PwC Health Research Institute confirms that hospitals in Medicaid expansion states are faring vastly better

In a report issued this week, the PricewaterhouseCoopers LLP Health Research Institute concludes that the patchwork Medicaid expansion the courts allowed under the Affordable Care Act has created health system “haves and have nots.”

The report authors analyzed financial data from the nation’s largest for-profit publically traded health systems — HCA Holdings, LifePoint Hospitals, Tenet Healthcare, Community Health Systems and Universal Health Services — as well as information from several mid-sized hospitals, government reports, industry surveys and executive interviews. They found that in states that expanded Medicaid, the influx of newly insured patients helped reverse declines in admissions and a rise in uncompensated care. However, on the flip side, in non-expansion states, admissions continued to decline and self-pay, a high portion of which ends up being uncompensated care, remain a large percentage of patients. This could put hospitals and health systems in non-expansion states at a significant business disadvantage to those in expansion states, making it difficult for them to compete for physician and leadership talent, financing, and other resources with national demand.

In the report, Chris Tholen, vice president of financial policy at the Colorado Hospital Association, also noted that hospitals in non-expansion states furthermore might face a disadvantage because the self-pay patients often wait to seek care until their conditions are more advanced and costlier to treat. “Take away the finance for a second and think about the mission of hospitals, which is to improve the health of a population,” he said. “An insured community is a healthier community.”

The report is posted online here.