Medicaid Expansion Shown to Improve Healthcare Revenue Cycle Management

Operating a healthcare facility is no mean feat. For hospital executives, the task involves not only providing excellent medical care to patients, but it also means keeping a business afloat. After all, a hospital is an expensive venture to run—almost all of its manpower are highly skilled professionals, and the facility uses advanced equipment to help diagnose and treat ailments.

As such, keeping a healthy bottom line is crucial to any hospital’s survival. However, unpaid medical bills prove to be an all too real threat. According to a report from The Tennessean, about half of all hospital bills go unpaid. Healthcare executives know that potential bad debt can hobble their facility’s ability to deliver excellent care to the infirm.

Medicaid Expansion Can Improve Healthcare Revenue Cycle Management

A Ray of Hope 

However, a recent legislative reform can potentially reverse this trend: Medicaid expansion. The Robert Wood Johnson Foundation and Urban Institute studied 19 hospitals in Medicaid expansion states between 2013-2015 and discovered a very interesting finding. According to their data, these hospitals enjoyed a $5 million boost to their annual revenue.

Key to this revenue growth was the drastic decrease in uncompensated care costs. The study shows that the amount of unpaid medical bills was slashed from $9.4 million to just $3.2 million. On the other hand, non-Medicaid hospitals saw a $500,000 increase in uncompensated costs in 2014, before seeing a measly decline of only $1 million in 2015.

More Inclusive Healthcare 

Thanks to Medicaid expansion, fewer patients have to shell out money to cover their hospital bills, which they are unlikely to pay in full. Because these costs are subsumed under the Medicaid program, healthcare facilities are also more likely to be reimbursed for their services.

That being said, there are still challenges to be faced. The biggest of these is the fact that there are still many patients who qualify for Medicaid but are not aware of it. In short, they are forced to pay out of their own pockets, even if they are qualified to have their treatment subsidized by the government.

One of the biggest reasons for this is sheer lack of information—a lot of times, people will still look at insurance plans from the health exchanges when they can just sign up for Medicaid. In fact, has a guide on canceling your marketplace plan if you qualify for Medicaid.

However, healthcare facilities can address this knowledge gap by hiring eligibility experts who can explain Medicaid benefits to qualified patients and walk them through the application. By doing so, hospitals are more likely to avoid uncompensated costs and improve their healthcare revenue cycle management.

Medicaid Expansion Linked to $5M Annual Hospital Revenue Boost,
Canceling a Marketplace plan when you get Medicaid or CHIP,

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Categories: Revenue Cycle Management