Trauma centers care for all patients regardless of their ability
to pay - and prior studies have shown that almost 20% of patients
admitted for trauma care in the United States lacked health insurance.
Given the low reimbursement rates for patients without insurance,
trauma centers are often considered among the most financially
vulnerable of U.S. hospitals.
One of the objectives of the Patient Protection and Affordable
Care Act (ACA) is to reduce the overall number of uninsured individuals
by expanding access to health insurance. Under the law, states may
choose to expand their Medicaid programs to low-income residents who
lack health coverage.
‘Trauma centers that care for the greatest proportion of uninsured patients stand to gain the most financially from state expansion of the Medicaid program.’
By the end of June 2016, 31 states and the
District of Columbia had expanded their Medicaid programs; however, 19
continue to refuse federal funding that would extend Medicaid coverage
to low-income residents.
Trauma centers stand to gain the most financially from state expansion of the Medicaid
program. Findings from the first nationwide examination of the
anticipated effect of Medicaid expansion on the financial status of
trauma safety net hospitals were reported at the 2016 Clinical Congress
of the American College of Surgeons.
Recent studies have examined the effects of Medicaid expansion on
the total number of uninsured and the financial performance of all
hospitals in an individual state or on a few selected hospitals in a
small number of states. The present study evaluated the anticipated financial impact of
Medicaid expansion on trauma centers that treated the highest number of
uninsured trauma patients across the country.
"Trauma centers have a
high proportion of uninsured patients because they do not turn anyone
away for trauma care. We looked at trauma centers that take care of the
highest proportion of patients without insurance to determine whether
state-level Medicaid expansion benefits the facilities and the patients
that are at greatest financial risk," said lead author John W. Scott,
a resident in general surgery and the Henry Ellis Warren
Research Fellow for the Center for Surgery and Public Health (CSPH),
Brigham and Women's Hospital, Boston.
A research team of surgeons, health economists, and health policy
analysts from CSPH obtained information from the National Inpatient
Sample (NIS), which is the largest publicly available all-payer
inpatient database. It gathers information on approximately seven million
hospital stays each year.
From NIS, the researchers selected data on adults who had been
treated for trauma in 2010, the year before ACA policies went into
effect. Data were confined to adults with low incomes who were between
the ages of 18 and 64, the typical Medicaid patient population. Using
NIS cost-to-charge ratios and published payer-specific reimbursement
rates, total reimbursements and trauma-related financial margins were
calculated based on payer type: private insurance, Medicaid, uninsured,
Facilities were categorized by the percentage of uninsured trauma
patients they treated and safety net hospitals were defined as those
hospitals that treated the highest quartile. "This information gave us
an understanding about the reimbursements hospitals received for the
trauma care they provided before passage of the ACA," Dr. Scott said.
With these data, CSPH researchers conducted a simulation that
would determine the differences in health coverage and hospital
financial performance in states that expanded Medicaid and those that
"We don't have the luxury of having years of data to look back
upon; we have to conduct the best analysis we can of the available
information. We created a post-ACA model that incorporates what we know
about the law and about projected Medicaid enrollment estimates in order
to determine the number of patients who would be eligible for health
coverage and how that would affect finances at the hospital level. The
results reflect our estimates of the impact on hospital finances and
reimbursement for trauma care specifically due to Medicaid expansion
under the ACA," Dr. Scott explained.
According to the simulation model, nearly the same proportion of
previously uninsured patients would gain private health coverage in
Medicaid expansion and non-expansion states, 54% and 49%
respectively, either through health insurance exchanges or through
employer sponsored coverage.
However, nearly three times as many patients would gain health
insurance through Medicaid in expansion states than in non-expansion
states, 31% versus 12% respectively.
Accordingly, safety net hospitals would have the greatest
absolute gain in financial margin; gains were projected to be up 26.2% in Medicaid-expansion states versus 18.9% in
"The facilities we will expect to gain the most from the ACA
Medicaid expansion are those that are furthest behind to begin with.
The change in reimbursement for trauma care will likely be greatest in
states that have made the most effort to expand insurance coverage,
namely Medicaid," Dr. Scott said.