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Study: Providers See Financial Gains with Medicaid Expansion

By Marissa Evans, CQ Roll Call

June 8, 2016—Health care providers in states with expanded Medicaid programs are seeing financial gains that have helped them increase services and hire more staff, according to a new study from the Georgetown University Center for Children and Families.

A report released on Wednesday found that safety-net providers in states that have expanded Medicaid were seeing fewer uninsured low-income patients, a result that has allowed hospitals to redirect dollars to other needs.

"Our interviews suggest that Medicaid expansion has had a substantially positive impact on safety net health care providers located in expansion states," researchers wrote. "Furthermore, the positive impact has been felt beyond the walls of these health care facilities."

Under the 2010 health law, states can broaden eligibility for the joint federal-state health insurance program for the poor. The federal government picks up the tab until 2017, when states will then have to share the costs until by 2020, they would pay for 10 percent of the expansion population's spending on their own. Thirty-one states and the District of Columbia are participating.

In a series of interviews with hospital executives and federally qualified health centers, or FQHCs, in states that expanded Medicaid, researchers found that providers are using the cash infusion to increase services for behavioral health and primary care, hire more staff, open or improve health centers and clinics, and upgrade equipment.

Meanwhile, many providers in non-expansion states were financially struggling and taking on uninsured patients, according to the study. Researchers found that providers in these states were less likely to see a decrease in uncompensated care. Some of the providers interviewed said their state not expanding Medicaid has led to layoffs and clinic closures.

However, while providers in expansion and non-expansion states saw a difference in finances, there was a shared concern about being unable to connect patients with specialists.

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