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Small Town Hospitals Eye Medicaid Expansion

February 26, 2013, 6:52 PM by Erich Schaffhauser

Small Town Hospitals Eye Medicaid Expansion

We still don't know whether legislators in Pierre will expand Medicaid, but small hospital administrators are watching.  If legislators pass such a bill, nearly 50,000 additional South Dakotans would be eligible for the government-paid health insurance.

The hospital in Faulkton operates with a small profit margin. Administrator Jay Jahnig can list several others that do the same.

"I've worked for 13 hospitals in eight states and virtually every one of the hospitals operates on a very slim margin. Uncompensated care takes a huge bite out of almost every hospital I've ever worked in," Jahnig said.

That's why Jahnig wants to see more insured people. When patients can't pay their bills, the hospital absorbs some of the costs.

"You have to make up the rest by charging your private pay patients, your privately insured patients more. Good, bad or different; that's the system we operate in," Jahnig said.

As state lawmakers heard public testimony last week, several argued Medicaid expansion would help fix those problems. Others said solutions lie in the free market, not the government.

Regardless of how it happens, Jahnig argues more insured people would allow rural hospitals to operate in a more secure environment.

"Absolutely, we need solutions to these problems," Jahnig said.

The Faulkton Area Medical Center relies on other factors to survive including support from its small town. Administration hopes a future with fewer unpaid bills helps the facility move forward as well.

The hospital budgets for charity care each year. It has very little room to go over that budgeted amount.

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