MN hospitals see drop in unpaid bills for care; MNsure is one reason

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State health officials credit health care reform for a drop in the amount of uncompensated care that Minnesota hospitals provided in 2014.

The Minnesota Department of Health said Tuesday that hospitals in the state saw a "dramatic" drop in uncompensated care, driven by a 22.4 percent decline in charity care last year – the first year that major portions of the Affordable Care Act went into effect.

It's also the first time since 2001 that the amount of charity care has gone down in Minnesota, according to the MDH.

Charity care is defined as care that hospitals provide without expecting any payment, and is one indicator of how many people don't have insurance coverage when they seek health care. It totaled $120 million for Minnesota hospitals in 2014, MDH notes.

Minnesota's new health care exchange, called MNsure, was fully up and running last year and enabled many residents who were uninsured to sign up for health care coverage at reduced costs.

While MNsure continues to deal with technical glitches, it still led to Minnesota’s uninsured rate falling to an all-time low of 5.9 percent, according to data released by the Census Bureau earlier this month.

Hospitals also carry bad debt, which is defined as care hospitals expect to be paid for, but don't receive.

Minnesota hospitals' bad debt increased last year, reflecting higher health care costs as well as higher deductibles and copays that many insurance policies require of patients, according to the health department.

The report notes that bad debt carried by hospitals has been steadily increasing over the past several years.

According to the health department's report, the 9.3 percent increase in hospitals' bad debt - to $174.2 million - was more than offset by the reduction in charity care. So Minnesota hospitals actually saw a net decline of 6.3 percent in uncompensated care overall last year.

State Health Commissioner Ed Ehlinger said in a news release he's pleased to see more Minnesotans with health insurance, but the rising cost of health care is still a problem for many people.

"Without addressing health care costs through additional reforms and prevention efforts, even those patients with insurance increasingly are struggling with medical bills and unpaid care or bad debt,” Ehlinger said.

The Hennepin County Medical Center was the largest provider of uncompensated care in Minnesota last year, followed by the two Mayo hospitals in Olmstead County. Regions Hospital in St. Paul was fourth.

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