Unbiased Analysis of Today's Healthcare Issues

Hospitals moving to the ‘burbs

Written By: Jason Shafrin - Jun• 17•14

The ACA offers States the option to expand Medicaid eligibility to millions of Americans.  The goal of the expansion was to increase poor and middle class Americans’s access to affordable health care.  However, access to acute care may be getting more difficult for poor individuals.

A recent article looking at Milwaukee’s hospital market describes how hospitals are leaving the city and moving to the suburbs, where the share of individuals with private insurance is much higher.  For example,

The Aurora [hospital chain’s] expansion is part of a national push by nonprofit health systems to increase their market share in affluent and lucrative suburban markets. In all, nearly two-thirds of the roughly 230 hospitals opened across the country since 2000 are in wealthier areas, a Pittsburgh Post-Gazette/Milwaukee Journal Sentinel analysis found.

…All told,the health systems in the Milwaukee area have spent more than $750 million in the past seven years to build hospitals and clinics in the city’s suburbs. At the same time, they have invested only a fraction of that amount in Milwaukee’s poorest neighborhoods, where there is the greatest need for additional access to health care.

How big a difference is there between Medicaid and private insurance payment rates? The difference is especially large for lucrative surgical procedures.

For a coronary angioplasty that requires a two- to three-day hospital stay, for example, Medicaid pays $9,280 while commercial insurers typically pay $29,500 to $33,000.

The disparity between urban and suburban areas is especially in Wisconsin since Governor Scott Walker decided not to accept federal funds to expand Medicaid.

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