Shifting patients from Medicaid coverage to self-pay could lop off 0.4% to 1.4% of hospital net revenue, or about $25 billion annually

Medicaid disenrollments expected under the One Big Beautiful Bill Act (OBBBA) signed into law in July could wipe out more than 70% of an average hospital’s net income, according to proprietary data and analysis by Kodiak Solutions.

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Kodiak Solutions modeled four scenarios for Medicaid enrollment declines from policy changes required by the One Big Beautiful Bill Act and their impact on the average hospital's finances. The most severe scenario would see the average hospital operating margin decline by more than 70%.

Estimates of the OBBBA’s impact on the number of beneficiaries who would lose Medicaid range from 7.8 million people, according to a Congressional Budget Office estimate (PDF), to nearly 15 million. Kodiak Solutions estimates that hospitals could lose from 0.4% to 1.4% of net revenue as a result, or up to $25 billion in net revenue nationwide in one year alone.

To help health system finance leaders understand the impact of the OBBBA on their finances, Kodiak Solutions modeled the impact of four disenrollment scenarios, running the numbers for declines of 5%, 10%, 15% and 20% of Medicaid patients, respectively. The scenarios assume that those patients would become self-pay patients, with hospitals collecting from those patients less than 40% of what Medicaid would have paid. Kodiak Solutions analysts used a 2% operating margin for a hospital with $278.3 million in net revenue before any OBBBA-driven changes.

The data come from more than 2,100 hospitals and 300,000 physicians that use the Kodiak Revenue Cycle Analytics platform to manage their net revenue and monitor their revenue cycle performance.

“The numbers are simply jaw-dropping for health system finance leaders trying to plan for the future and ensure their hospitals and medical practices can continue to serve their communities,” said Matt Szaflarski, Vice President, Revenue Cycle Intelligence for Kodiak Solutions. “Hospital leaders need to start making changes today to prepare for the potential impact of these changes.”

The scenarios and other details from the analysis are available in the August 2025 Kodiak RCA Benchmarking Analysis.

Kodiak Solutions recommends three actions for hospital leaders to take:

• Renew efforts to help patients qualify for and retain Medicaid eligibility
• Expand preventive care programs for uninsured patients to help them stay healthy and avoid costly, complex care later
• Look to reduce operating costs wherever possible

To learn more about the data and insights Kodiak Solutions can provide to benchmark your revenue cycle performance, contact Szaflarski at (463) 270-8123.

About Kodiak Solutions

Kodiak Solutions is a leading technology and tech-enabled services company that simplifies complex business problems for healthcare provider organizations. For nearly two decades as a part of Crowe LLP, Kodiak created and developed our proprietary net revenue reporting solution, Revenue Cycle Analytics. Kodiak also provides a broad suite of software and services in support of CFOs looking for solutions in financial reporting, reimbursement, revenue cycle, risk and compliance, and unclaimed property. Kodiak’s 450 employees engage with more than 2,100 hospitals and 300,000 practice-based physicians, across all 50 states, and serve as the unclaimed property outsourcing provider of choice for more than 2,000 companies. To learn more, visit our website.

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“The numbers are simply jaw-dropping for health system finance leaders trying to plan for the future and ensure their hospitals and medical practices can continue to serve their communities.” -- Matt Szaflarski, Vice President, Kodiak Solutions.