2019.

As was the case last year, before funding was restored, NYC Health + Hospitals would bear the brunt based on the state's current funding formula. DSH payments cover a smaller portion of Health + Hospitals' losses than they do at other health systems, the CBC wrote.

"The possibility of additional future delays in federal cuts should not be taken as an excuse to postpone reform; existing inequities are already serious, and state leaders should act based on the assumption that current law provisions for cuts will be implemented," wrote CBC research associate Patrick Orecki.

Orecki wrote that the state should change its distribution formula to reflect need, ensure H+H alone doesn't feel the impact and make payments in a timely fashion.

"Continued inaction will compound the financial risk to the state's most significant safety-net health system," he wrote. —

J.L.