Hospitals to Save $5.7 Billion Under Affordable Care Act - The Minute

Hospitals to Save $5.7 Billion Under Affordable Care Act - The Minute

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Thursday, September 25, 2014 - 4:00pm


CONTENT: Multimedia with summary

The ever-changing revenue picture for hospitals just got some numbers to fill in at the bottom line: $4.2 billion. That’s how much the Department of Health and Human Services projects that hospitals in 26 states that have raised Medicaid eligibility under the Affordable Care Act will save because of the lower costs of uncompensated care. Hospitals in states that refused the Medicaid expansion under the ACA will also save, but not nearly as much, a projected $1.5 billion. Total savings: $5.7 billion.

Previously, financial filings from individual hospital operators and credit-rating firms had provided hints at large savings, but it wasn’t clear just how much they added up to. The projection is a significant reduction in the overall amount of uncompensated care delivered by U.S. hospitals, estimated to be $52 billion in 2012. If accurate, the savings will change how hospitals account for these costs—in many cases, large sums for uncompensated care are simply written off as bad debt. To compile the figures, HHS looked at results from five large investor-owned chains: Community Health Systems, HCA, Tenet Healthcare Corp, LifePoint Hospitals, and Universal Health Services, as well as surveys conducted by hospital associations in Arizona, Colorado, and Arkansas.

I’m John Howell for 3BL Media.

Video Source: Hospitals to Save $5.7 Billion Under Affordable Care Act