Critical access hospitals may need more than Medicaid expansion to improve finances, study finds

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Critical access hospitals in states that expanded Medicaid did not have a significant increase in operating margins compared to hospitals in states that have not expanded Medicaid, showing that such hospitals may need additional steps to improve finances, a December Health Affairs study found.

The study found that the operating margins of critical access hospitals in Medicaid expansion states were 1.3 percentage points higher than in nonexpansion states. 

The study found improvements in quality of care after expansion — but the quality ratings increases were reported in both expansion and nonexpansion states. Before expansion, 72.9 percent of patients in expansion states rated hospitals' quality of care as a 9 or 10 on a 1-10 scale, compared to 73.6 percent in nonexpansion states; after expansion, 75.7 percent of patients in expansion states gave ratings of 9 or 10, compared with 76.8 percent in nonexpansion states.

The study identified critical access hospitals using 2011-18 data from the Healthcare Provider Cost Reporting Information System from CMS. The sample size had 1,158 critical access hospitals, with 648 in Medicaid expansion states and 510 in nonexpansion states.

Previous studies focusing exclusively on rural critical access hospitals have shown that Medicaid expansion has helped finances and decreased the chances of closures. This study looked at critical access hospitals nationally, including the 15 percent of those outside of rural communities.

Read more here.

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