HAP's Latest News

HAP Advocacy Letter: Protect Pa. Hospitals from Medicare Cuts

Revenue loss would strain hospitals already facing dire financial challenges from COVID-19

June 01, 2022

HAP and Pennsylvania’s hospital community are urging federal lawmakers to protect hospitals from harmful Medicare cuts that threaten their ability to care for patients.

In a letter released today to the Pennsylvania Congressional delegation, HAP and more than 160 hospitals warned lawmakers that cuts to Medicare funding would result in hundreds of millions in losses for Pennsylvania hospitals as they work to recover from the historic revenue losses and increased expenses during COVID-19.

Lawmakers must act now to protect hospitals from a Medicare sequestration cut that resumed during April and potential revenue reductions stemming from the Statutory Pay-As-You-Go Act of 2010 (PAYGO), the letter said.

“Hospitals operate on tight margins where cost shifting is not an option,” the letter said. “This kind of drastic decline in funding puts Pennsylvania hospitals at risk.”

In the letter, HAP and a coalition of hospitals emphasized:

  • Annually, the 2 percent Medicare fee-for-service payment cut amounts to $176 million for Pennsylvania hospitals and $4.7 billion nationwide
  • Failure to waive PAYGO will result in an estimated loss of more than $350 million for Pennsylvania hospitals in fee-for-service payments during 2023
  • The relief that Congress provided through the Provider Relief Fund and through halting these payment cuts has been critical to supporting hospitals’ COVID-19 response and remains paramount to their ability to provide patient care
  • A drastic decline in funding puts Pennsylvania’s hospitals at risk

In a message last week in the Wall Street Journal, American Hospital Association President and CEO Rick Pollack outlined the “tsunami of financial challenges” facing U.S. hospitals while calling for the harmful Medicare cuts to be reversed.

“Hospitals and health systems are the cornerstones of their communities, and patients depend on them for access to care 24 hours a day, seven days a week,” Pollack said. “We must make sure hospitals have the resources — today, tomorrow and in the future — as we work to advance health in America.”

With COVID-19 cases increasing again across the nation, now is not the time for additional Medicare payment cuts. HAP will continue this critical advocacy work to ensure hospitals have the resources they need to deliver outstanding care in their communities.

For more information, contact John Myers, HAP’s vice president, federal advocacy.