Corporate health insurance is killing hospitals. Increasingly, people can’t afford it and go uninsured. Insurers deny, delay and downgrade reimbursements to hospitals. And, insured Americans can’t pay their out-of-pocket hospital costs, Laura Dyrda reports for Becker’s Hospital Review, Not surprisingly, hospitals in every region of the country are facing mounting bad debt and providing more charity care.
Bad debt and charity care are increasing quickly for hospitals. For sure, some of that results from an increasing number of Americans unable to afford insurance, since passage of the One Big Beautiful Bill. But, a lot of that stems from insurers not being willing or able to rein in costs and shifting costs to enrollees. Consequently, tens of millions of Americans are underinsured.
Smaller hospitals, in particular, are at risk of needing to shut their doors. Hospitals with 25 or fewer beds have witnessed an increase of bad debt and charity care of 51 percent. These tend to be critical access and rural hospitals.
That said, bad debt is hurting large academic and metropolitan hospitals as well. Those with 500 or more beds saw a 31 percent increase in bad debt and charity care over the last year. Prospects for a turnaround are not evident. In fact, cuts to Medicaid and ACA subsidies will likely only worsen the plight of America’s hospitals.
Across the US, one report found that bad debt and charity care rose 18 percent between March 2025 and March 2026. Since March 2023, it has grown 46 percent.
Different parts of the country have been affected at different rates. In the Midwest, bad debt and charity care rose 31 percent in the last year. And, in the first quarter of 2026, the Midwest saw a 24 percent increase in bad debt and charity care.
The South saw the slowest growth over the last three years, at 22 percent.
The Northeast and Mid-Atlantic recorded a 57% increase in bad debt and charity care over the last three years.
Here’s more from Just Care:
- Medicare Advantage endangers rural hospitals
- Hospitals speak out against corporate health insurance
- Poll: People with government health insurance more satisfied than people with corporate health insurance
- Medicare Advantage insurers are killing rural hospitals and communities
- Do you qualify for hospital charity care?
