New report: Medicaid expansion is having a big and positive impact on safety net hospitals and clinics

New report: Medicaid expansion is having a big and positive impact on safety net hospitals and clinics

Medicaid-Funding0915The 19 states, including North Carolina, that continue to decline federal funding to offer Medicaid coverage to more uninsured residents are missing out on more than just improvements to their uninsured and uncompensated care rates. In fact, the ability of providers in Medicaid expansion states to deliver care to their most vulnerable patients has notably improved.

Residents of Medicaid expansion states—both adults and children—are more likely to have insurance and thus more likely to have a usual source of care and less likely to have unmet health care needs or problems paying medical bills. Furthermore, Medicaid expansion has helped the financial bottom line for safety-net clinics and hospitals because more of their patients can afford to pay for their care.

But the benefits of Medicaid expansion go further, as described in a policy brief published by Georgetown University’s Center for Children and Families. According to interviews with health system leaders in both expansion and non-expansion states, drops in uncompensated care and decreasing uninsured rates are having a positive ripple effect on the health system in expansion states.

Medicaid expansion is bolstering the financial stability of safety-net health care providers. It reminds us of the aphorism, “No margin, no mission.” Our respondents report that moving from the red to the black allowed them to hire staff, open new facilities, and expand services for clients with the greatest health care needs. By contrast, those providing services in non-expansion states struggle to meet patient needs. They must spend their limited funds to maintain core services for those who would be eligible for Medicaid if expansion were enacted in their states. According to one clinic leader in a non-expansion state, “it is harder to balance the mission…. There is an unmet need and it is growing.”

The improved financial picture has allowed these providers to go beyond service expansions to make investments in improving the quality of care. One health center director described improved coordination of care with other providers across the community, while another noted a greater focus on population health. Three of the providers we interviewed highlighted improvements in their ability to deliver behavioral health services, including better integration of services for patients with both behavioral health and other health conditions. According to one provider, “Medicaid expansion has had a profound impact on our ability to deliver care — it is like night and day.”

Not every problem is solved by Medicaid expansion. Access to specialty care remains a challenge for those with limited resources. But providers in expansion states told us that they are finding more options. As one noted, “Medicaid expansion has opened the door to specialists being willing see our Medicaid patients.”

As a whole, the positive impact of Medicaid expansion has been felt beyond the walls of the health care facilities whose leaders we interviewed. Safety-net facilities in expansion states have used their new financial security to take steps to improve the way the health system works both in their facilities and in their broader communities. Furthermore, their ability to hire new staff and to expand facilities not only benefits the patients they care for but also offers a beneficial economic impact to their communities. The 19 states that have chosen not to expand Medicaid are missing out on opportunities to broaden access to care while also enhancing the quality of the health care safety net in their communities.

Read the full report or listen to the recording.

Adam Searing is a Senior Research Fellow at the Georgetown University Health Policy Institute’s Center for Children and Families.