New NORC report details financial pressures and critical role of hospitals serving urban communities

Hospitals serving marginalized urban communities need additional federal support to fulfill their mission to advance the health of the patients and communities they serve.

The AHA recently commissioned NORC at the University of Chicago to examine the unique characteristics, community services, and patient demographics of a select group of vital urban hospitals that provide essential health care and other services. to marginalized and underserved communities. The AHA also asked NORC to examine the financial challenges limiting the ability of these hospitals to continue to meet the complex needs of the communities they serve.

Financial Challenges of Hospitals Serving Marginalized Urban Communities

NORC’s research examines a select group of urban hospitals that serve patients with disproportionately complex needs, including the management of multiple chronic conditions. Their patients mostly live in historically marginalized communities, and are often low-income and more likely to be uninsured or covered by Medicare, Medicaid, or other government health care programs. Many patients treated in these hospitals face socioeconomic challenges, such as food insecurity, community violence, and lack of safe and affordable housing.

Hospitals surveyed by NORC are more likely than other hospitals in the same metropolitan areas to offer a full range of essential services, such as neonatal intensive care, inpatient psychiatric services, treatment for substance use disorders , HIV/AIDS care and burn care. They are also more likely to offer innovative programs that address social factors that influence health and work to eliminate health disparities.

While the financial challenges facing the entire hospital field are immense, NORC has found that these hospitals face unique and ongoing financial pressures. Patients treated by these urban hospitals are much more likely to be enrolled in Medicaid or uninsured. Historically, government programs have reimbursed hospitals less than the cost of patient care, which puts increased financial pressure on these hospitals. For example, in 2020, the hospital field received payment of just 88 cents for every dollar spent caring for Medicaid patients, a shortfall of nearly $25 billion in total. This subset of hospitals also tends to have lower markups while providing a higher level of unpaid care to uninsured patients than comparator hospitals.

In addition to the characteristics described above, the severe repercussions of the COVID-19 pandemic have created a whole new set of challenges for these hospitals, which have been hit hard by large volumes of COVID-19 cases and serious labor shortages.

Metropolitan Anchor Hospitals

The AHA supports a new designation for this select group of urban hospitals, called Metropolitan Anchor Hospitals (MAH).

The AHA is working with Congress and the administration to elevate the critical role of MAHs in the health care delivery system and advocate for policies to support these vital hospitals so they can continue to fight inequality. health and protect access to care in America’s urban communities.

Read the full NORC report at the University of Chicago and a select group of MAH case studies.

Ashley Thompson is the AHA’s Senior Vice President of Public Policy.

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