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Unpaid Medical Bills Rise As Congress Weighs Obamacare Fix

Hospitals are seeing unpaid bills rise again just as Congress begins to consider this week the future of cost-sharing reductions  that help low income Americans pay their co-payments and deductibles under the Affordable Care Act, Forbes writes.

Across the country, hospitals are beginning to see an increase in bad debt, charity care expenses and related uncompensated care costs because employers and commercial insurers are shifting more costs onto patients.

At HCA Holdings, the nation’s largest hospital chain, says its uncompensated care including bad debt and charity care are rising faster this year than last. HCA owns 177 hospitals and 119 surgery centers in 20 states.

“We’re seeing roughly a 4% to 5% growth in uninsured admissions,” HCA chief financial officer William Rutherford said during the company’s second-quarter earnings call. “That’s a little higher than we ran in the last half of 2016 and first quarter.”

Another large for-profit hospital operator, Tenet Healthcare said uncompensated care costs that dropped from 2015 to 2016 are now on the rise. “In our hospitals, volumes have been softer than anticipated and an increase in uninsured revenue has resulted in upward pressure on uncompensated care expense,” Tenet CFO Daniel Cancelmi said on the company’s second-quarter earnings call.

This comes even as the nation’s uninsured rate has hit historical lows of less than 9% of the U.S. population, according to a new report out from the Centers for Disease Control & Prevention.

But that’s a trend that could reverse.

Unpaid hospital bills could continue to pile up even faster if President Donald Trump and Congress don’t make a long-term commitment to cost-sharing reductions (CSRs). Without the CSRs, Obamacare customers won’t be shielded from their deductibles and co-payments and face cost increases of 20%-25% or more, insurers say.

Trump committed to funding CSRs for August but not beyond that despite intensifying pressure from the healthcare industry. At least one Congressional committee meets later this week to discuss the cost-sharing issue. “Extending cost-sharing reduction payments through 2018, is a priority for Sen. Lamar Alexander, the Tennessee Republican who chairs the Senate Health, Education, Labor and Pensions Committee,” Sen. Alexander’s home state newspaper, the Nashville Tennessean, reported.

Hospitals worry patients will drop coverage or at the very least be unable to pay their co-pays, deductibles and related cost-sharing responsibilities.

“Failure to maintain this funding could jeopardize coverage for millions of people who purchase insurance in the individual market, including many patients who receive care at essential hospitals,” said Dr.Bruce Siegel, CEO of America’s Essential Hospitals, which represents public health systems.

Meanwhile, the 19 states that didn’t expand Medicaid under the ACA could be at the beginning stages of a major increase in unpaid medical bills and related uncompensated care expenses.

In Texas, which didn’t expand Medicaid under the ACA, major hospitals in the Dallas area are seeing huge increases in bad debt expenses from patients unable to pay their medical bills. The Dallas Morning News last month reported that three of the largest health systems in the Dallas area had almost $1.9 billion in uncompensated care last year.” And that’s “up more than 80% since 2013 the year before ACA-compliant policies were billed,” the newspaper reported.

In all states that didn’t expand Medicaid, it could get worse. By 2026, America’s Essential Hospitals projects “hospitals will see $81.5 billion more in uncompensated care than expected when Congress passed the ACA in 2010.”

 

Unpaid Medical Bills Rise As Congress Weighs Obamacare Fix - overview

Summary: Hospitals are seeing unpaid bills rise again just as Congress begins to consider this week the future of cost-sharing reductions that help low income Americans pay their co-payments and deductibles under the Affordable Care Act.

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