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Rochester, MN (KROC AM News) - A new report shows a significant drop in charity care among Minnesota hospitals last year.

The report from the Minnesota Department of Health highlights the changes in uncompensated care between 2013 and 2014, the first year in which Minnesota implemented many of the most significant coverage provisions of the Affordable Care Act, including the establishment of MNsure. The report says Minnesota hospitals experienced a drop of 6.3 percent in uncompensated care in 2014.

The department says uncompensated care has two components -  charity care and bad debt. While charity care is care that hospitals provide without expecting payment, bad debt is payment that hospitals expect but do not receive. The report says hospitals saw a 22.4 percent decline in charity care. Charity care fell for patients with insurance and patients without insurance. However, there was a greater decline in charity care for the uninsured (down 24.6 percent) compared to insured patients (down 17.8 percent).

Overall uncompensated care decreased because the drop in charity care was greater than the ongoing trend of increased bad debt among hospitals. However, in 2014, hospitals saw bad debt increase 9.3 percent ($14.9 million) to $174.2 million. Bad debt has been steadily trending upward in Minnesota with few interruptions. The increase in bad debt has occurred as health care costs continue to rise and employers and insurers shift more of the costs to patients through higher deductibles and copays.

Hennepin County Medical Center was the largest provider of uncompensated care followed by the two Mayo hospitals.

" We are pleased that more Minnesotans now have the benefits of health coverage when they go to the hospital,” said Minnesota Commissioner of Health Dr. Ed Ehlinger. “However, the rising cost of health care continues to pose a threat to access to care. Without addressing health care costs through additional reforms and prevention efforts, even those patients with insurance increasingly are struggling with medical bills and unpaid care or bad debt.”

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