Tag: Medicaid expansion

Apr 23
2019

eConsult Platform Use In Community Primary Care Settings Reduces Uncompensated Care Provided By Hospitals

By Chris Jaeger, head of ACO and health system strategy, AristaMD.

Rural hospitals are facing severe challenges in maintaining operating margin, with uncompensated care being a major factor. Telehealth eConsult platform use in local primary care settings to improve “right time, right place, right provider care” have been shown to decrease the number of patients receiving avoidable and unnecessary care within the hospital setting, thus supporting hospital’s ability to mitigate uncompensated care.

Uncompensated care is an overall measure of hospital care provided for which payment was not received from the patient or payer group. It equates to the sum of a hospital’s bad debt — the financial assistance it provides. Financial assistance includes care for which hospitals never expected to be reimbursed and care provided at a reduced cost for those in need. A hospital incurs bad debt when it cannot obtain re-imbursement for care provided; this happens when patients are unable to pay their bills, but do not apply for financial assistance, or are unwilling to pay their bills.

Hospitals, both nonprofit and for-profit, provide uncompensated care for individuals who are uninsured and under insured.

Though there has been a noted decline in uncompensated care since the 2014 passage of the Affordable Care Act and Medicaid expansion, this has not carried over to states not part of the expansion. States that expanded Medicaid to low-income adults under the ACA recognized a 47 percent decrease in uncompensated care costs, on average, compared to an 11 percent decrease in states that did not expand Medicaid.

(Coverage map as of Feb 2019)

Uncompensated care and dropping revenue margins are causing hospitals, especially in rural areas, to close. “While Medicaid expansion has improved all hospitals’ operating margins and total margins, the effect was particularly pronounced in rural areas,” noted a report from the Center on Budget and Policy Priorities. A recent study by the North Carolina Rural Health Research Program (NC-RHRP) at the University of North Carolina Cecil G. Sheps Center for Health Services Research (UNC-CH) showed that since 2010, 89 rural hospitals in 26 states have closed.

Much of this uncompensated care could be prevented through primary care intervention. A report, released by Premier, found that six common chronic conditions accounted for 60 percent of 24 million Emergency Department (ED) visits in 2017; out of that 60 percent, approximately one third of the visits (4.3 million) were likely preventable and could be treated in a less expensive outpatient setting.

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Jul 14
2015

Continual Rise of Medicaid: Two Paths to Reforming Healthcare Delivery

Ken Perez
Ken Perez

Guest post by Ken Perez, vice president of healthcare policy, Omnicell.

When one thinks of the areas targeted for healthcare delivery reform by the Patient Protection and Affordable Care Act (PPACA), Medicare, the largest area for healthcare spending by the federal government, obviously comes to mind. Notably, there are more than 400 Medicare accountable care organizations, and that figure is projected to rise in the coming years.

However, Medicaid is another significant and growing area of healthcare spending that could benefit from reform.

According to the Centers for Medicare and Medicaid Services (CMS), as of February 2015, 70.5 million people—more than one in every five Americans and 25 percent more than the number of Medicare beneficiaries—were enrolled in Medicaid or the Children’s Health Insurance Program, which represents an increase of almost 40 percent from the number enrolled at the end of 2009.

In 2013, the federal government and states together spent $438 billion on Medicaid, with $250 billion (57 percent) covered by the federal government. With 28 states and the District of Columbia expanding Medicaid coverage, in 2015 the federal government will spend $343 billion on Medicaid, an amount equal to 9 percent of total federal outlays and two-thirds of Medicare expenditures. Taking into account funding by the states, well over half a trillion dollars will be spent in total on Medicaid in 2015.

Moreover, spending on Medicaid is projected to eclipse the growth of the U.S. economy over the course of the next decade. The Congressional Budget Office projects the federal government’s spending on Medicaid will reach $576 billion in 2025, a compound annual growth rate (CAGR) of 5.3 percent over 2015 to 2025. That compares with projected a 4.3 percent CAGR for U.S. gross domestic product for the same period.

Although the coverage or access-to-care issue has been partially addressed via Medicaid expansion—with much more work to be done—how to provide high-quality care in a cost-effective manner through Medicaid constitutes the next challenge.

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