Wednesday, March 01, 2017

Medicaid expansion kept hundreds of rural hospitals afloat; ACA repeal could put them at risk

Medicaid expansion brought a windfall to many rural hospitals, as millions of Americans gained coverage and were able to pay for care, but the looming threat of repealing the Patient Protection and Affordable Care Act puts "670 rural hospitals across the country at risk of shutting their doors," Jeff Lagasse reports for Healthcare Finance, citing findings from iVantage Health Analytics.

According to iVantage, which "examined rural hospital performance across a variety of measures," the expansion of Medicaid benefited rural hospitals the most, Lagasse writes. "Rural hospitals in expansion states, running on extremely tight margins, saw a significant improvement to their bottom lines, and provided a benefit to the estimated 62 million Americans living in rural areas, many of whom received health coverage under the ACA for the first time."

How does pulling the plug on ACA threaten rural hospitals? For starters, Lagasse notes, "many are not part of larger health systems, which gives them decreased leverage when dealing with insurance companies; they also don't have as much capital to invest in amenities such as facilities and electronic health records."

"There's a statistically significant impact on the rural median operating margins in states that expanded Medicaid," Michael Topchik, national leader of the Chartis Center for Rural Health and member of the iVantage leadership team, told Lagasse. Topchik implicitly touched on the politics of repealing and replacing the ACA: Many states President Trump carried, "like West Virginia, Iowa, Kentucky, Louisiana . . . saw a lot of people gain coverage either directly through Medicaid expansion or secondarily through the exchanges" for tax-subsidized insurance policies.

iVantage "estimated that that loss of Medicaid expansion would contribute to 137,000 fewer jobs in the broader community, with 99,000 of those jobs lost in the health-care sector," Lagasse writes. "The ACA used only federal funds from 2014 through 2016 to pay for the expanded benefits, and while that reduces to 90 percent by 2020, it's more than the 50- to 75-percent match that existed before ACA implementation" for traditional Medicaid. "Preliminary replacement plans from the GOP-led House would eliminate Medicaid expansion by 2020."

1 comment:

Paul Hays said...

Georgia has already officially lost 11 small rural hospitals with 15 threatened and over 50% of the rural hospitals losing money. USA Today reported that over 63 rural hospitals has gone out of business in SE States. Other source WABE.org fm 90.1 NPR affiliate a 100,000 watt station in metro Atlanta owned by Atlanta Public Schools.