Funds made available through the American Recovery and Reinvestment Act which passed earlier this year

WASHINGTON — U.S. Senators Debbie Stabenow (D-MI) and Carl Levin (D-MI) announced today that Michigan has been allotted an additional $6,489,829 in American Recovery and Reinvestment Act (ARRA) funding through the Department of Health and Human Services to assist hospitals that serve a significantly disproportionate number of low-income or uninsured individuals. The Recovery Act increases the allotment available to Michigan from approximately $259,593,152 to $266,082,981 for 2009.

“With middle-class families across Michigan struggling, losing their jobs and their health insurance, our safety-net hospitals continue to face the financial challenge of providing treatment to uninsured, low-income patients,” said Stabenow. “I am pleased this recovery package will provide additional assistance, so families can receive the treatments they need and deserve.”

“For hospitals facing decreased revenues and tighter budgets, this economic recovery bill funding will help close the gap and relieve fiscal pressures,” said Levin. “I am hopeful this funding will help hospitals in Michigan that are treating rising numbers of uninsured and lower-income patients during these difficult economic times.”

States receive an annual allotment to make payments to eligible hospitals known as Disproportionate Share Hospitals (DSH) to account for higher costs associated with treating uninsured and low-income patients. This annual allotment is calculated by law and includes requirements to ensure that the DSH payments to hospitals are not higher than the actual costs incurred by the hospital to provide the uncompensated care. The Recovery Act increases the amount of allotments available to states from approximately $11.06 billion to $11.33 billion for 2009.

The Centers for Medicare & Medicaid Services (CMS) will notify states about the availability of the increased portion of allotments for hospitals. Not all states spend their full DSH allotments; so, before this new funding can be accessed, states must demonstrate they have used all of their existing fiscal year 2009 DSH allotments. States must request the additional funds from CMS as part of their quarterly Medicaid budget request and the funds will be distributed as separate Recovery Act DSH grants.