As the uninsured rate rises, hospitals deal with more bad debt

More adults are going without health insurance, and hospitals are feeling it.

After falling during the pandemic, the uninsured rate among adults is on its way up again: About 11.2% of US adults 19 to 64 were uninsured in 2026, up from 8.9% in 2024, according to an Oct. 22 biennial survey from health research nonprofit the Commonwealth Fund. Some other adults experienced a coverage gap at some point in the year (12%) or were underinsured (23%), meaning they had insurance but didn’t have coverage for affordable care.

This report points to Medicaid and Affordable Care Act (ACA) enrollment drops as one cause. Additional coverage losses are expected in 2027 when changes from the 2025 One Big Beautiful Bill (OBBB) Act, such as Medicaid work requirements, take effect. As uninsured and underinsured rates rise, medical debt has challenged hospital finances, and companies may respond by selling to private equity (PE) or passing on costs to health plans and patients, experts told Healthcare Brew.

“Hospitals and health systems are taking a number of proactive steps as they see a rise in uninsured patients and uncompensated care…Even with these actions, rising levels of uncompensated care and other negative impacts from OBBBA may threaten hospitals’ ability to provide full access to care in their communities,” Aaron Wesolowski, VP of policy at the American Hospital Association, told Healthcare Brew over email.

White House spokesperson Allison Schuster pointed us to 2025 Census data that shows the uninsured rate decreased by 0.1% from 8% in 2024 to 7.9% in 2025. Unlike Commonwealth’s study, this figure represents the rate across all age groups. Census data for working-age adults however, suggests 11% of adults ages 19 to 64 were uninsured in 2024 and that percentage was unchanged in 2025.

Hospitals’ next moves. Management consulting firm Kaufman Hall’s National Hospital Flash Report for August found the cost of bad debt and charity care per calendar day was up 15% year-to-date in 2026 compared to 2025. Hospital operating margins were down 2% from 2024 to 2025 over the same period.

Hospitals typically have low margins, so “even small changes” in payer mix can impact their bottom line, Erik Swanson, report author and a managing director at Kaufman Hall, told Healthcare Brew over email.

In order to reduce costs, hospitals can shift patients to lower-cost sites of care, like outpatient settings. Hospitals may also invest in community health programs to help prioritize prevention and increase efforts to identify patients who are eligible for financial assistance or charity care, Swanson added.

John August, program director of Cornell University’s Industrial and Labor Relations School, told Healthcare Brew over email he thinks financial strain could also accelerate consolidation or PE acquisitions of hospitals.

In 1970, about 90% of hospitals were independent, but in 2019, only 32% were, according to a January report from the Bipartisan Policy Center, a nonprofit think tank. Consolidation and PE fans argue this helps hospitals experiencing financial distress, but some research suggests hospitals are more likely to lose assets after a PE-involved acquisition. Data suggests prices also go up for health plans and patients after consolidation or acquisition.

The context. The increase in uninsured adults in the Commonwealth analysis corresponded with a decline in respondents who reported having ACA marketplace coverage, other individual insurance coverage, and/or Medicaid coverage.

More than 25 million people lost Medicaid coverage when the government resumed member eligibility determinations in April 2023 after a three-year pause, according to an Oct. 2025 study in JAMA Health Forum.

ACA marketplace plan enrollment was nearly 3 million people lower in February 2026 compared to February 2025, according to Department of Health and Human Services (HHS) data released in June. HHS attributes the decrease in individual coverage to a crackdown on suspected fraudulent enrollments, though it happened alongside the expiration of ACA enhanced premium tax credits and a spike in premiums.

During an Oct. 27 earnings call, Nashville, Tennessee-based HCA Healthcare’s EVP and CFO Mike Marks said the health system had seen an “almost one-for-one” increase in uninsured patients proportional to patients who lost ACA coverage. If those patients hadn’t lost ACA coverage, he estimated the system would have made $400 million more in adjusted EBITDA this quarter.

Sara Collins, Commonwealth report coauthor and senior scholar, told Healthcare Brew she expects high medical costs and coverage losses will further strain the healthcare system unless the federal government enacts reform. The report recommends actions such as a law eliminating commercial plan deductibles and enforcing hospital financial assistance requirements.

“The current way that we provide insurance coverage, mostly through private plans—both employer plans and then also through the marketplaces—is simply not giving people the cost protection that they need,” Collins said.