Labor shortages and Medicaid changes will lead to uneven inpatient volumes: Moody's

Continuing labor shortages and changes to Medicaid regulations are likely to make hospital inpatient volumes uneven for much of 2023, Moody's warned in a quarterly report issued Jan. 24.

While such workforce challenges will limit the ready supply of beds as hospitals struggle to discharge patients, states can also begin disenrolling residents from Medicaid in April because of changes in regulations included in the recent omnibus federal spending legislation.

Medicaid saw enrollment soar during the pandemic's height, but the end of continuous coverage requirements could result in up to 14 million people losing coverage, Moody's said. The uninsured population would therefore likely increase, leading to more self-pay patients and increased debt for hospitals.

States will also need to comply with certain Medicaid redetermination practices to be eligible for enhanced federal Medicaid assistance percentages funds. This could offer some mitigation to the overall decline in federal funds even as the FMAP will decrease each quarter and eventually be phased out by the end of 2023, Moody's said.

Hospital systems are also partnering with skilled nursing facilities to aid with post-acute care and discharge. An increasing emphasis on in-home care would also help with patient flow, Moody's said.

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