Estimation of uncompensated care costs in a Texas county and Southwest border counties

Uncompensated care is part of the escalating healthcare spending crisis. Hospitals have been trying to balance their original missions' of caring for the poor and the infirmed while reducing healthcare expenditures and costs. With Medicare and Medicaid oversight, the ability of hospital administrators to utilize cost shifting to cover charity care has been significantly reduced. This reduction has increased the importance of administrators to correctly identify uncompensated care in order qualify for reimbursement programs offered at the federal and state levels.

With most uncompensated care reported in charges, the authors attempted to estimate the actual cost of uncompensated care in a Texas county. From reported uncompensated care charges of nearly one billion dollars, the authors estimated $353 million of healthcare costs for 2004. Of this more than half originated in charity care, while the remainder was attributed to bad-debt.

Since undocumented immigrants, have been blamed for the increasing burden uncompensated care places on hospital providers, we also examined national border counties of the Southwest. In these counties, the authors found undocumented immigrants accounted for 24% or $164 million of uncompensated healthcare costs in 2000. By state, uncompensated care costs ranged from $99 million for Arizona border counties to Texas border counties with $302 million. Additionally, Arizona led reimbursement for uncompensated care based upon illegal immigrant apprehensions at nearly $41 million followed by Texas at $22 million.

Given this information, the authors assert the importance of reporting costs of care to correctly identify long term solutions to uncompensated care.