The Trump administration recently announced its intent to withhold $259 million from Minnesota’s Medicaid reimbursements due to fraud concerns. CMS Administrator Mehmet Oz said Medicaid funds in Minnesota were going to "bogus" centers for autistic children and a behavioral health organization that had bills showing doctors working 24 hours a day for more than 450 days.
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| Percentage of hospital revenue coming from low-income health insurance programs. (Map by Sarah Melotte, Daily Yonder, data from the Center for Healthcare Quality and Payment Reform, Click to enlarge) |
Rural hospitals are
disproportionately affected by these cuts. Melotte explains that rural hospitals
are more likely to operate with negative profit margins than urban hospitals, and
39 of Minnesota’s 98 rural hospitals have negative operating margins. This
means the rate of uncompensated care will increase even more in these rural
hospitals.
Some of these hospitals are able to stay open using
non-operating revenue, such as taxes or philanthropy, but this isn’t the case
for all of them, reports Melotte. More than 100 rural hospitals throughout the U.S. have
had to close in the last decade, causing rural residents to have to travel
farther to access the care that they need.
One nonprofit in Minnesota that houses people with
disabilities reported to Minnesota Public Radio that “any cuts to Medicaid funding
will directly result in reduced services.”
Medicaid now accounts for around 19% of discharges in
rural hospitals nationwide, Melotte writes. “In communities where hospitals
operate on thin margins, even small cuts in federal spending can destabilize
entire systems of care.”
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