JAMESTOWN, N.D. -- The recent session of the North Dakota Legislature made only minor changes to the Medicaid expansion which is a good thing for the viability of rural hospitals, according to Mike Delfs, president and CEO of Jamestown Regional Medical Center.
"The expansion brings stability to the financial conditions of the hospitals," he said. "It allows care in other areas that aren't profitable enough to stand on their own."
The Medicaid expansion increases the number of people who qualify for Medicaid.
"The standard Medicaid is for people at or below the poverty level," said Beverly Fiferlick, chief financial officer at JRMC. "The expansion raises the limit allowing additional people. Some at no cost, some have a cost share."
Not all states have adopted the Medicaid expansion program.
"States that have waived the expansion usually have a lot of medical bad debt," Delfs' said.
Health care costs for these people just above the poverty line and without the protection of expanded Medicaid sometimes result in their bankruptcy and creates bad debts that the hospitals are unable to collect. The federal government funds 90% of the program while 10% of the cost is paid by the state.
"Nobody even breaks even on Medicaid reimbursement," Delfs said, referring to the reimbursement rate for the hospitals, "but the expansion helps the hospital avoid bad debts."
Avoiding bad debt is crucial for rural hospitals, many of which are already struggling, Delfs said.
A May study by the Center for Healthcare Quality and Payment Reform estimates that 15 rural hospitals making up 41% of the rural hospitals in North Dakota were at a high risk of closing. The report did not list which North Dakota hospitals were at risk, although Delfs said JRMC was not among them.
The study said Minnesota had 30% of its rural hospitals are at risk of closing while South Dakota had 22% and Wisconsin 21%.
North Dakota's 41% of rural hospitals in danger is close to the 40% of rural hospitals in the United States at risk. The vast distances in North Dakota make keeping rural hospitals operating important because if they fail, patients can have 100-mile or more trips for medical care, Delfs said.
That can lead to patients not seeking necessary health care because of the cost and time associated with getting to a hospital, he said.
The expansion program has also helped to improve the health of people who qualify, Fiferlick said.
"Medicaid expansion has changed the health care habits for some to include more preventative care," she said. "If we were to eliminate the Medicaid expansion, it would affect the health of North Dakotans."
For the hospitals, it is still a matter of the bottom line. Losing the Medicaid expansion would cost JRMC, for example, an estimated $600,000 per year or the equivalent of 12 full-time employees, Delf said. The hospital could also be forced to reduce equipment updates or programs if the expansion program goes away.
The recent North Dakota Legislature retained the program as it had previously existed "for all intents and purposes," Delfs said. Delfs said he hoped that the program would stay in place and allow future health care discussions with the Legislature to concentrate on other topics.
"This is easier to talk about now that the legislative session is over and we have time to converse," he said. "The next session, I hope we sit down to have a conversation about how we can provide better health care in the state."
JRMC is a 25-bed critical access hospital with 350 employees and daily operating expenses of about $158,000, Delfs said.