Uncompensated care costs at Minnesota hospitals have declined by about 17 percent since the implementation of the federal Affordable Care Act, with the health law apparently helping more Minnesotans cover their medical bills.
In 2015, uncompensated care at hospitals fell from $305 million to $268 million, according to a Monday report from the Minnesota Department of Health.
It was the second consecutive annual decline, and took uncompensated care costs to their lowest level in Minnesota since 2008. Uncompensated care costs include expenses for charity care, in which hospitals provide care without expecting payment, and "bad debt," where hospitals expect to receive payment but ultimately don't receive it.
The study provides circumstantial evidence on the impact of coverage expansion under the health law, although it can't prove a connection.
"We can't really make inferences about the causal relationship, but there aren't really any other factors at play that could have caused this substantial decline," said Stefan Gildemeister, the state health economist, in an interview. "So, it's not a coincidence, even though we can't demonstrate a statistical relationship between the two factors."
A reduction in uncompensated care is important, Gildemeister said, because "it's likely that fewer people are rationing their own health care or experiencing fragmentation in care."
The Affordable Care Act allowed states to expand Medicaid coverage for low-income residents, with Minnesota doing so in stages during 2011 and 2014. The health law in 2014 also started providing federal tax credits to subsidize the purchase of individual health insurance policies through new government-run exchanges like Minnesota's MNsure website.
In 2013, hospitals in Minnesota saw a record $321 million in uncompensated care costs following steady — and sometimes steep — annual increases across most of the previous decade. The decline started in 2014 when the federal health law expanded health insurance coverage.
