Data on Rural Hospitals

Payer Mix and Margins

This table shows the proportion of the hospital’s total services that are paid for by different payers and the extent to which the payments from those payers cover the hospital’s cost of delivering the services.

The Share of Patient Costs represents the estimated cost of the services to the patients insured by a particular type of payer divided by the total cost of services to all patients.

The Margins for Medicare and Medicaid represent the difference between the payments from those payers and the costs of the services delivered to the patients they insure. For example, if the margin for Medicare is -3%, it means Medicare paid 3% less than the cost of the services to the patients on Original Medicare.

For private payers, the Allowed Margin is the margin calculated using the “allowed amounts” for services under the hospital’s contract with each payer. The allowed amount includes the cost-sharing portion (i.e., deductibles, co-payments, and co-insurance) that the patients are required to pay. Since not all patients are able to pay the full cost-sharing they owe, Bad Debt shows the percentage of the cost the hospital does not receive due to these non-payments. (This also includes unpaid amounts for patients who have insurance but also qualify for charity care assistance.) The sum of the Allowed Private Margin and Bad Debt represents the hospital’s actual net margin on privately insured patients. For example, if the hospital has an Allowed Margin of +10% on privately insured patients and Bad Debt of -6%, then the actual profit on the patients is only 4%.

Additional details on the methodology are available in the Methodology section.