Thursday marks the 13th anniversary of the signing of the Affordable Care Act– perhaps the most consequential healthcare legislation since LBJ’s passage of the Medicare Act in 1965. Except in healthcare circles, it will probably go unnoticed.
World events in the Ukraine and China President Xi Jinping’s visit to Russia will grab more media attention. At home, the ripple effects of Silicon Valley Bank’s bankruptcy and the stability of the banking system will get coverage and former President Trump’s arrest tomorrow will produce juicy soundbites from partisans and commentators. Thus, the birthday of Affordable Care Act, will get scant attention.
That’s regrettable: it offers an important context for navigating the future of the U.S. health system. Having served as an independent facilitator between the White House and private sector interests in 2009-2010, I recall vividly the events leading to its passage and the Supreme Court challenge that affirmed it:
- The costs and affordability of healthcare and growing concern about the swelling ranks of uninsured were the issues driving its origin. Both political parties and every major trade group agreed on the issues; solving them not so easy.
- Effective messaging from special interests about the ACA increased awareness of the law and calcified attitudes for or against. Misinformation/disinformation about the “Patient Protection and Affordable Care Act” morphed to a national referendum on insurance coverage and the cost-effectiveness of the ACA’s solution (Medicaid expansion, subsidies and insurance marketplaces). ‘Death panels. government run healthcare and Obamacare’ labels became targets for critics: spending by special interests opposed to the law dwarfed support by 7 to 1. Differences intensified: Emotions ran high. I experienced it firsthand. While maintaining independence and concerns about the law, I received death threats nonetheless. Like religion, the ACA was off-limits to meaningful discussion (especially among the majority who hadn’t read it).
- And after Scott Brown’s election to the vacant Massachusetts seat held by Ted Kennedy in January, 2010, the administration shifted its support to a more-moderate Senate Finance Committee version of the law that did not include a public option or malpractice reforms in the House version. Late-night lobbying by White House operatives resulted in a House vote in favor of the Senate version with promises ‘it’s only the start’. Through amendments, executive orders, administrative actions and appropriations, it would evolve with the support of the Obama team. It passed along party lines with the CBO offering an optimistic view it would slow health cost escalation by reducing administrative waste, implementation of comparative effectiveness research to align evidence with care, increased insurance coverage, changing incentives for hospitals and physicians and more.
The Affordable Care Act dominated media coverage from August 2009 to March 2010. In the 2010 mid-term election, it was the issue that catapulted Republicans to net gains of 7 in the Senate, 63 in the House and 6 in Governor’s offices. And since, Republicans in Congress have introduced “Repeal and Replace” legislation more than 60 times, failing each time.
Today, public opinion about the ACA has shifted modestly: from 46% FOR and 40% against in 2010 to 55% FOR and 42% against now (KFF). The national uninsured rate has dropped from 15.5% to 8.6% and Medicaid has been expanded in 39 states and DC. Lower costs, increased affordability and quality improvements owing to the ACA have had limited success.
Key elements of the ACA have not lived up to expectations i.e. the Patient Centered Outcome Research Institute, the National Quality Strategy, Title V National Healthcare Workforce Task Force, CMMI’s alternative payment models and achievement of Level 3 interoperability goals vis a vis ONCHIT, CHIME et al. So, as the 2024 political season starts, the ACA will get modest attention by aspirants for federal office because it addressed big problems with blunt instruments. Most recognize it needs to be modernized based on trends and issues relevant to healthcare in 2030 and beyond. Trends like…
- Self-diagnostics and treatment by consumers (enabled by ChatGPT et al).
- Data-driven clinical decision-making.
- Integration of non-allopathic methodologies.
- The science of wellbeing.
- Complete price, cost and error transparency.
- Employer and individual insurance coverage optimization.
- And others.
Issues like….
- The role and social responsibility of private equity in ownership and operation of services in healthcare delivery and financing.
- The regulatory framework for local hospitals vs. Regional/nation health systems, and between investor-owned and not-for-profit sponsorship.
- The role and resources for guided self-care management and virtual-care.
- Innovations in care delivery services to vulnerable populations using technologies and enhanced workforce models.
- Modernization of regulatory environments and rules of competition for fully integrated health systems, prescription drug manufacturers, health insurers, over-the counter therapies, food as medicine, physician ownership of hospitals, data ownership, tech infomediaries that facilitate clinical decision-making, self-care, professional liability and licensing and many others.
- Integration of public health and local health systems.
- The allocation of capital to the highest and best uses in the health system.
- The sustainability of Medicare and role of Medicare Advantage.
- The regulatory framework for disruptors”.
- And many others.
These trends are not-easily monitored nor are the issues clear and actionable. Most are inadequately addressed or completely missed in the ACA.
Complicating matters, the political environment today is more complicated than in 2010 when the ACA became law. The economic environment is more challenging: the pandemic, inflation and economic downturn have taken their toll. Intramural tensions in key sectors have spiked as each fights for control and autonomy i.e. primary care vs. specialty medicine, investor-owned vs. not-for-profit hospitals, retail medicine & virtual vs. office-based services, carve-outs, direct contracting et al . Consolidation has widened capabilities and resources distancing big organizations from others. Today’s media attention to healthcare is more sophisticated. Employers are more frustrated. And the public’s confidence in the health system is at an all-time low.
“ACA 2.0” is necessary to the system’s future but unlikely unless spearheaded by community and business leaders left out of the 1.0 design process. The trends and issues are new and complicated, requiring urgent forward thinking.
Paul
P.S. One of the more intriguing issues “inside baseball” is national media coverage about not-for-profit hospital systems. Providence, Ascension, Bon Secours and others have been featured in unflattering articles spiced by investigative reporting based on insider interviews and publicly accessible data re: profits, patient collection policies, executive compensation, community benefits, staffing levels, worker morale and more. The latest puzzle piece from Kaiser Family Foundation is focused on the comparative value of NFP hospital tax avoidance vs. fund use otherwise. (See Hospital Section below). This issue is relevant to every hospital, especially NFPs!
Resources
KFF Health Tracking Polls www.kff.org
US Census Bureau www.census.gov
Healthcare.Gov https://www.healthcare.gov/glossary/affordable-care-act
Quotable
Re: State of Play for Hospitals: “Healthcare is such a mess…After building in recent years, pushback against cost shifting (by commercial payers) seems to be moving toward a boiling point. Employers and their employees, who share the cost of commercial insurance and bear the brunt of cost shifting, are basically saying enough is enough and beginning to rebel…There is absolutely no question that American healthcare is too expensive and the primary focus has to be to reduce the cost of American healthcare. As part of this, hospitals and health systems nationally need to focus more on cost reduction than they have to this point”
John Goodnow, President and CEO, Benefis Health System, Great Falls MT April 2023 CEO Report Note: Benefis has operated at break even on Medicare rates since 2012 which represents 50% of its business vs. 27% Medicaid and 23% commercial.
Re: not-for-profit tax exemptions: “The estimated value of tax exemption for nonprofit hospitals increased from about $20 billion in 2011 to about $28 billion in 2020. The rising value of tax exemption means that federal, state, and local governments have been forgoing increasing amounts of revenue over time to provide tax benefits to nonprofit hospitals, crowding out other uses of those funds. This has raised questions about whether nonprofit facilities provide sufficient benefit to their communities to justify this tax benefit.”
Godwin et al The Estimated Value of Tax Exemption for Nonprofit Hospitals Was Nearly $28 Billion in 2020 KFF March 14, 2023 www.kff.org/health-costs/issue-brief/the-estimated-value-of-tax-exemption-for-nonprofit-hospitals-was-nearly-28-billion-in-2020
Re: SVB and banking system: “Banking is a confidence trick. Financial history is littered with runs, for the straightforward reason that no bank can survive if enough depositors want to be repaid at the same time. The trick, therefore, is to ensure that customers never have cause to whisk away their cash. It is one that bosses at Silicon Valley Bank (SVB), formerly America’s 16th-largest lender, failed to perform at a crucial moment.
The fall of SVB, a 40-year-old bank set up to cater to the Bay Area tech scene, took less than 40 hours. On March 8th the lender said it would issue more than $2bn of equity capital, in part to cover bond losses. This prompted scrutiny of its balance-sheet, which revealed around half its assets were long-dated bonds, and many were underwater. In response, deposits worth $42bn were withdrawn, a quarter of the bank’s total. At noon on March 10th regulators declared that SVB had failed.
The result of all this is that the banking system is far more fragile than it was perceived to be—by regulators, investors and probably bankers themselves—before the past week.”
How deep is the rot in America’s banking industry? The Economist March 16, 2023 www.economist.com/finance-and-economics/2023/03/16/how-deep-is-the-rot-in-americas-banking-industry?
Re: SVB bankruptcy: “The bankruptcy filing by SVB’s parent company concludes the first chapter of the failed bank’s collapse…But even as the dust settles, ominous concerns and unknowns remain about where we go from here…Eventually, we will see a new version of SVB emerge—albeit under the auspices of new management that will likely have different priorities, and perhaps different values, than its predecessor. And the consequences will be far-reaching for the venture industry.
It isn’t a foregone conclusion that SVB Financial, the bank’s holding company, will itself find a new owner. Apollo Global Management, Ares, Blackstone, The Carlyle Group and KKR have all reportedly started due diligence on SVB’s $74 billion loan book. Given the largely unprecedented nature of the deal, it is hard to say how PE investors would compare with traditional banks as custodians of SVB’s main business.
To a journalist who started his career among the ruins of the world’s last economic cataclysm, the finger-pointing and promises of lessons learned look all too familiar. And as with the previous crisis, the true cost of failure will be measured not just in dollars, but also in trust.
The Weekend Pitch Pitchbook March 17, 2023 www. Pitchbook.com
Re: SVB fallout: “In its Q4 earnings, SVB noted that it was a banker for 50% of the tech and life sciences startups in the US. Maybe that was an indicator of the problems ahead everyone missed. As the venture market goes, so goes Silicon Valley Bank.
The venture industry was already facing a slowdown; deal value fell roughly 60% from Q4 2021 through Q4 of last year. This quarter isn’t looking much stronger, but at least depositor guarantees are helping startups continue normal operations—for the time being.
Note: Eleven of the nation’s largest banks announced Thursday that they would deposit a total of $30 billion into First Republic Bank, as Wall Street and U.S. officials staged an emergency intervention aimed at quelling tremors in the financial sector. Bank of America, Citigroup, JPMorgan Chase and Wells Fargo announced infusions of $5 billion each for First Republic, while Goldman Sachs and Morgan Stanley will each deposit $2.5 billion.
Pitchbook SVB was an integral piece of VC—its failure will have a large impact March 18, 2023 www.pitchbook.com
Re: hospital facility fees: “When Sandeep Swami received a $1,339 bill for a quick and uneventful emergency room visit for his 11-year-old daughter, he pushed back.
The charge was a “facility fee” for the hospital, though the treatment entailed only a six- to seven-minute consultation with a doctor. Because Swami had a high-deductible health plan and had not yet met his deductible for the year, he was on the hook for the entire amount.
Swami’s attempt to dispute the charge led him to battle the hospital, then his insurer, a bill-mediation service provided by his employer, and finally the debt collector. He didn’t win, but learned valuable lessons about advocating for hospital discounts. “
Wrestling With a Giant: How to Dispute a Hospital Bill Season 9, Episode 3 March 13, 2023 https://khn.org/news/podcast/wrestling-with-a-giant-how-to-dispute-a-hospital-bill
Re: Hospital rankings: “It’s time for US hospitals to follow the example of medical and law schools by withdrawing from the US News rankings…Understandably, with such a longstanding reputation and a methodology report more than 150 pages long, hospital consumers view the US News rankings as an impartial observer working in their best interests.
While on the surface, the ranking methodology comes across as thoughtful and rigorous, a deeper review exploring what US News values within its specialty rankings can serve as a window to who it values. This is especially important as increasing light is being shed on inequitable care provided to Black, Indigenous, and People of Color (BIPOC) communities in US hospitals…
If, like universities, hospitals divorce themselves from ratings, we can refocus on the mission of treating our patients and communities equitably, and not being unduly influenced by flawed US News incentives.”
Madeline Wozniak Chinenyenwa Mpamaugo It’s Time For US Hospitals To Withdraw From The US News And World Report Rankings Health Affairs March 17, 2023 www.healthaffairs.org/content/forefront/s-time-us-hospitals-withdraw-us-news-and-world-report-rankings
Re: FDA Commissioner on role health insurers could play in drug research: “I looked at the profits, by the way, on the internet before coming over, and there’s a lot of money being made in this business. And it would seem like we ought to all be working together to develop the evidence so we spend the money on the things that work and we don’t spend the money on the things that don’t work… I’d really urge you to get beyond being a passive recipient of research and figure out what policies can you institute that actually make it easier to generate the evidence that we all need,” … I am very concerned that there is data sharing, information sharing, going on with companies, totally outside of sunshine, where algorithms are developed and dictate things like what’s paid for, who gets into which insurance plans, what’s on the formulary…No sunshine, and the methods are often methods that we would never accept at the FDA.”
John Wilkerson “Califf criticizes insurers for doing too little on drug research” STAT March 16, 2023 https://www.statnews.com/2023/03/16/califf-insurers-fda/
Re: social determinants of health: “Health care systems, health insurers, and the health care sector at large increasingly express interest in addressing patients’ HRSN (health-related social needs) and even in modifying SDOH to promote healthier populations.
Although this emphasis is both welcome and an important change in health care’s focus over the last decade, implementing programs that actually improve health has been challenging. Lack of understanding of what interventions really work, entrenched interests that benefit from health-harming aspects of the status quo, and the need to establish new mechanisms of finance for these programs have all made progress difficult.”
Health Care’s New Emphasis on Social Determinants of Health NEJM Catalyst Innovations in Care Delivery, Volume 4, Issue 4, April 2023. https://catalyst.nejm.org
Re: Digital health investing: “As demand for easier access to care accelerates, digital health is set to benefit from greater demand for personal care navigators and a desire for new ways to find and receive care virtually. While there are many key areas of opportunity for startups in digital health, risks for companies in the sector include competition and market fragmentation—particularly in primary telehealth and wellness—the necessity of scaling up to achieve profits, and the need to overcome point solution fatigue of payers and employers. In our view, to be successful, digital health companies must
provide comprehensive health services with combined telehealth and care coordination, have a clear strategy to reach large populations of members and/or deliver care for currently unmet medical needs.
In 2022, VC activity in digital health totaled $7 billion, 55% lower than the $15.6 billion of funding in 2021, although funding levels were flat compared to 2020. Activity has also been light over the first couple months of 2023, and few market participants expect the funding environment to make afull comeback this year. Still, VCs have plenty of dry powder to invest in high-growth digital health categories, and there is a significant backlog of companies expected to go public once the IPO market recovers. We expect VC funding and exit activity—both M&A and IPOs—to pick up by the end of 2023, although we anticipate it will take until 2024 for investments and exits to return to longer-term trajectories.”
EMERGING TECH RESEARCH Launch Report: Digital Health Pitchbook March 18, 2023 www.pitchbbok.com
Public Health
Study: long-term impact of pandemic: National Academies report focused on Black, Latino, and Native American families and low-income families. These statistics stopped me in my tracks:
- 65% of children who lost a parent or primary caregiver to Covid-19 are from Black, Latino, or Native American families.
- The steepest declines in early childhood program enrollments were among families from those groups, or families that have low-incomes or do not speak English at home.
- Relative maternal mortality rates increased by 33%, with the largest increases for Black and Latina women.
“Across almost every outcome, low-income and racially and ethnically minoritized children and their families have borne the brunt of the pandemic’s negative effects, and without urgent, thoughtful interventions for their health and well-being, they will continue to bear it”
National Academies of Sciences, Engineering, and Medicine. 2023. Addressing the
Long-Term Effects of the COVID-19 Pandemic on Children and Families.
Washington, DC: The National Academies Press. https://doi.org/10.17226/26809
CDC: Maternal mortality climbs in U.S.: Per the CDC, 1,205 women died of maternal causes — defined by WHO as related to pregnancy and occurring within 42 days after pregnancy — compared with 861 in 2020 and 754 in 2019. While the increases from 2020 to 2021 were significant for all racial and ethnic groups, the rate for Black women was 2.6 times the rate for white women.
National Center for Health Statistics www.cdc.gov/nchs
Hospitals
KFF study: Nonprofit hospitals received $28 billion in taxpayer subsidies in 2020 but provided $16 billion in free or discounted care: Per the Kaiser Family Foundation’s program on Medicare policy analysis:
- Nonprofit hospitals saw the collective value of their tax exemptions rise from an estimated $23.7 billion in 2019 to $27.6 billion in 2020 thanks in part to “substantial amounts” of government relief funding.
- The 2020 total represents 43% of the net income nonprofit hospitals reported earning in 2020, KFF analysts wrote. It’s just a few billion below the $31.9 billion in Medicare and Medicaid disproportionate share hospital payments received that same year, KFF analysts wrote, and $11.6 billion more than the total charity care costs those hospitals reported.
- The value of tax exemptions grew 41% from about $20 billion in 2011 to about $28 billion in 2020.
PK note: Prior studies offer conflicting results largely based on differing methodologies:
- Lown Institute analyzed 275 nonprofit hospital systems’ 2018 and 2019 IRS filings and tallied an $18.4 billion charity care deficit.
- Johns’ Hopkins researchers that reviewed data sources from 1,472 hospitals between 2011 to 2018 found that 38.5% of nonprofits provided less community benefit than the value of their tax exemptions.
- Ernst and Young study funded by the American Hospital Association found that nearly 2,500 tax-exempt hospitals provided just over $110 billion in total community benefits. Nearly half of those total community benefits, $51.1 billion, were comprised of financial assistance, unreimbursed Medicaid and other unreimbursed costs from means-tested government programs During the same year, roughly $12.4 billion in tax revenue was foregone through a combination of federal corporate income tax exemption, tax-exempt bond financing and federal unemployment tax exemption, Ernst & Young found.
Godwin et al The Estimated Value of Tax Exemption for Nonprofit Hospitals Was Nearly $28 Billion in 2020 KFF March 14, 2023 www.kff.org/health-costs/issue-brief/the-estimated-value-of-tax-exemption-for-nonprofit-hospitals-was-nearly-28-billion-in-2020
Modern Healthcare: 2022 Hospital System Results: Comparing the financial performance and inpatient volumes for the top investor-owned and not-for-profit systems:
Investor-owned: (HCA, Universal, Tenet, CHS)
- Inpatient Admissions chg from 2021: -1.0%
- ’22 Operating Profit (unweighted avg): +$1,911B/system
Not for Profits: (Ascension, Common Spirit, Mayo, Providence)
- Inpatient Admissions chg from 2021: -3.9%
- ’22 Operating Profit (unweighted avg): $-1.9B/system (includes Mayo + $2.2B income)
Caroline Hudson “Health systems struggle to fill beds amid care delivery shifts” Modern Healthcare March 16, 2023 www.modernhealthcare.com/patient-care/health-systems-pre-covid-inpatient-volumes-fitch-tenet
Physicians
Fair Health study: primary care utilization: FAIR Health analyzed private healthcare claims to provide an assess primary care utilization. Highlights:
- Nationally, 29% of patients who received medical services between 2016 and 2022 did not
visit a primary care provider. (high of 43% in Tennessee to a low of 16 % in Massachusetts). - Of the providers who performed primary care services in 2016-2022, 56% were physicians,
while 44% were nonphysicians - Nurse practitioners constituted the largest share of primary care providers by specialty (27
%), followed by family medicine physicians (20%), internal medicine physicians (18
%) and physician assistants (15%). Smaller percentages were accounted for by
pediatricians, obstetricians/gynecologists and others
A Window into Primary Care An Analysis of Private Healthcare Claims
A FAIR Health White Paper, March 15, 2023
2023 National Resident Match Day Results: Highlights:
- A total of 48,156 applicants participated in the 2023 Match, up by 481 from last year — 707 more non-U.S.-citizen IMG [international medical graduate] applicants and 153 more U.S. osteopathic (DO) seniors while the number of U.S. MD senior applicants dropped by 236.
- Those specialties with 30 positions or more that filled all available positions were orthopedic surgery, plastic surgery (integrated), radiology-diagnostic, and thoracic surgery. On the other hand, there were 554 unfilled emergency medicine slots in 2023, an increase of 335 compared to last year followed by internal medicine 380, pediatrics with 86, and psychiatry with 21.
- A total of 17,844 primary care residency slots were offered this year, up by 571 from last year. And primary care positions filled at a rate of 94.2%, similar to last year. 4,530 medical students and graduates matching into family medicine residency programs. This year, family medicine offered 5,107 residency positions, 172 more than in 2022, totaling 13.6% of positions offered in all specialties with more programs offering positions than any other specialty.”
NRMP® Celebrates Match Day by Publishing the Results of a Record-Breaking 2023 Main Residency Match March 17, 2023 www.nrmp.org/about/news/2023/03/nrmp-celebrates-match-day-by-publishing-the-results-of-a-record-breaking-2023-main-residency-match
Consumers
Urban Institute survey: medical debt:
- 15% of nonelderly American adults have past-due medical debt: 28% of these owe all of their debt to hospitals, and another 45% said they owe that debt to hospitals and other providers.
- Most owed at least $1,000 while 1 in 5 of those surveyed owed more than $5,000.
Most Adults with Past-Due Medical Debt Owe Money to Hospitals KFF March 13, 2023
CONSUMER PRICE INDEX – FEBRUARY 2023: Last Tuesday, the Det of Labor released the latest CPI data for February. Highlights:
- CPI for urban consumers rose 0.4% in February on a seasonally after increasing 0.5% in January.
- Over the last 12 months, the all-items index increased 6.0 percent before seasonal adjustment. The index for shelter was the largest contributor to the monthly all items increase, accounting for over 70% of the increase, with the indexes for food, recreation, and household furnishings and also contributing.
- The food index increased 0.4% over the month with the food at home index rising 0.3%The energy index decreased 0.6% over the month as the natural gas and fuel oil indexes both declined.
- The all-items index increased 6.0% for the 12 months ending February– the smallest12-month increase since the period ending September 2021. The all items less food and energy index rose 5.5% over the last 12 months, its smallest 12-month increase since December 2021. The energy index increased 5.2 % for the 12 months ending February, and the food index increased 9.5%. over the last year.
- The medical care index fell 0.5% in February, after falling 0.4% in January. The index for physicians’ services continued to decline, falling 0.5% after declining 0.1% in January. The hospital services index and the prescription drugs index were unchanged in February.
- The Medical Care Commodities CPI was up .1% in February and 3.2% over the last 12 months. The Medical Care Services CPI was down .7% in February and is up 2.1% in the past 12 months.
Consumer Price Index Summary US Bureau of Labor Statistics March 14, 2023 ttps://www.bls.gov/news.release/cpi.nr0.htm
Regulation
Update: Abortion Legislation: Friday, Wyoming became to the first state to outlaw abortion altogether; restrictions on abortion pills is being considered in the Iowa, Texas and Arizona legislatures along with anti-abortion legislation in 15 other states still pending.
Wyoming’s new law comes as a preliminary ruling is expected soon by a Texas judge that could order the U.S. Food and Drug Administration to withdraw its approval of mifepristone, the first pill in the two-drug medication abortion regimen. Such a ruling, if it stands, could upend how abortion is provided nationally, affecting states where abortion is legal as well as states with bans and restrictions. Wyoming’s law would take effect on July 1 and would make it illegal to “prescribe, dispense, distribute, sell or use any drug for the purpose of procuring or performing an abortion.” Doctors or anyone else found guilty of violating this law would be charged with a misdemeanor, punishable by up to six months in prison and a $9,000 fine. The law explicitly says that pregnant patients will be exempt from charges and penalties.
David W. Chen and Pam Belluck Wyoming Becomes First State to Outlaw Abortion Pills New York Times March 16, 2023 ww.nytimes.com/2023/03/17/us/wyoming-abortion-pills-ban.html?campaign
CMS announces drug price ceiling violations: Last week, the Centers for Medicare and Medicaid Services named 27 drugs that had the large price increases, including rheumatoid-arthritis treatment Humira from AbbVie Inc. and Yescarta lymphoma therapy from Gilead Sciences Inc., and will face the price-increase penalty in the form of a rebate.
The federal government will start billing the pharmaceutical companies that sell the medicines for the rebates in 2025, according to the health officials. Companies that don’t pay could face a penalty that is 125% of the rebate amount.
CMS www.cms.gov
MACPAC: Medicaid enrollment decrease anticipated:” As in prior years, the Commission continues to find little meaningful relationship between state DSH allotments and the number of uninsured individuals; the amounts and sources of hospitals’ uncompensated care costs; and the number of hospitals with high levels of uncompensated care that also provide essential community services for low-income and uninsured populations.
MACPAC estimates that fiscal year 2024 DSH allotments will be reduced by 54% ($8 billion) on October 1, 2023, due to scheduled reductions that were implemented as part of the Consolidated Appropriations Act, 2021.
A total of 27.2 million people, or 8.3% of the U.S. population, were uninsured in 2021, a 0.3 % decline from 2020. Some of the decline in the uninsured rate may be attributed to the continuous coverage requirements implemented during the PHE. Overall, we observed that the COVID-19 pandemic had a considerable effect on hospital finances. Hospitals reported $41.9 billion in hospital charity care and bad debt costs on Medicare cost reports in fiscal year 2020, or about 4.1% of hospital
operating expenses. Uncompensated care as a share of hospital operating expense has largely remained unchanged since 2015. In FY 2020, the aggregate operating margin for all hospitals was much lower than it has been in previous years because of the financial disruptions from the COVID-19 pandemic, and deemed DSH hospitals continued to report a lower aggregate operating margin than other hospitals. However, after accounting for DSH payments and federal provider relief funding authorized during the PHE, the aggregate total margin was similar for both deemed DSH hospitals and other hospitals.”
Note: 15 million people may drop off Medicaid rolls in 2023 as states redetermine program eligibility with the end of the COVID-19 public health emergency per a Kaiser Family Foundation survey of state officials found. States that were able to report projected coverage losses estimate that about 18% of Medicaid recipients will be disenrolled after program rolls surged during the pandemic.
More than 91 million adults and children were covered by Medicaid or CHIP as of November. Eligibility redeterminations will start next month, prompted by the end of policies that guaranteed continuous coverage during the health emergency.
Report to Congress on Medicaid and CHIP Medicaid and CHIP Payment and Access Commission March 2023 www.macpac.gov/wp-content/uploads/2023/03/MACPAC_March-2023-Report
