The Financial Effects of Medicaid Cuts on US Burn Care

The federal government recently passed legislation that will significantly reduce Medicaid spending through work requirements. Burns disproportionately affect the Medicaid population and are one of the most costly injuries with some admissions incurring multimillion dollar hospital stays. All admissions with a primary burn diagnosis were extracted from the National Inpatient Sample, 2017-2022. Cost-to-charge ratios were applied and adjusted for inflation to 2025 US dollars. Facilities were stratified by burn center and safety-net status. Reductions in Medicaid enrollment were modeled using US Congressional Budget Office estimates. Projections of burn care and burn center losses over a 6-year period with 95% confidence intervals (CIs) were derived from Monte Carlo simulations using bootstrap resampling distributions. Of 178,545 weighted burn encounters, 39,575 under 18 years old were excluded as children will not be affected by the new law. The frequency of burn encounters covered by Medicaid has increased by 7.0% over the past 6 years. The total annual cost of burn care is estimated at $3,190,265,497, 28.4% of which is costs to Medicaid. Burn center costs to Medicaid increased by 18.9% over the past 6 years. Assuming the current trajectory of inpatient admissions, the overall reduction in Medicaid payments from burn care is estimated at $525,645,056-$717,992,704. 33.1% of Medicaid encounters were treated at safety-net hospitals, which will incur a 2.70% reduction in burn center funding. Non-safety-net hospitals will incur a 2.39% reduction. Revenue-generating strategies and cost containment may be insufficient for financial solvency in some burn centers.