Safety Net Funding for Uninsured in Doubt

Each year, hospitals in Massachusetts contribute $165 million to fund the Health Safety Net Trust Fund – a pool of money that helps pay for the care received by the hundreds of thousands of low-income Massachusetts residents who are uninsured or underinsured. Health insurers also contribute $165 million annually to the Health Safety Net, and the state itself, by law, is required to contribute $30 million. Hospitals are then additionally required to make up any shortfall in the program when costs exceed the required funding assessments. This year, the shortfall is estimated to be $65 million.
Yet, the state has regularly declined to make its statutory transfer to the Health Safety Net despite recent directives from the legislature to do so. In FY2019, the legislature directed the state to commit “up to” a reduced $15 million in funding. Despite clear legislative intent, no transfer has been made since FY2015, as the administration has viewed the “up to” language as permissive in nature. As a result, MHA will be working with legislative champions in the House to strengthen the FY2020 budget directive in a manner that will ensure the administration fulfills the $15 million transfer to the Health Safety Net that the House sought in its budget proposal.
The House Ways & Means budget also contains language that the governor included in his proposal that would allow an annual transfer of money from the Health Safety Net into a Medicare savings program to help certain elderly residents pay for care. In a communication to legislators, MHA said it “supports the coverage expansion for seniors; however, funding transfers from the Health Safety Net are not an appropriate or sustainable funding source and will create instability in the Health Safety Net program.”