States that chose to expand their Medicaid services under the Affordable Care Act are seeing significant reductions in uninsured hospital visits.

A review of publicly traded hospitals’ earnings calls by The Washington Post shows that uninsured (self-pay) hospital visits dropped between 28 and 33 percent at some of the largest hospital systems in the country in states that took advantage of the federally-funded Medicaid expansion. At the same time, Medicaid admissions increased anywhere from 4 to 22 percent at those same facilities.

The story is less encouraging in the 24 states that refused Medicaid expansion. Non-expansion states saw upticks in both self-pay ER visits and uninsured admissions, and some actually had decreased Medicaid admissions. Hospitals have pushed for Medicaid expansion, arguing that even Medicaid’s lower reimbursement rates are better than what they (often do not) collect from uninsured patients.

Many states have also dragged their feet in preparing for the ACA’s broader implementation of presumptive eligibility, a system by which hospitals can preemptively enroll families with qualifying income in a Medicaid program to provide them care up-front. The state Medicaid agency then processes the complete application, putting many otherwise uninsured families on the path to coverage.

There are troubling financing implications for the uneven expansion of Medicaid around the country. The increase of self-pay patients in non-expansion states increases the amount of potentially uncollectible funds owed to those hospital systems and facilities, which also raises the risk to a healthcare factoring company.

Factors collect from insurance, Medicaid, and Medicare, but not from individual patients; therefore, more self-pay accounts reduce the number of valid invoices that a hospital can factor to offset the gap in federal reimbursements. If the above numbers continue their current trajectories, there is a very real possibility that healthcare factoring companies may tighten their requirements for working with clients in non-expansion states – or decline to work with them altogether.

We will continue to provide updates on Medicaid expansion and its impact on facilities in both expanded and non-expanded states.

PRN Funding offers healthcare factoring services to vendors providing a variety of healthcare services to hospitals and other healthcare facilities. Learn more about the different healthcare factoring options we provide and fill out our easy online application to begin.