Sanford Health targets the coverage gaps driving uncompensated care growth
Sanford Health is leaning on a familiar but operationally demanding strategy: keep people insured before a missed renewal or administrative lapse turns into hospital debt. The Sioux Falls, South Dakota-based nonprofit system is expanding patient navigation programs and working closely with state officials to prevent coverage interruptions that feed uncompensated care costs.
The goal is straightforward. The execution is not.
When coverage falls away, the financial consequences move quickly through a health system’s balance sheet. Services already delivered still need to be paid for, but the reimbursement pathway has broken down, leaving the hospital to absorb the cost or chase payment from patients who may already be under financial stress. For a large nonprofit system, that pressure does not stay confined to the revenue cycle. It affects staffing plans, investment capacity, access strategy, and the ability to keep rural and community services open when margins are tight.
Bill Gassen, president and CEO of Sanford Health, is framing the issue as one that requires more than routine billing follow-up. Patient navigation in this setting is not a marketing concept or a convenience layer. It functions as a front-line insurance continuity tool, helping patients keep coverage active, understand what documents they need, and move through renewal or enrollment steps that can otherwise become a barrier to care. In practice, that can mean fewer avoidable uncompensated encounters, fewer retroactive coverage gaps, and fewer patients arriving at the point of service only to discover they have become uninsured.
Coverage continuity has become a revenue-cycle problem and a bedside problem
Coverage loss rarely begins in the hospital, but it often lands there. A patient may miss a renewal deadline, fail to complete paperwork, misunderstand eligibility rules, or encounter a state-level administrative hurdle that leaves them uninsured at exactly the wrong moment. Once that happens, the system must absorb the clinical reality of treatment while simultaneously managing the financial fallout.
For health systems with broad community reach, the burden is magnified by the volume of patients moving in and out of public and commercial coverage. The more unstable the coverage environment, the more likely a nonprofit provider is to see uncompensated care rise even when clinical demand is unchanged. Sanford’s response reflects an important strategic truth: preventing coverage loss is often more effective than trying to recover dollars after care has already been delivered.
Patient navigation also has a practical equity dimension. Coverage lapses are not distributed evenly. They tend to cluster among patients who face language barriers, transportation problems, unstable employment, changing household income, or limited familiarity with insurance processes. A navigation program can help close those gaps by making insurance maintenance part of the care continuum rather than an afterthought.
State coordination matters when administrative churn drives insurance loss
Sanford Health’s effort to work closely with state officials suggests a broader recognition that uncompensated care is not only a hospital finance issue. It is also a policy issue shaped by eligibility rules, enrollment systems, and the pace at which coverage changes are processed. When state agencies and health systems communicate effectively, it becomes easier to identify friction points before they translate into uninsured visits.
This is especially relevant for nonprofit systems that operate across wide geographies and serve patients who may move between coverage categories. Administrative churn can be as damaging as a true loss of eligibility. A patient who should remain insured but falls through the cracks still shows up as uncompensated care, even though the underlying problem is procedural rather than clinical.
Sanford’s approach points toward a more integrated model of financial protection around medical care. Instead of treating insurance status as a static intake question, the system is approaching it as an ongoing clinical and administrative risk. That shift matters because insurance instability can disrupt preventive care, delay diagnosis, and drive patients toward emergency settings where costs are higher and outcomes can worsen.
Nonprofit systems are being forced to treat reimbursement leakage as a strategic threat
Rising uncompensated care costs place unusual strain on nonprofit providers because they are expected to preserve access while absorbing more financial risk than commercial entities. A health system cannot simply stop serving uninsured patients without abandoning its mission, yet continued growth in unpaid care can erode the resources needed to sustain that mission.
The response Sanford Health is pursuing is rooted in prevention rather than collection. That is a revealing choice. Once a bill has moved into bad debt or charity-care territory, the organization has already lost ground. Reducing coverage lapses upstream is cheaper, more humane, and more operationally durable than trying to recover payment after the fact.
There is also a broader industry signal here. Health systems are increasingly being pushed to build internal infrastructure that resembles insurance assistance, eligibility counseling, and policy advocacy. Those functions used to sit at the margins of hospital operations. Now they are central to financial stability.
Sanford Health’s focus on patient navigation and state collaboration shows how uncompensated care is being addressed at the source: the moment insurance coverage becomes vulnerable. The remaining question for every system pursuing this model is how much administrative burden can be absorbed by navigation teams before the underlying policy churn overwhelms their reach.