[Congressional Record Volume 147, Number 53 (Wednesday, April 25, 2001)]
[Senate]
[Pages S3926-S3927]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. BINGAMAN (for himself Mr. Enzi, Mr. Baucus, and Mr. 
        Wellstone):
  S. 776, A bill to amend title XIX of the Social Security Act to 
increase the floor treatment as an extremely low DSH State to 3 percent 
in fiscal year 2002; to the Committee on Finance.
  Mr. BINGAMAN. Mr. President, I rise today to introduce legislation 
with Senators Enzi, Baucus, and Wellstone, entitled the ``Medicaid 
Safety Net Hospital Improvement Act of 2001.'' This legislation is 
absolutely critical to the survival of many of our nation's safety net 
hospitals. It would provide additional funding to address their growing 
burden of providing uncompensated care to many of our nation's 42.6 
million uninsured residents, including 463,000 in New Mexico, through 
the Medicaid disproportionate share hospital, or DSH, program.
  In recognition of the burden bourne by hospitals that provide a large 
share of care to low-income patients, including Medicaid and the 
uninsured, the Congress established the Medicaid DSH program to give 
additional funding to support such ``disproportionate share'' 
hospitals. By providing financial relief to these hospitals, the 
Medicaid DSH program maintains hospital access for the poor. As the 
National Governors' Association has said, ``Medicaid DSH's funds are an 
important part of statewide systems of health care access for the 
uninsured.''
  Recent reports by the Institute of Medicine entitled ``America's 
Health Care Safety Net: Intact But Endangered,'' the National 
Association of Public Hospitals entitled ``The Dependence of Safety Net 
Hospitals'' and the Commonwealth Fund entitled ``A Shared 
Responsibility: Academic

[[Page S3927]]

Health Centers and the Provision of Care to the Poor and Uninsured'' 
have all highlighted the importance of the Medicaid DSH program to our 
health care safety net.
  As the Commonwealth Fund report, which was released just this last 
week, notes: ``The Medicaid DSH program has had a beneficial effect on 
patient access. The average payment rate for Medicaid inpatient 
services has increased dramatically. Medicaid payments for hospital 
services were only 76 percent of the cost of providing this care in 
1989. By 1994, Medicaid payments had increased to 94 percent of 
costs.''
  Unfortunately, as the Commonwealth Fund report adds, ``. . . there 
are large inequities in how these funds are distributed among states.'' 
In fact, for 15 states, including New Mexico, our federal DSH 
allotments are not allowed to exceed 1 percent of our state's Medicaid 
program costs. In comparison, the average state spends around 9 percent 
of its Medicaid funding on DSH. This disparity and lack of Medicaid DSH 
in ``extremely low-DSH states'' threatens the viability of our safety 
net providers. In New Mexico, these funds are critical but inadequate 
to hospitals all across our state, including University Hospital, 
Eastern New Mexico Regional Hospital, St. Vincent's Hospital, Espanola 
Hospital, and others.
  In an analysis of the Medicaid DSH program by the Urban Institute, 
the total amount of federal Medicaid DSH payments in six states was 
less than $1 per Medicaid and uninsured individual compared to five 
states than had DSH spending in excess of $500 per Medicaid and 
uninsured individual. That figure was just $14.91 per Medicaid and 
uninsured person in New Mexico. Compared to the average expenditure of 
$218.96 across the country, such disparities cannot be sustained.
  As a result, this bipartisan legislation increases the allowed 
federal Medicaid DSH allotment in the 15 ``extremely low-DSH states'' 
from 1 percent to 3 percent of Medicaid program costs, which remains 
far less, or just one-third, of the national average. I would add that 
the legislation does not impact the federal DSH allotments in other 
states but only seeks greater equity by raising the share of federal 
funds to ``extremely low-DSH states.''
  Once again, the Commonwealth Fund recommends such action. As the 
report finds, ``States with small DSH programs are not permitted to 
increase the relative size of their DSH programs .  .  . [C]urrent 
policy simply rewards the programs that acted quickly and more 
aggressively, without regard to a state's real need of such funds.'' 
Therefore, the report concludes, ``.  .  . greater equity in the use of 
federal funds should be established among states.''
  Again, this is achieved in our legislation by raising the limits for 
``extremely low-DSH states'' from 1 percent to 3 percent and not by 
redistributing or taking money away from other states.
  Failure to support these critical hospitals could have a devastating 
impact not only on the low-income and vulnerable populations who depend 
on them for care but also on other providers throughout the communities 
that rely on the safety net to care for patients whom they are unable 
or unwilling to serve.
  As the Institute of Medicine's report entitled ``America's Health 
Care Safety Net: Intact But Endangered'' states, ``Until the nation 
addresses the underlying problems that make the health care safety net 
system necessary, it is essential that national, state, and local 
policy makers protect and perhaps enhance the ability of these 
institutions and providers to carry out their missions.''
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 776

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Medicaid Safety Net 
     Improvement Act of 2001''.

     SEC. 2. INCREASE IN FLOOR FOR TREATMENT AS AN EXTREMELY LOW 
                   DSH STATE TO 3 PERCENT IN FISCAL YEAR 2002.

       (a) Increase in DSH Floor.--Section 1923(f)(5) of the 
     Social Security Act (42 U.S.C. 1396r-4(f)(5)) is amended--
       (1) by striking ``fiscal year 1999'' and inserting ``fiscal 
     year 2000'';
       (2) by striking ``August 31, 2000'' and inserting ``August 
     31, 2001'';
       (3) by striking ``1 percent'' each place it appears and 
     inserting ``3 percent''; and
       (4) by striking ``fiscal year 2001'' and inserting ``fiscal 
     year 2002''.
       (b) Effective Date.--The amendments made by subsection (a) 
     take effect on October 1, 2001, and apply to DSH allotments 
     under title XIX of the Social Security Act for fiscal year 
     2002 and each fiscal year thereafter.

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