Today’s Wall Street Journal reports that while hospitals are seeing reduced bad debt due to a decrease in the uninsured, operating margins are still comparable to those of non-expansion states:
In expansion states, hospitals’ unpaid bills fell 13% on average last year compared with 2013, the report found. But, their 2014 operating margins didn’t increase any more than hospitals in the 22 states that have sat out the expansion, the report shows.
In Illinois, where Medicaid rolls grew by about 500,000 after the law’s key provisions took effect, one hospital found the changes didn’t fuel any big financial improvement.
“We did see a significant decrease in” unpaid bills, said Michael Kasser, chief financial officer of Southern Illinois Healthcare, which runs three hospitals southeast of St. Louis. “The bad news is, we saw such a huge increase in Medicaid,” he said, noting that the program pays only about half the hospital’s costs, on average.
He said the hospitals saved about $9 million in unpaid bills, but incurred around $28 million in costs for Medicaid patients, only about half of which was reimbursed by the state-run program. The result: Losses of around $5 million, despite expansion. Mr. Kasser says he believes many of those Medicaid patients had put off care—perhaps for years—when they lacked coverage. “We saw big cases, very sick people,” he said.
Get the full scoop here.
