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What Happened to the Spike in Uncompensated Care?

Michelle Pointe, for HealthLeaders Media, July 6, 2009

Because accounting methods for uncompensated care can vary between for-profit hospital operators, it is difficult to determine total uncompensated care across the sector and to compare from hospital to hospital. There is no single reliable metric that pinpoints total uncompensated care across the for-profit hospital industry that is publicly available, says Diaz.

"One metric that people usually point to is bad debt as a percentage of revenue, and I don't think that tells the story because there are different treatments of what you deem to be charity care," says Diaz. Additionally, he notes, hospitals may differ in how deep a self-pay discount they offer. "So it doesn't make for a very comparable metric." A better metric to look at is the combination of bad debt expense, and the amount of charity care, and discounted care provided in the reporting period, says Diaz.

While the overall news comes as somewhat of a relief, hospitals probably aren't in the clear. Diaz believes that for-profit hospitals could still experience a surge in uncompensated care. "Hospitals need to retain that focus they have applied because there is still a possibility that we will start to see some of those trends come through."


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Michelle Ponte

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