UROP Research Mentor Project Submission Portal: Submission #1035

Overall Research Project Description This study examines whether hospitals can financially benefit from a greater reliance on public insurance programs, specifically Medicaid and Medicare, by analyzing how the relationship between the proportion of Medicaid/Medicare reimbursement and hospital financial sustainability varies under different structural conditions. The independent variable is the Medicaid/Medicare payer mix, measured as the percentage of total revenue or discharges from these public insurers, and the dependent variable is hospital financial sustainability, captured through metrics such as operating margin, net income, or days cash on hand. Two key contextual moderators are considered: market competition, assessed using the Herfindahl-Hirschman Index (HHI), and geographic location, categorized as urban or rural. The first hypothesis (H1) examines whether a higher Medicaid/Medicare payer mix is positively associated with hospital financial sustainability. Building on this, H2a proposes that this positive association is stronger in markets with lower competition, while H2b suggests the relationship is more favorable for hospitals located in rural areas. By testing these interactions through a moderated regression model, the study challenges the prevailing view that public payer reliance undermines financial health and instead argues that, under the right structural conditions, hospitals can strategically benefit from serving more publicly insured patients—providing important insights for health system leaders and policymakers seeking sustainable and equitable healthcare delivery models.