Advocates for Evidence-Based Health Policy Speakers
Obamacare’s Impact on the Safety Net
Safety-net hospitals (SNHs) are a legacy of America’s failure to ensure universal health care. Though EMTALA requires all hospitals to assess and stabilize patients regardless of ability to pay, SNHs provide a vital function by going beyond that minimum standard and providing more comprehensive care to the uninsured.
SNHs frequently serve low-income neighborhoods, improving access to care. Providing uncompensated care, however, may take a toll on the financial stability of SNHs and leave them vulnerable to shifts in the health policy landscape. For instance, the Affordable Care Act (ACA) decreases Disproportionate Share Hospital (DSH) payments provided to help defray uncompensated care costs, since the law was designed to shrink the uninsured population.
This study focused on how the ACA coverage expansion affected the inpatient payer mix at SNHs and non-SNHs. The number of uninsured patients dropped rapidly, with SNHs cutting their uninsured population by more than half (55.1%), though that was not significantly different than the decrease of 46.7% at non-SNHs once other factors were controlled. Medicaid patients increased for both types of hospitals, but the relative increase at non-SNHs was 27.1% vs. only 16.0% at SNHs. Visits by privately insured patients were fewer than what would have been predicted for both kinds of hospitals, with SNHs being farther below the historical trend.
To explain the unintuitive result of Medicaid stays increasing more at non-SNHs, the authors propose two possibilities. One option is that upon gaining Medicaid, previously uninsured patients elected to visit non-SNHs instead of SNHs. However, this is likely not the only cause as the total number of patients at non-SNHs did not significantly increase compared to SNHs. It may also be that private insurance, which is more common at non-SNHs, is getting crowded out due to the expansion in Medicaid, which is consistent with the number of privately insured visits being lower than expected.
For policymakers, this study draws attention to the implications of expanding eligibility for public insurance given its often lower reimbursement. Universal coverage for all Americans will likely require further expansion of public insurance, but along the way we must pay attention to the fiscal health of hospitals, if crowd out of private insurance becomes overly prevalent.
Abstract
OBJECTIVE: To examine the impact of the Affordable Care Act’s coverage expansion on safety-net hospitals (SNHs).
STUDY SETTING: Nine Medicaid expansion states.
STUDY DESIGN: Differences-in-differences (DID) models compare payer-specific pre-post changes in inpatient stays of adults aged 19-64 years at SNHs and non-SNHs.
DATA COLLECTION METHODS: 2013-2014 Healthcare Cost and Utilization Project State Inpatient Databases.
PRINCIPAL FINDINGS: On average per quarter postexpansion, SNHs and non-SNHs experienced similar relative decreases in uninsured stays (DID = -2.2 percent, p = .916). Non-SNHs experienced a greater percentage increase in Medicaid stays than did SNHs (DID = 13.8 percent, p = .041). For SNHs, the average decrease in uninsured stays (-146) was similar to the increase in Medicaid stays (153); privately insured stays were stable. For non-SNHs, the decrease in uninsured (-63) plus privately insured (-33) stays was similar to the increase in Medicaid stays (105). SNHs and non-SNHs experienced a similar absolute increase in Medicaid, uninsured, and privately insured stays combined (DID = -16, p = .162).
CONCLUSIONS: Postexpansion, non-SNHs experienced a greater percentage increase in Medicaid stays than did SNHs, which may reflect patients choosing non-SNHs over SNHs or a crowd-out of private insurance. More research is needed to understand these trends.
PMID: 29355927
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