WASHINGTON (AP) — The number of uninsured patients admitted to hospitals has dropped markedly this year, reducing charity care and bad debt cases, particularly in states that have expanded Medicaid coverage under the new federal health care law, a government report released Wednesday concluded.
The report from the Department of Health and Human Services said hospitals in states that have taken advantage of new Medicaid eligibility levels have seen uninsured admissions fall by about 30 percent. The report estimated that the cost of uncompensated hospital care will be $5.7 billion lower in 2014.
The announcement of the findings is part of the Obama administration's continuing effort to persuade states that have declined to expand their Medicaid coverage to reconsider their objections. So far, 27 states and the District of Columbia have agreed to provide Medicaid to people with income higher than poverty levels, as permitted under the health care law.
What's more, the report comes seven weeks before the start of a new round of open enrollment, a critical test for the health care law. Obama administration officials said both the Medicaid expansion and the law's requirement that individuals obtain insurance had contributed significantly to the decrease in the number of uninsured Americans.
The report's findings are not surprising because the expansion of Medicaid alone was bound to reduce the number of uninsured people. But Health and Human Services Secretary Sylvia Burwell said the data underscored the experience of governors and private sector health care providers.
"You hear the anecdotal evidence of the importance in the reduction of uncompensated care to hospital's bottom lines," she told reporters.
Other studies, however, also show that the rise in the newly insured under Medicaid has increased the number of patients seeking treatment in hospital emergency rooms, one of the most expensive medical settings.
Burwell said one of her priorities is making sure that people know how to use insurance coverage for both prevention and wellness.
"As we move to a space where we have delivery system reform and we have people kicking in in terms of knowledge of use, I think we're going to get to a place where we will see those numbers decline," she said.
Of the $5.7 billion in estimated lower uncompensated care costs, the Health and Human Services report said $4.2 billion of the reduction would be in 25 states and the District of Columbia, which expanded Medicaid at the beginning of this year. Two other states have since then agreed to expand their coverage for low income people, leaving 23 states without an expanded health care safety net.
The Affordable Care Act expanded Medicaid to cover many low-income adults with no children living at home. They were previously ineligible in nearly every state. HHS estimates that about 8 million people have been added to the rolls of the program, which is jointly run by the federal government and the states.
The federal government is paying the entire cost of the expansion through 2016, gradually phasing down to a 90 percent share thereafter. Another part of the law, which is available in every state, offers subsidized private health insurance to people who don't have a health plan on the job.