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Member Research and Reports

Member Research and Reports

Michigan Researchers Find Medicaid Expansion Gives Hospitals Immediate Relief from Uninsured Care

Just six months after opening up health insurance to more low-income people, states saw a huge drop in the amount of care their hospitals provided to uninsured patients, and a rise in care for people with coverage, a new study finds.

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[Photo: Dr. Sayeh Nikpay]

The fast, sharp effect suggests one of the key parts of the Affordable Care Act works as intended, giving hospitals a chance to recoup more of the cost of care they provide instead of having to absorb it when a low-income patient cannot pay.

The study looked at hospital discharges in a sample of states that expanded Medicaid, using data from a new national source. In all, hospital stays by uninsured patients went down 50 percent, and stays by people with Medicaid went up 20 percent, between the end of 2013 and the middle of 2014.

But the same study also shows the flip side of the situation, in a sample of states that didn’t expand Medicaid after a Supreme Court decision made expansion optional.

There, hospitals continued to experience the same or even higher demand for care from people without insurance. The effect persisted even when the University of Michigan researcherstook into account other differences between the two types of states.

“In expansion states, we see exactly what we would expect to happen after Medicaid became available to more people,” says Dr. Sayeh Nikpay, lead author of the new study published in the January issue of Health Affairs. “Even in these early months, the shift from uninsured to Medicaid contrasts sharply with the steady demand for uninsured care in non-expansion states. This has implications for the financial status of hospitals.”

Data from hospital stays in a sampling of states shows the stark difference between what happened in states that expanded Medicaid (solid lines) and those that did not (dotted lines), in terms of insurance status of patients needing inpatient care.

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