For-Profit Hospital Chains See Financial Boost; Fitch Credits ACA
The Affordable Care Act had a positive effect on most for-profit hospital chains' finances during the first half of 2014, according to a Fitch Ratings report released Thursday, Modern Healthcare reports.
The report found that most for-profit hospital chains:
- Admitted more Medicaid beneficiaries;
- Admitted fewer uninsured patients;
- Had an improved overall payer mix;
- Improved their operating margins; and
- Reduced their bad debt.
According to Fitch, hospitals reduced bad debt by 6% since the end of last year.
In addition, researchers found that for-profit hospital chains decreased admissions in the second quarter of 2014 by less than 1%. However, after adjusting for outpatient care, the hospital chains' admissions in the second quarter increased by 2.2%.
Researchers said that for-profit hospital chains reaped greater benefits from the ACA in states that expanded Medicaid.
Fitch researchers said they expected for-profit hospital chains to continue to retain the additional patient volume. In addition, researchers said they expected the hospital chains' finances to continue improving during the second half of this year, although potentially at a slower rate (Kutscher, Modern Healthcare, 10/9).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.