Research Report The Financial Benefit to Hospitals from State Expansion of Medicaid
Stan Dorn, Matthew Buettgens, John Holahan, Caitlin Carroll
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State decisions to expand Medicaid have important implications for hospitals. There are a number of provisions in the Affordable Care Act that will reduce hospital payments - lower rates of Medicare reimbursement and cut backs in Medicare and Medicaid disproportionate share hospital payments. On the other hand, hospitals stand to gain considerably from the added insurance coverage because of the Medicaid expansion. Fewer uninsured will mean higher revenues to hospitals. However, some newly covered Medicaid patients will have formally been privately insured. For these patients, Medicaid will typically pay less than private insurance. On balance, we show that for each $1.0 in private revenue that the Medicaid expansion eliminates, hospitals Medicaid revenue increases by $2.59.

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Research Areas Health and health care
Tags Health insurance Federal health care reform Health care delivery and payment Medicaid and the Children’s Health Insurance Program  Hospitals and physicians Private insurance
Policy Centers Health Policy Center