Underpayment by Medicare and Medicaid Fact Sheet, December 2017 Update

Underpayment by Medicare and Medicaid to U.S. hospitals was $68.8 billion in 2016. Medicare reimbursed 87 cents and Medicaid reimbursed 88 cents for every dollar hospitals spent caring for these patients. This fact sheet provides the definition of underpayment and technical information on how this figure is calculated on a cost basis for Medicare and Medicaid.