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Hospitals see lower costs since insurance expansion

SANTA FE — Hospitals in New Mexico are reporting lower costs for providing care to patients without insurance since the state expanded Medicaid under President Barack Obama’s health care law.

A report by the Legislative Finance Committee shows more patients are covered with some type of private insurance or government-issued Medicaid coverage, lowering the cost of indigent care for hospitals across the state, the Santa Fe New Mexican reports.

For years, executives at hospitals in the state said their top  concern was the cost of providing care to patients without insurance. But the rate of uninsured adults has declined from 18 percent in 2013 to 13 percent this year, according to the report, significantly affecting uncompensated care.

This is the first study of indigent health care costs since federal law mandated that most people must have health insurance or pay a fine.

“I don’t know that we’ve turned the corner, but certainly there has been a lot of improvement,” said Jeff Dye, executive director of the of the New Mexico Hospital Association. “There is an overall decrease in uncompensated care, and that’s good.”

According to the report, since the health care reforms were put in place, uncompensated care costs have dropped 21 percent across all states and 26 percent in states like New Mexico that expanded Medicaid coverage.

“All indications are that uncompensated care costs will continue to decline, but they will not disappear altogether,” according to the LFC analysis.

The Affordable Care Act also increases reimbursement for Medicaid patients who stay overnight at hospitals, providing $142 million to New Mexico hospitals, according the report. That figure is expected to climb another 10 percent.

Dye said the situation has improved, but as undocumented residents do not qualify for Medicaid, there will always be patients without insurance because they cannot afford premiums. Tribal members are also exempt from the requirement to have health insurance.