Mr. President, I support the Medicare, Medicaid, SCHIP Extension Act of 2007. I appreciate the hard work and leadership of Senators Baucus and Grassley in putting together this important legislation that will improve Medicare reimbursements, extend the State Children’s Health Insurance Program, and extend other important Medicare and Medicaid policies.
Mr. President, in addition, this legislation includes a provision that extends Medicaid disproportionate share hospital (DSH) allotments for Hawaii and Tennessee for another six months. Medicaid DSH resources help support hospitals that care for significant numbers of Medicaid and uninsured patients.
Hawaii and Tennessee are the only two states that do not have permanent DSH allotments. The Balanced Budget Act of 1997 created specific DSH allotments for each state based on their actual DSH expenditures for FY 1995. In 1994, Hawaii implemented the QUEST demonstration program that was designed to reduce the number of uninsured and improve access to health care. The prior Medicaid DSH program was incorporated into QUEST. As a result of the demonstration program, Hawaii did not have DSH expenditures in 1995 and was not provided a DSH allotment.
The Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000 made further changes to the DSH program, which included the establishment of a floor for DSH allotments. However, states without allotments were again left out.
The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 made additional changes in the DSH program. This included an increase in DSH allotments for low DSH states. Again, states without allotments were left out.
In the Tax Relief and Health Care Act of 2006, DSH allotments were finally provided for Hawaii and Tennessee for 2007. The Act included a $10 million Medicaid DSH allotment for Hawaii for 2007. The Medicare, Medicaid, and SCHIP Extension Act of 2007 will extend the DSH allotments for Hawaii and Tennessee for an additional six months.
This extension authorizes the submission by the State of Hawaii of a state plan amendment covering a DSH payment methodology to hospitals which is consistent with the requirements of existing law relating to DSH payments. The purpose of providing a DSH allotment for Hawaii is to provide additional funding to the State of Hawaii to permit a greater contribution toward the uncompensated costs of hospitals that are providing indigent care. It is not meant to alter existing arrangements between the State of Hawaii and the Centers for Medicare and Medicaid Services (CMS) or to reduce in any way the level of federal funding for Hawaii’s QUEST program.
I look forward to continuing to work with Senators Alexander, Corker, and Inouye to permanently restore allotments for Hawaii and Tennessee. I thank the Chairman and Ranking Member of the Finance Committee for all of their efforts on this legislation and for their support on this issue of great importance.
Thank you, Mr. President.
