Medicaid is a critical source of health insurance coverage nationwide and an important source of support for the care that essential hospitals provide.
Essential hospitals serve a disproportionate share of Medicaid patients, but Medicaid payments often fall short of covering the full cost of care. As a result, essential hospitals rely on a patchwork of Medicaid supplemental payments that are jointly financed by states and the federal government according to longstanding financing rules.
This brief describes the role of Medicaid for essential hospitals and ways to promote high-quality, efficient, and innovative care for Medicaid beneficiaries.
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