- Despite the Affordable Care Act taking hold in recent years, the average amount of uncompensated care reported by hospitals rose to $12.8 million last year, up nearly $1.7 million from 2015, according to a new survey from Definitive Healthcare.
- Hospitals in the Southeast, where the expansion of Medicaid eligibility has mostly been rejected, saw the greatest growth in uncompensated care between 2015 and 2018.
- Smaller hospitals were hit particularly hard, with unreimbursed costs rising most among those with 25 beds or less, averaging an 8.5% annual increase between 2017 and 2018. However, hospitals with more than 250 beds had much higher total uncompensated care costs, averaging $39.7 million last year. Definitive surveyed 3,855 U.S. hospitals between 2015 and 2018.
Uncompensated care is always something hospital managers keep an eye on. It can be a sign of the economic vitality of the communities they serve, but also reflective of the healthcare policies of the state and region in which they reside. The survey by Definitive Healthcare provides a snapshot of both, noting that the uninsured rate in the U.S. last year ranged from 9% to 13.5%.
Medicaid expansion was supposed to fill in a gap left by the phasing out of the disproportionate share hospital program. Although $4 billion in DSH cuts have been put off at least a month due to the current spending resolution passed by Congress, the full elimination of DSH is likely to push up uncompensated care further. And should a federal appeals court or the U.S. Supreme Court find the ACA unconstitutional, it could push uncompensated care costs up even further.
That would be especially devastating for rural and smaller hospitals In April, a report from America's Essential Hospitals concluded that safety net hospitals were being pushed to the breaking point by uncompensated care costs.
Based on the Definitive data, hospitals in the Southeast saw the biggest percentage rise of unreimbursed care, rising 6% between 2015 and 2018. The Southeast has been particularly skeptical of the ACA, and many states in the region, including Tennessee, Georgia and the Carolinas, have declined to expand Medicaid eligibility.
In the Midwest, where there are also several holdout states, uncompensated care costs rose by 5.4% during that same period. By contrast in the West, where most states have expanded Medicaid eligibility under the ACA, uncompensated care costs rose 2.7% between 2015 and 2018. Hospitals in the Northeast have the largest uncompensated care burden, averaging $16.3 million last year. The Southeast was in second place, with an average burden of $14.7 million.
Two of the hospitals with among the biggest uncompensated care cost burdens in 2017 were in the South: John Peter Smith Hospital in Forth Worth, Texas, with $309 million and Methodist University Hospital in Memphis, Tennessee, with $225 million. Yale New Haven Hospital in Connecticut topped the list at $411 million.