Expect Nebraska’s hospitals to be among the strongest backers of expanding the state Medicaid program to cover almost all low-income Nebraskans. They’ve got $29 million riding on the issue.
That’s how much hospitals in the state now get from the federal government under Medicaid’s Disproportionate Share Hospital program. The money goes to hospitals that treat large numbers of uninsured and underinsured patients, thus racking up higher-than-average amounts of uncompensated care.
In 2010, Nebraska hospitals report that they provided about $1.1 billion worth of uncompensated care. The total includes charity care, subsidized care, bad debt and the difference between costs and reimbursements for Medicaid and Medicare.
Hospitals nationally agreed to give up their DSH payments to help pay for the federal health care overhaul. In return, they expected to see their uncompensated care figures go down as health insurance exchanges and an expansion of Medicaid reduced the number of people without coverage.
The law called for providing Medicaid coverage to people making up to 133 percent of the federal poverty guidelines. Currently, the only adults covered by Nebraska Medicaid are parents of minor children, the disabled and the elderly. Income limits for those groups is below the 133 percent level.
But the U.S. Supreme Court’s June ruling made the Medicaid expansion optional for states and threw a monkey wrench into the arrangement. Hospitals now face a possible future in which they lose their DSH payments and still have to take care of large numbers of low-income, uninsured people. The situation would put pressure on private insurance, as hospitals raise prices on those with coverage to balance their bottom lines.