Definitive Healthcare calculates hospital payor mix using the Medicare Cost Report. This data gives insight into a facility's financial health and performance. Financial data like the payor mix can also identify which hospitals have excess budget. This budget could become medical supplies or new technologies. This includes imaging equipment, PPEs, surgical devices, and more.
Understanding hospital financial data can help segment a market and explain its pain points.
This material reviews payor mix data for over 5,800 hospitals and compares the results to previous years.
![]() MedicareClaims charges from beneficiaries who are 65 and older and part of the Medicare program |
![]() MedicaidClaims charges from beneficiaries who are part of state Medicaid programs. Also includes Medicaid Managed Care charges |
![]() Private/Self-Pay/OtherClaims charges from any patients who have private insurance, who do not have insurance or choose to self-pay, Medicare Advantage patients and all other patients |
Total revenue for both Medicaid and private/self-pay insurance increased from 2017 data. The percentage of the total payor mix from private/self-pay decreased from 67.9% last year while the Medicare percentage increased from 19.5%. This could be representative of the unemployment increases seen throughout 2020. Businesses need to cope with COVID-19 interruptions.
Additionally, the percentage of Medicare patient days decreased (43.3% in 2017) and increased for private/self-pay (48.4% in 2017).
The American population is aging and many state Medicaid programs expanded over the last several years. Trends for Medicare and Medicaid continue to show decreases in hospital patient days. The percentage of patient days covered by private/self-payors has increased from 42.1% in 2010 to 50.8% in 2018.
The percentage of payor days correlates to hospital bed count. The percentage of Medicare days declines and the percentage of private/self-pay days increases. This is relative to a hospital's number of beds. Facility specialties, insurance coverage, and hospital service area demographics likely a large role in these differences.
Like in previous data sets, the highest percentage of Medicaid and private/self-pay patient days are at psychiatric hospitals. The coverage of inpatient mental health services is a possible cause for some of these differences. Critical access, long-term acute, and rehabilitation hospitals report over half of their patient days coming from Medicare beneficiaries. This is likely tied to patient demographics.
Comparing the payor patient days by hospital region shows the Midwest has the highest percentage of Medicare days. Hospitals in the West have the least Medicare days and the most Medicaid days. Northeastern hospitals have more payor days from private/self-payors. Year-to-year changes reflect the national results of payor patient days.
This is representative of patient demographics. The Midwest likely reports greater Medicare days because it has a higher population of older Americans. The West likely reports higher Medicare days because of its higher volume of impoverished and underinsured patients.
Breaking down the percentage of patient days by state shows swings from the overall average. For example, the average Medicare patient days is over 58% in South Dakota, Nebraska, and Mississippi. These three states also have some of the lowest private/self-pay patient days.
The changes in percent of payor days year-to-year by state are outlined below. Kansas and Texas had the biggest decreases in percentage of Medicare patient days. Regarding patient days for private/self-pay at hospitals, Kansas and Ohio each had five percentage point increases according to 2017 and 2018 data.