HHS: Medicaid expansion cut uncompensated care by $7.4B

The expansion of Medicaid program eligibility under the Affordable Care Act reduced the cost of caring for the uninsured by $7.4 billion last year, the U.S. Department of Health and Human Services announced.

Altogether, the level of uncompensated care was 21 percent lower than if the Medicaid expansion had not been put in place, according to the agency.

The 28 states and the District of Columbia--all of which expanded their Medicaid programs--saw their level of uncompensated care drop by $5 billion last year, according to the HHS data. However, states that have not expanded Medicaid eligibility saw their levels of uncompensated care drop by a much smaller number--$2.4 billion.

The overall savings is significantly higher than the $5.7 billion HHS had previously calculated hospitals had saved in uncompensated care costs.

Medicaid expansion has been a bitter issue, with many politically conservative states in the South and Midwest refusing to do so. But those states have paid a price in deferred economic growth and a heavier financial burden borne by its hospitals, according to the HHS data. 

Overall, the states have reduced hospital bad debt by $1.9 billion, although expansion states saw it drop by $1.1 billion, compared to $800 million in the non-expansion states. Charity care costs saw a drop of $5.5 billion, with $3.9 billion in savings in the expansion states versus $1.6 billion in the non-expansion states.

In a separate report, the HHS found that Medicaid expansion would lead to job growth and other economic boosts through the end of this decade. For example Kentucky, one of the few southern states to expand Medicaid, will likely see $1.7 billion in economic growth and 14,700 new jobs between last year and 2016.

To learn more:
- read the HHS bad debt data (.pdf)
- check out the HHS economic growth data (.pdf)