Congress is weighing Medicaid spending cuts of up to $880 billion or more over the next 10 years, but the reductions are expected to be a major headwind for hospitals, where 26% of inpatient visits are paid for by Medicaid, KFF Health News reported May 5.
KFF used RAND hospital data to find the annual cost reports of Medicare-certified hospitals. The analysis examined nonfederal, general short-term hospitals in all 50 states and the District of Columbia.
Here are five things to know:
1. Cuts to Medicaid spending would likely directly affect 83 million people covered by Medicaid. Moreover, the cuts could have broader impacts on the economy, given hospitals are the sixth largest employer in the country. Rural hospitals are expected to suffer disproportionately. The National Rural Health Association argued that Medicaid spending cuts would lead to more service closures in rural hospitals, or full hospital closures.
2. Medicaid covered at least 1 in 5 inpatient hospital days in 48 states and the District of Columbia in 2023.
3. In 10 states, at least 30% of inpatient hospital days were covered by Medicaid. They were evenly split among largely rural states such as Alaska, Kentucky, Louisiana, Nevada and Oklahoma, and more populated states such as California, Colorado, the District of Columbia, New Mexico and New York.
4. Medicaid covered 41% of births nationally in 2023 and 47% of births in rural areas. The vast majority of births occurred in hospitals.
5. Certain premium tax credits for the ACA are set to expire in 2026 and could impact hospitals. If the credits expire, the number of uninsured people would likely increase by 3.8 million per year on average, according to Congressional Budget Office projections.
