Association of Medicaid Unwinding With Hospital Financial Outcomes Among General Acute Care and Critical Access Hospitals

ABSTRACT Objective To examine the association of Medicaid unwinding with hospital financial outcomes (uncompensated care costs and burden, Medicaid revenue, net financial gains, Medicaid operating margin, and total operating margin) among US general acute care (GAC) and critical access (CAH) hospitals. Study Setting and Design We used descriptive trend analysis and adjusted hospital‐level fixed‐effects panel regressions to estimate changes in outcomes. Data Sources and Analytic Sample National Academy for State Health Policy's (NASHP) Hospital Cost Tool, 2021–2024. Principal Findings Uncompensated care costs increased among both GAC ($1.1 M; CI = 0.3–1.9) and CAH ($0.2 M; CI = 0.1–0.3) hospitals and coincided with increases in Medicaid revenue within both GAC and CAH (GAC = $9.1 M; CI = 6.0–12.2 and CAH = $0.8 M; CI = 0.4–1.3) in 2024, however net financial gains (i.e., Medicaid operating profit minus uncompensated care costs) increased only within GAC ($4.9 M; CI = 2.6–7.1). Increases in uncompensated care costs were concentrated among non‐profit hospitals in both GAC and CAH (GAC = $1.7 M; CI = 0.9–2.5 and CAH = $0.2 M; CI = 0.2–0.4). Uncompensated care burden did not increase significantly, while Medicaid revenue, Medicaid operating margins, and total operating margins improved in both hospital types in 2024. Conclusions While hospitals experienced increases in their uncompensated care costs following Medicaid unwinding, these increases coincided with rising Medicaid revenue.