A rural hospital in Kentucky is warning that it will no longer be able to maintain its current level of care due to the nearly $1 trillion in Medicaid cuts included in the One Big Beautiful Bill (OBBB).
In a recent interview with Tradeoffs, David Asher, an executive at Harrison Memorial Hospital, explained that small, independent hospitals like Harrison Memorial will have to make drastic funding and operational changes to account for OBBB’s Medicaid changes. Already, “Harrison Memorial must start looking now for ways to cut expenses by about $2 million a year, Asher said. With less Medicaid revenue, he added, ‘we’re going to have to really tighten down, see what services are making money, what services can survive.’”
Highlights from Asher’s interview with Dan Gorenstein and Melanie Evans are included below:
- “Hospitals will soon have a lot more patients who can’t afford medical care, based on estimates of the number of people who will soon lose health insurance under the newly enacted federal budget bill.”
- “Staying enrolled will get harder for those who are eligible. They’ll have more hoops to jump through, and those who falter will lose coverage. Yet, the uninsured still get sick and injured; many will end up with hospital bills they cannot pay.”
- “Under one program the Republican budget will be scaling back — a program that had raised Medicaid’s pay rates to health care providers — Kentucky hospitals are projected to lose $15.1 billion in revenue. Those higher rates ‘keep us in business,’ Asher said.”
- “States and hospitals will need to help low-income residents navigate through Medicaid’s red tape, Asher told us. … But hiring and training staff to help Kentucky residents meet Medicaid’s new paperwork demands will come with its own costs.”
- “Congress included $50 billion for rural health care relief in its new budget, but it’s unclear how that money will be handed out. Asher told Tradeoffs he hopes to see the funds tied to hospital quality, and directed to where health care is scarce. No matter how it’s awarded, he said, the fund isn’t big enough.”
- “The new Medicaid changes won’t go into effect until late 2027 or early 2028, but that doesn’t give rural hospitals much time to adapt. Harrison Memorial must start looking now for ways to cut expenses by about $2 million a year, Asher said. “With less Medicaid revenue, he added, ‘we’re going to have to really tighten down, see what services are making money, what services can survive.’”
Policymakers must take steps to protect rural Kentuckians – and patients across the country – from the consequences resulting from the unprecedented funding cuts to the Medicaid program. For more information on Medicaid’s vital role, visit https://modernmedicaid.org.