Medicaid Cuts: A Looming Crisis for Rural Hospitals and Communities

As the Senate prepares to vote on its reconciliation bill next week, the next few days are critical for reaching out to senators and urging them to make changes to the current package. The proposed Medicaid cuts could have far-reaching negative consequences for patients, communities, and hospitals across America. The Senate Committee on Finance released its portion of the bill, which, while similar to the House-passed One Big Beautiful Bill Act (H.R. 1), contains provisions that would likely lead to more coverage losses and reduced access to care and services.

The magnitude of Medicaid reductions and changes to health insurance marketplaces will shift millions of Americans from insured to uninsured status. Additionally, the Senate’s proposal further erodes the legitimate use of provider taxes and state-directed payment programs that help bridge the gap of chronic and historic Medicaid underpayments. These cuts will further strain emergency departments as they become the family doctor to millions of newly uninsured people. Everyone in your community will be affected by these cuts, not just Medicaid beneficiaries.

Across the country, we’ll see longer wait times for care and services. And some hospitals, especially those in rural communities, may be forced to close altogether. The potential long-term economic and social impacts on rural communities if hospitals, particularly those in rural areas, are forced to close due to the proposed Medicaid cuts are significant and multifaceted. Hospitals in rural areas are often the backbone of the local economy, providing jobs and supporting local businesses. The closure of these hospitals would result in job losses and a decrease in economic activity, further exacerbating the financial hardship of the community.

The loss of healthcare services would disproportionately affect low-income rural populations, who may already face barriers to accessing care. The study published in the Annals of Internal Medicine estimated that the proposed Medicaid cuts could cause nearly 2 million people to lose their primary doctor, 1.3 million people to not fill medications they need, and 380,270 women to skip a mammogram. More than 16,600 people could die as a result of losing access to or forgoing care. This highlights the severe health consequences that could arise from the closure of rural hospitals, including increased mortality rates and a higher prevalence of chronic diseases.

Furthermore, the loss of Medicaid coverage for Medicare beneficiaries, particularly dual-eligible individuals, would substantially increase out-of-pocket costs for low-income Medicare beneficiaries. This could make their Medicare coverage unaffordable, leading to further financial strain and potential health complications. The Congressional Budget Office (CBO) estimates that the bill would reduce federal Medicaid spending by $793 billion over ten years and 10.3 million fewer people would be enrolled in Medicaid in 2034, including 1.3 million people with Medicare. This loss of coverage would disproportionately impact rural communities, where access to alternative healthcare services is limited.

These consequences are real, but they are not inevitable. A number of House and Senate Republicans have expressed concern with portions of the package, including some who believe the Medicaid provisions go too far, so we can still influence the debate. That’s why your senators and representatives need to hear from you now about how these cuts will impact care for patients and communities.

Advocacy Day and Resources. On Tuesday, nearly 300 hospital and health system leaders participated in an AHA Advocacy Day briefing to get the latest from Capitol Hill before meeting with their lawmakers and staff. See Tuesday’s Action Alert for more details and key messages. We continue to release resources to help you tell your story to lawmakers. This week, we issued an analysis showing that key Medicaid provisions in H.R. 1 would result in a $50.4 billion reduction in federal Medicaid spending on rural hospitals over 10 years and 1.8 million individuals in rural communities losing their Medicaid coverage by 2034.

We also are highlighting a video series in which hospital and health system leaders, including nurses and other caregivers, share the importance of Medicaid and how cuts would impact access to care for their patients and communities. At the same time, the Coalition to Strengthen America’s Healthcare, of which the AHA is a founding member, is running ads on TV, podcasts, radio, newsletters and other digital platforms targeted at key senators and influencers. A new Coalition ad is up and running this week, highlighting the impact Medicaid cuts would have on all patients, including fewer services, crowded emergency departments, longer wait times and hospital closures. The Coalition also is ramping up its grassroots advocacy efforts and has generated more than 400,000 letters to Congress about the importance of Medicaid.

Add Your Voice. While we continue to provide the air cover, it’s so important for you to share with your senators and representatives — as the bill will have to come back to the House for consideration — the negative consequences some of the proposals would have on the patients and communities you serve. It’s been said that “If you're not telling your story, somebody is telling it for you.” We must continue to tell our stories — as many times as necessary — because the health of millions of Americans is at stake.

Nothing is more powerful with lawmakers than your voice — and the voices of your team members, trustees, patients and community members. You live, work and, most importantly, vote in their states and districts. Lawmakers must hear directly from you the impact policy proposals would have for their constituents and your ability to provide care. Please add your voice today. Speak up and be heard as we urge Congress to protect access to hospital care.