Category Archives: Underinsured

The Treacherous Transition Awaiting Millions Losing Their Medicaid

Posted on by • Posted in ACA, Administrative Churn, Health Insurance Coverage Adequacy, Health Policy, Health System, Hospital, Hospital Industry, Medicaid, Medicaid Expansion, Medicaid Redeterminations, Uncompensated Care, Underinsured, Uninsured • Leave a comment
The Treacherous Transition Awaiting Millions Losing Their Medicaid

We dig into three research papers to make sense of what will happen to 15 million people set to lose their Medicaid over the next year.

Listen to the full episode below, read the transcript or scroll down for more information.

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https://embed.acast.com/tradeoffs/?brandColor=e65a4b

Researchers estimate 15 million people will lose their Medicaid starting April 1 when states begin removing people from the low-income health insurance program for the first time in three years.

In March 2020, Congress banned states from removing people from Medicaid during the pandemic in exchange for more federal funding for state Medicaid programs. Medicaid enrollment is usually tied to people’s incomes, and individuals normally have to regularly prove they still qualify in what’s known as a redetermination. (In the 39 states and Washington, D.C., that have expanded Medicaid, a family of four has to make less than $40,000 to qualify. In non-expansion states, the cutoff is even lower.)

With redeterminations paused, Medicaid enrollment nationwide has grown from 71 million in February 2020 to an estimated 95 million in March 2023. Research shows Medicaid coverage is associated with better access to care, more financial security, better health and lower mortality. During the pandemic, beneficiaries have been able to enjoy these benefits without worrying about confirming their eligibility.

In December, Congress voted to let states restart the process of clearing their rolls on April 1, what’s sometimes referred to as “unwinding.” Lawmakers are giving states 14 months to redetermine millions of people’s eligibility — an unprecedented task made even more difficult by serious staffing and experience shortages in many Medicaid offices.

“It’s going to be a big lift,” said Sayeh Nikpay, a health policy researcher at the University of Minnesota and Tradeoffs Senior Research Advisor. “States have never had to do this many redeterminations this quickly before, and there’s a lot of uncertainty about what will happen.”

We asked Nikpay to pick out a few relevant studies to help us understand what is happening and how states and employers could keep more people insured. Here are three she identified as particularly helpful.

Two types of people will lose coverage

The Office of the Assistant Secretary for Planning and Evaluation, which provides research for the U.S. Department of Health and Human Services, released a report in August 2022 that estimated 15 million people will lose Medicaid coverage as a result of the unwinding. (The estimate is similar to another analysis by the independent Urban Institute.)

ASPE breaks those 15 million people into two groups. In the first group are people who make too much money to qualify for Medicaid. ASPE estimates there are about 8 million people in that category, and they should be able to get insurance through work or the Obamacare exchanges.

In the second group are roughly 7 million people ASPE estimates are still eligible but will lose coverage because of what’s called “administrative churn.” This can happen if the Medicaid office can’t get in touch with someone to confirm their eligibility because they’ve moved or changed their phone number or if they’re unable to make an in-person appointment because of work or child care responsibilities. (The Urban Institute projects about 4 million people will be in this group.)

These two groups represent a key tension to the unwinding process: States want to shed people who make too much money, but officials also know eligible people often lose coverage during redeterminations, and that danger is heightened given the scale and speed of this process.

Making the switch from Medicaid to private insurance

This next paper looks at the first group: the roughly 8 million people expected to move from Medicaid to private coverage, and specifically the roughly 4 million who are expected to get coverage through the Obamacare exchanges. Adrianna McIntyre, an assistant professor of health policy at Harvard, wrote in JAMA Health Forum in October 2022 about the most effective ways to move people from Medicaid onto private Obamacare plans.

There’s limited data on this, but based on the few studies available, McIntyre found that only 3 to 5 percent of people who leave Medicaid end up getting an Obamacare plan. Many policymakers are relying on the Obamacare exchanges to provide a life preserver to millions of people losing Medicaid coverage, but the research cited by McIntyre shows getting people into these plans is not guaranteed and will take focused effort by states.

McIntyre’s review cites several randomized controlled trials where states tested different ways of increasing enrollment in Obamacare plans. These studies found simple reminders from the state – like physical letters, emails and phone calls help – boost sign-ups anywhere from 7 to 16 percent.

But what really seems to make a difference is reminders plus connecting people to someone who can get them signed up while they are on the phone. In one of those trials published in 2022, people in California who got a reminder email and a call connecting them to enrollment assistance were almost 50% more likely to sign up for a plan. Such extra effort is obviously costly, and it may not be a priority or financially feasible for some states.

McIntyre’s review did not include any research on what employers can do to help their workers transition from Medicaid to work-based coverage, but based on the studies McIntyre cited, Nikpay said she thinks it’s a good idea for employers to make sure people know Medicaid could be going away and provide as much help as possible in getting new coverage.

Making it easier to stay on Medicaid can have other benefits

The final study looks at the second group of people expected to lose Medicaid coverage: the 7 million people who may lose coverage due to administrative churn even though they are still eligible. 

Some states have tried to limit that churn, and researchers at the RAND Corporation evaluated New York’s effort. Starting in 2014, New York allowed people to stay on Medicaid without any redeterminations for 12 months once enrolled. 

In addition to keeping more people on Medicaid for longer, researchers found that after this policy was in place, hospital admissions and monthly costs per beneficiary went down. The researchers can’t say whether the continuous enrollment policy directly caused these improved outcomes, but the findings suggest that avoiding administrative churn can help people stay covered without ballooning costs.

“It seems reasonable to me,” Nikpay said of the findings, “that making it easier to stay on Medicaid, even outside of a global pandemic, could benefit people’s health given what we know about how Medicaid affects people.”

High-deductible and skinny health insurance plans drive medical debt

Posted on by • Posted in Health Insurance Coverage Adequacy, Health Insurance Industry, Medical Debt, Short Term Health Insurance, Skinny Health Plans, Underinsured, Uninsured • Leave a comment

https://www.aha.org/news/blog/2023-03-20-high-deductible-and-skinny-health-insurance-plans-drive-medical-debt

A recent Urban Institute report highlights the issue of medical debt but fails to examine two of the chief driving forces of this debt: inadequate enrollment in comprehensive health care coverage and high-deductible health plans that intentionally push more costs onto patients. It also fails to appreciate the looming crisis when the public health emergency ends and Medicaid enrollment could plummet.

As the extent of medical debt shows, both the government and the private market is failing too many patients, leaving too many either uninsured or with subpar plans that expose too many people to bills they cannot afford to pay. While hospital financial assistance is crucial to helping many individuals of limited means access care, it is no substitute for a solution that gets to the root causes of medical debt.

Affordable, comprehensive health care coverage is the most important protection against medical debt. While the U.S. health care system has achieved record rates of coverage, significant gaps remain and new threats are on the horizon. One of the gaps is the failure by some states to expand Medicaid, while the most imminent threat is the potential loss of Medicaid coverage for millions of people as the public health emergency ends. We must ensure that every individual has access to some form of comprehensive coverage.

In doing so, we must put an end to deceptively inadequate health plans. These include short-term limited duration health plans and health sharing ministries that often appeal to consumers because they are cheaper and often marketed to appear comprehensive. The reason they are cheaper is because when you read the fine print you discover they cover fewer benefits and include few-to-no consumer protections, like required coverage of pre-existing conditions and limits on out-of-pocket costs. Subscribers for these types of plans often find themselves responsible for their entire medical bill without any help from their health plan and can accumulate significant medical debt.

Many of the same concerns apply to high-deductible health plans. These plans are specifically designed to increase patients’ financial exposure through high cost-sharing – the amount the subscriber must pay out-of-pocket. Yet, many individuals enrolled in these plans find they can’t manage the gap between what their insurance pays and what they themselves owe as a result. It’s not a mystery why high-deductible health plans contribute to medical debt.

Hospitals and other providers do not determine how much insured patients owe for their care. Instead, that amount is set by the health plan. While every hospital has a financial assistance policy to help those most in need, they can only help so much and so many. And no matter how generous, hospital financial assistance will never be a substitute for a health plan that covers preventive and necessary care at an affordable price on the front and back end of coverage.

We must tackle the problem of medical debt, and we must do so at the root: ensuring all individuals are enrolled in comprehensive health care coverage and ending deceptive marketing of health plans and unaffordable cost-sharing.

Potential solutions include:

  • Restricting the sale of high-deductible health plans to only those individuals with the demonstrated means to afford the associated cost-sharing.
  • Prohibiting the sale of health sharing ministry products and short-term limited duration plans that go longer than 90 days.
  • Lowering the maximum out-of-pocket cost-sharing limits.
  • Eliminating the use of deductibles and co-insurance and rely solely on flat co-payments, which are easier for patients to anticipate.
  • Removing providers from the collection of cost-sharing altogether and require that health plans collect directly from their enrollees the cost-sharing payments they impose. This approach would eliminate the vast majority of patient bills from providers altogether.

Moreover, the AHA has been actively engaged in identifying and promoting best practices in patient billing for decades. The AHA updated our voluntary patient billing guidance in 2020. The guidelines include assisting patients who cannot pay for the care they receive and protecting patients from certain debt collection practices, such as garnishment of wages, liens, interest on debt, adverse credit reporting and lawsuits. Most hospitals provide free care for patients with the most limited means as defined by income below 200% of the federal poverty limit. In the event of an unpaid bill, the Internal Revenue Service has prescribed an extensive series of steps and wait times that most hospitals must adhere to before taking any collection actions, which is a last resort.

Hospitals’ doors are always open to anyone who needs care, regardless of ability to pay. In total, hospitals and health systems of all types provided in 2020 more than $42 billion in uncompensated care, or care for which they received no payment.

Hospitals and health systems will continue to work to advance solutions that make care more affordable and accessible for all patients. But health plans must do their part by providing adequate coverage that does not subject patients to unaffordable bills and medical debt.

Medicaid enrollees largely unaware of upcoming redeterminations, survey finds

Posted on by • Posted in Bad Debt Expense, Health Insurance Coverage Adequacy, Health Policy, Health System, Hospital, Hospital Industry, Medicaid, Medicaid Eligibility, Uncompensated Care, Underinsured, Uninsured • Leave a comment

https://www.healthcaredive.com/news/medicaid-redeterminations-restart-enrollees-unaware-Robert-Wood-Johnson/643158/

Dive Brief:

  • About 64% of adults in a Medicaid-enrolled family in December said they did not know they may lose coverage once pandemic-era policy ends and eligibility checks resume on April 1, according to a survey from the Robert Wood Johnson Foundation.
  • The percentage of respondents who said they heard nothing about upcoming Medicaid renewals rose from June, when 62% said they knew nothing about the changes, the survey found.
  • Awareness was low across the board regardless of geographic region or a state’s Medicaid expansion status, according to the survey.

Dive Insight:

The federal government barred states from resuming Medicaid eligibility checks amid widespread job losses and other challenges during the pandemic.

Once eligibility checks resume, as many as 18 million people are expected to lose coverage, according to the Robert Wood Johnson Foundation.

About 7 million of those people are expected to gain coverage through the individual markets or employer-sponsored plans, though 8 million will not and will likely become uninsured, according to a report from Moody’s Investor Services.

Awareness levels regarding looming redetermination checks remained low and varied only slightly regionally, the report found.

Similarly, above 60% of respondents reported unawareness of Medicaid redeterminations both in Medicaid expansion states and those that haven’t expanded Medicaid, “which suggests the need for widespread outreach and education efforts,” the report said.

“Reducing information gaps about the change is a critical first step,” the report said.

In non-expansion states, people will need help learning about navigating marketplace options, while in expansion states they’ll need information on how to stay enrolled, the report said.

The suspension of eligibility checks led Medicaid membership to rise substantially during the pandemic, growing from 70.7 million members in February 2020 to 90.9 million in September, according to the Moody’s Investor Services report.

The end of the policy is expected to deal a blow to payers that have touted recent enrollment growth while hospitals could see more self-pay patients and “higher bad debt” for facilities, the Moody’s report said.

White House announces COVID public health emergency will end in May

Posted on by • Posted in Health System, Hospital, Hospital Industry, Medicaid, Operating Expenses, Operating Margin, Public Health Emergency (PHE), Uncompensated Care, Underinsured, Uninsured • Leave a comment

https://mailchi.mp/a44243cd0759/the-weekly-gist-february-3-2023?e=d1e747d2d8

On the eve of a scheduled House vote on a bill that would immediately end the federal public health emergency (PHE), the Biden administration announced Monday that both the PHE and the COVID national emergency will end on May 11. With the Omnibus legislation passed at the end of December, Congress already decoupled several key provisions once tied to the PHE, including setting April 1st as the date on which states can resume Medicaid redeterminations, and extending key Medicare telehealth flexibilities.

However, once the PHE ends, various other provider flexibilities will expire: hospitals will no longer receive boosted Medicare payments for COVID admissions, and the cost of COVID tests, vaccines, and treatments will shift from the government to insurers and consumers. 

The Gist: While previous Congressional action addressed some pressing provider concerns, the end of the PHE will still bring big changes. 

The healthcare system will soon be responsible for covering, testing, and treating COVID like any other illness, even as the virus continues to take the lives of hundreds of Americans each day.

Many patients may soon find it difficult to access affordable COVID care, and many health systems will see an increase in uncompensated care, exacerbating current margin challenges. COVID remains an urgent public health concern in need of a coordinated strategy.

Uninsured rate fell for those historically lacking coverage

Posted on by • Posted in ACA, Health Insurance Coverage Adequacy, Medicaid, Medicaid Expansion, Public Health Emergency (PHE), Underinsured, Uninsured • Leave a comment

https://www.healthcaredive.com/news/uninsured-rate-fell-historically-lacking-coverage-hhs-repor/640488/

The national rate of uninsured people under the age of 65 fell from 11.1% in 2019 to 10.5% in 2021 as government policies aimed at increasing accessible coverage for those with lower incomes, according to an HHS report out last week.

The rate decline was highest among those who had incomes between 100% and 200% of the federal poverty level. Those in traditionally uncovered demographies, such as people who are Latino, American Indian/Alaska native and those who don’t speak English, saw larger gains in coverage.

The research comes as the Biden administration reported an 8% national uninsurance rate, a historic low, in the first quarter of last year for all Americans.

Half of the top 10 states for coverage gains expanded Medicaid under the Affordable Care Act between 2019 and 2021. The leading state, Maine, reached a 7.1% uninsured population in 2021, dropping from 10.2% in 2019. Officials shifted to a state-based exchange for the 2022 plan year.

“Many of the areas with the greatest coverage gains since 2019 had higher than average uninsured rates in 2021, suggesting progress in narrowing geographic disparities but still with substantial gaps remaining; the lack of Medicaid expansion in 11 states plays a key ongoing role in coverage disparities across states,” the report authors wrote.

The state with the largest increase in uninsured people was Alabama, which reached 12.5% in 2021 compared to 12.1% in 2019.

In addition to Medicaid expansion, other policies that helped those receive coverage include increased premium tax subsidies under the American Rescue Plan.

Also helping is the Medicaid continuous coverage provision, which has barred states from kicking people off rolls during the COVID-19 public health emergency.

That policy is set to end in April, however. Researchers have said that as many as 15 million to 18 million people could be affected.

States are taking some steps to help those eligible remain in the program. Most states plan to update enrollee mailing addresses and follow up with those people when action is recovered to maintain coverage, according to a recent Kaiser Family Foundation report.

Forty-one states said it will take up to 12 months to process renewals, KFF said.

Record-breaking 16.3M people signed up for ACA coverage

Posted on by • Posted in ACA, Health Insurance Coverage Adequacy, Medicaid, Medicaid Expansion, Public Health Emergency (PHE), Underinsured, Uninsured • Leave a comment

https://www.healthcaredive.com/news/record-breaking-people-signed-up-aca-coverage/641216/?mkt_tok=ODUwLVRBQS01MTEAAAGJjU731Jnz2OmQ49Mlkh7jVIfsWO9PQNGUgGD23jiZG76J5yFBjHCkGbM_HfYAWeZPujQSE5FV9Z068MsZ8c5kVs5X-6FfoAjcKiXxUnd6OBLk

The CMS announced Wednesday that a record-breaking 16.3 million people signed up for Affordable Care Act marketplace plans during the 2023 open enrollment season, a result of extended pandemic-era subsidies enacted by the American Rescue Plan.

Over 1.8 million more people enrolled in marketplace coverage compared to last year — a 13% increase, and the most amount of plan selections of any year since the launch of the ACA marketplace a decade ago, according to the CMS. The record-breaking enrollment numbers include 3.6 million first-time marketplace enrollees.

Enrollment comes after last year’s passage of the Inflation Reduction Act extended ACA subsidies into 2025, protecting millions of Americans from premium hikes and reflecting a broader push in policy from the Biden administration aimed at increasing healthcare insurance coverage. This month, the HHS announced that the national rate of uninsured people under the age of 65 fell from 11.1% in 2019 to 10.5% in 2021.

However, some coverage protections rely on the federal COVID-19 public health emergency status, which will expire without an extension in mid-April. Medicaid enrollment numbers are expected to drop at the end of the public health emergency, with as many as 18 million enrollees projected to lose Medicaid coverage, according to the Robert Wood Johnson Foundation.

In addition to a boost from subsidies, the CMS announced this month that it had quadrupled the number of navigators used to assist plan signups.

The Impact of the COVID-19 Public Health Emergency Expiration on All Types of Health Coverage

Posted on by • Posted in Children's Health Insurance Program (CHIP), Families First Coronavirus Response Act (FFCRA), Health Insurance Coverage Adequacy, Health Policy, Health System, Hospital, Hospital Industry, Medicaid, Public Health Emergency (PHE), Uncompensated Care, Underinsured, Uninsured • Leave a comment

https://www.rwjf.org/en/library/research/2022/12/the-impact-of-the-covid-19-public-health-emergency-expiration-on-all-types-of-health-coverage.html

The end of the COVID-19 Public Health Emergency will bring the largest health coverage changes since implementation of the Affordable Care Act.

The Issue

The Families First Coronavirus Response Act’s continuous coverage requirement prevents state Medicaid agencies from disenrolling people during the COVID-19 public health emergency. However, when the declaration of the emergency expires—currently scheduled for April 2023—states will resume normal eligibility determinations. This could result in millions losing access to affordable health coverage through Medicaid.

Key Findings

  • 18 million people could lose Medicaid coverage when the COVID-19 public health emergency (PHE) ends, according to a new analysis.
  • While many who are currently enrolled in Medicaid will transition to other coverage options, nearly 4 million people (3.8M) will become completely uninsured.
  • 19 states will see their uninsurance rates spike by more than 20 percent.
  • 3.2 million children will transition from Medicaid to separate Children’s Health Insurance Program (CHIP) health plans. 

Conclusion

State Medicaid officials and policymakers must continue to ensure that individuals currently enrolled in Medicaid are aware of the approaching end of the public health emergency, and that they have a plan to maintain or find new health coverage through their employer, the federal healthcare Marketplace, or Medicaid. 

Inflation supercharging cost-sharing challenges in healthcare

Posted on by • Posted in Affordability, Deferred Healthcare, Health Insurance Coverage Adequacy, Health System, High Deductible Health Plans, High Prices, Hospital, Hospital Industry, Inflation, Primary Care, Underinsured, Uninsured • Leave a comment

https://mailchi.mp/59374d8d7306/the-weekly-gist-january-13-2023?e=d1e747d2d8

After COVID fears and shutdowns led consumers to delay care early in the pandemic, persistently high inflation over the past year has further suppressed volumes.

As the graphic above illustrates, the average deductible for individual coverage has grown by over 140 percent since 2010, exposing consumers to an increasing portion of healthcare costs, and prompting economists to reevaluate the adage that healthcare is “recession-proof”. 

This year, that trend collided with an inflation spike that outpaced wage gains by two percent. Faced with diminished purchasing power, households are making budget tradeoffs which explicitly pit healthcare against other essential household needs. 

For some, this cost-cutting impulse even extends to preventative screenings—required to be covered without cost-sharing—when consumers’ financial concerns drive them to avoid healthcare altogether. 

While the latest inflation report suggests price increases are moderating, fears of a broader recession persist, making it critical for health systems and physicians to communicate with patients, encouraging them to continue to access preventive care, educating them about lower cost care options, and helping them prioritize treatment that should not be put off. 

Why some choose health care sharing ministries

Posted on by • Posted in ACA, Deceptive Advertising, Health Care Sharing Ministries (HCSMs), Health Insurance Coverage Adequacy, Medical Debt, Out of Pocket Expenses, Skinny Health Plans, Underinsured • Leave a comment
Why some choose health care sharing ministries

Open enrollment is upon us. While many are focused on which health insurance company has the best deal, health care sharing ministries (HCSMs) are quietly offering cheaper and less regulated alternatives to traditional coverage. Despite being an inadequate substitute, for some, they’re a welcome one.

What are HCSMs?

HCSMs are not health insurance; they are cost-sharing organizations. The idea is that members help each other directly cover medical costs. Members pay monthly contributions, similar to premiums, but can also make additional donations to cover specific bills from other members.

HCSMs are allowed to exclude pre-existing conditions from eligibility, exclude various health care services altogether, such as maternity care or contraception, and cap the lifetime financial assistance for which a member is eligible. They also do not guarantee claims will be reimbursed. (One review of HCSMs in Massachusetts found that only half of submitted claims were eligible for reimbursement.)

They are often, if not always, religiously affiliated. Members commit to a code of conduct, which may include abstaining from tobacco use and holding a traditional view of sex and marriage.

HCSMs and the Affordable Care Act

Because they are not insurance and because they are religiously affiliated, HCSMs are not regulated by the Affordable Care Act (ACA). They are not subject to minimal coverage guidelines and members are not subject to the individual mandate.

HCSMs are a notable exemption to the ACA. Supporters lobbied for the exemption based on a few reasons, including former President Obama’s promise that Americans could keep their coverage if they liked it. But the main motive was religious freedom. They argued that sharing health care costs was a “religious right and a privilege.” Congress agreed to the carveout to minimize religious opposition, and advocates lauded the decision as “Obamacare’s Silver Lining.”

The appeal of HCSMs

Some see HCSMs as a viable alternative to traditional health insurance and research suggests there may be a few reasons why.

Perhaps the most significant reason is freedom: freedom of religious expression and freedom from government oversight. The Bible encourages Christians to “bear one another’s burdens,” and HCSM members see their approach to health care costs as a fulfillment of that command. Additionally, many religious individuals oppose abortion and other medical services. As such, they may see HCSMs as a way to pay for their own health care needs without funding religiously prohibited services even indirectly.

HCSMs promote a sense of freedom beyond religion, including provider choice and less government interference. For example, members essentially pay out of pocket for health care, getting reimbursed later, so they can choose any provider that accepts self-paying patients. HCSMs also allow members to bypass “the system,” staying out of the carousel that is the heavily regulated health insurance industry.

A more tangible reason why some prefer HCSMs to traditional health insurance is thrift. Monthly contributions are typically less than monthly insurance premiums. This makes sense; HCSMs are set up to cover health care expenses after they’re accrued so upfront costs can be lower. Plus, the list of reimbursable services is often limited in exchange for even lower costs.

For healthy individuals, especially those who don’t use much health care, this kind of “low cost up front” arrangement can be enticing. But, if a member has an emergency or an extended hospital stay, or develops a chronic condition, they may be stuck with significant medical bills. Monthly contributions can also increase due to changes in health status, even common ones like weight gain.

While freedom and thrift are conscious reasons to prefer HCSMs, others may choose them due to inadequate health insurance literacy. Individuals less familiar with terms like coinsurance and deductibles may have difficulty choosing from a set of ACA-compliant health insurance plans. This difficulty likely extends to evaluating the relative costs and benefits of HCSMs.

Challenges differentiating between insurance and HCSMs may also increase when small businesses list HCSMs as a potential source of coverage for health care costs. Deceptive advertising by HCSMs and insurance brokers adds further confusion.

While HCSMs are an unregulated, risky alternative to traditional insurance coverage, some find the freedom and cost savings they provide attractive. Others don’t know of a better option and join an HCSM without understanding the potential consequences. Given that inadequate insurance coverage is associated with greater medical debt and delays in seeking necessary care, it’s important that consumers have clear, accurate information to facilitate coverage decisions.

Some red state hospitals pitch Medicaid expansion to solve rural health woes

Posted on by • Posted in ACA, Health Insurance Coverage Adequacy, Health Policy, Medicaid, Medicaid Expansion, Uncompensated Care, Underinsured, Uninsured • Leave a comment

https://www.axios.com/2022/12/08/red-state-hospitals-medicaid-expansion-rural-health-woes

Hospitals in some non-Medicaid expansion states are pitching expansion as a way to help solve the rural health crisis. But the industry is hardly speaking with one voice.

Driving the news: Facilities with fewer commercially insured patients that treat a large number of uninsured people see expansion as a potential lifeline in tough economic times.

Yes, but: Republican lawmakers in the holdout states continue to oppose enlarging their Medicaid rolls, citing higher state costs of covering a bigger population.

  • And hospital associations in North Carolina and Florida have opposed expansion plans, either out of concern about alienating key lawmakers or because the plans could bring other changes that disrupt dollars flowing to their members.

State of play: South Dakota voters approved a Medicaid expansion ballot measure this fall, leaving 11 non-expansion states.

  • Democratic governors in North Carolina and Kansas think they may be wearing down Republican opposition, Politico reports, but still face uphill battles when the new legislative sessions begin.

Zoom in: Medicaid expansion can bring dollars into a state’s health care system, even if the program pays only a fraction of the actual cost of care.

  • Numerous studies show that Medicaid expansion can have a positive financial impact on hospitals’ operating and profit margins, particularly smaller rural facilities, Robin Rudowitz, vice president at the Kaiser Family Foundation, told Axios.
  • The program could provide a reprieve for hospitals that were kept afloat in part by federal pandemic aid that’s now drying up.
  • “We have hospitals with 12 days cash on hand. We’ve lost a nursing home this year. We have seen decreased services. We’ve lost OB services in a few places, and we’ve seen over the years the decrease in mental health,” Wyoming Hospital Association vice president Josh Hannes told state lawmakers last month, per Politico.
  • Expanding Medicaid in other states has also led to a significant decline in uncompensated care costs, as well as improved states’ health outcomes, including overall mortality.

Yes, but: Medicaid expansion is not necessarily a silver bullet that will rescue every struggling facility.

  • Some state hospital associations are seeking other types of relief, from cuts in hospital bed taxes or higher reimbursements for existing Medicaid beneficiaries.

Of note: Rural, small hospitals have the most to gain from Medicaid expansion, because they serve a smaller patient populations with a larger pool of uninsured people.

  • Congress sweetened the deal for non-expansion states in the American Rescue Plan Act, with a 5% increase in the federal Medicaid Assistance Percentage for the state’s current Medicaid recipients, which lasts for two years.
  • In Texas, whose uninsured rate is the highest in the nation, hospital leaders think Medicaid expansion could help cover many in the working class whose jobs do not offer health plans.
  • “If you could get those folks coverage at a Medicaid rate it would obviously help the financial situations of (rural) hospitals, and if you could get them to a medical home you could deal with more acute medical conditions going forward,” John Hawkins, president of the Texas Hospital Association, told reporters last week.

The bottom line: While rural hospitals all over are facing headwinds, those in non-expansion states are bearing the brunt of the pain. And while there is a potential lever for those states, it doesn’t appear likely their elected officials are willing to pull it.