The implementation of the Patient Protection and Affordable Care Act (ACA) is changing hospital reimbursement in important ways. One of the most significant changes is the expansion of health insurance coverage to previously uninsured populations. Since rural residents are more likely than urban residents to be uninsured, coverage expansion should, in theory, provide a new source of revenue for rural hospitals and, therefore, improve financial performance. However, the ultimate financial impact of the ACA on rural hospital providers is uncertain.

The second year of this two-year project will explore the effects of changes in insurance coverage under health reform on the following outcomes in rural hospitals:

(1) Bad debt
(2) Charity care
(3) Payer mix (Medicare, Medicaid, other)
(4) Financial performance

Results will inform federal and state agencies, rural providers and communities as to how implementation of the ACA is impacting reimbursement and financial performance of rural hospitals. This will allow the Federal Office of Rural Health Policy and State Offices of Rural Health to identify emerging challenges, and identify strategies or policy changes needed to deal with any unintended consequences.

Publications

• Uncompensated Care Burden May Mean Financial Vulnerability for Rural Hospitals in States That Did Not Expand Medicaid
  Journal Article
  North Carolina Rural Health Research and Policy Analysis Center
  Date: 10/2015
  Explores the differences of rural hospitals in states with Medicaid expansion and those with nonexpansion, in terms of the amount of uncompensated care they provided and their profitability and market characteristics in 2013.