Compared to other care delivery organizations, safety net hospitals have particularly thin margins. The majority of patients they see are either altogether uninsured or on Medicare or Medicaid, which reimburses them at a much lower rate than commercial insurance plans.

Though fulfilling an immense need in the communities they serve, safety net hospitals rarely have much profit to show for their efforts. And when Covid-19 forced safety net hospitals to cancel elective procedures and make large purchases of personal protective equipment and other tools to treat patients presenting with the virus, that was the straw that broke the camel’s back. Due to the compounding social determinants of health impacting the members in their community, safety net hospitals often saw more patient volumes than that of hospitals treating Covid-19 patients with commercial insurance, but at the same time, had far fewer resources from which they could pull.

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