THE VALUED VOICE

Legislative Edition

Tuesday, June 28, 2022

   

Wisconsin Hospitals Commit More Resources to Communities, Face Larger Medicare Losses

Hospitals across the nation committed 13.9% of their overall expenses to community benefit, equating to $110.9 billion each year, according to the American Hospital Association (AHA) and an Ernst & Young analysis of non-profit hospital expenses.
 
Annual community benefits made by Wisconsin hospitals, when calculated in the same manner as the AHA report, result in 21.2% of all expenses—largely driven by significant losses from Medicare and Medicaid, accounting for 78.8% of all community benefits. In total, Wisconsin hospitals provide $4.9 billion in benefits to Wisconsin communities as a commitment they make for being a non-profit, tax-exempt organization. 
 
This data also shows how poorly Medicare reimburses Wisconsin hospitals. According to AHA’s data, hospitals nationally experience a 3.1% shortfall in Medicare reimbursement as a percentage of their overall expenses. In Wisconsin, Medicare losses to hospitals account for a whopping 12% of their expenses.
 
Medicare reimburses Wisconsin hospitals only 73% of their costs, while Medicare reimbursement to the rest of the country amounts to 84% of cost. Similarly, Wisconsin’s Medicaid program reimburses hospitals only 66% of cost, while the national average for state Medicaid reimbursement is equivalent to 88% of cost. This is important to understand because for the vast majority of Wisconsin hospitals, Medicare and Medicaid patients make up more than half of their overall business.
 
WHA Logo
Tuesday, June 28, 2022

Wisconsin Hospitals Commit More Resources to Communities, Face Larger Medicare Losses

Hospitals across the nation committed 13.9% of their overall expenses to community benefit, equating to $110.9 billion each year, according to the American Hospital Association (AHA) and an Ernst & Young analysis of non-profit hospital expenses.
 
Annual community benefits made by Wisconsin hospitals, when calculated in the same manner as the AHA report, result in 21.2% of all expenses—largely driven by significant losses from Medicare and Medicaid, accounting for 78.8% of all community benefits. In total, Wisconsin hospitals provide $4.9 billion in benefits to Wisconsin communities as a commitment they make for being a non-profit, tax-exempt organization. 
 
This data also shows how poorly Medicare reimburses Wisconsin hospitals. According to AHA’s data, hospitals nationally experience a 3.1% shortfall in Medicare reimbursement as a percentage of their overall expenses. In Wisconsin, Medicare losses to hospitals account for a whopping 12% of their expenses.
 
Medicare reimburses Wisconsin hospitals only 73% of their costs, while Medicare reimbursement to the rest of the country amounts to 84% of cost. Similarly, Wisconsin’s Medicaid program reimburses hospitals only 66% of cost, while the national average for state Medicaid reimbursement is equivalent to 88% of cost. This is important to understand because for the vast majority of Wisconsin hospitals, Medicare and Medicaid patients make up more than half of their overall business.
 

Other Articles in this Issue