The U.S. Congress voted to pass the One Big Beautiful Bill Act and it was signed by President Trump on July 4. This was not the outcome we wanted and we fought very hard to defeat the many harmful provisions in the bill.
The bill eliminates nearly $1 trillion from Medicaid and ACA marketplace funding over the next decade, which will impact nearly every American in one capacity or another.
Leading economist and non-patrician industry experts alike all agree that these deep reductions will limit health services, lead to significant delays in care, shut down essential services like OB and psychiatric care in rural communities, create longer wait times in emergency rooms, and ultimately overburden healthcare systems, leading to accelerated hospital closures across the country.
Let’s look at the bill’s provisions and what they mean for rural health.
- Work Requirements: Able-bodied adults will be required to report 80 hours of working, completing community service or participating in an educational program every month. While we certainly want to see able-bodied adults engaged in meaningful activity and contributing to the workforce, this monthly reporting adds a significant amount of red tape that will prevent many beneficiaries from staying on Medicaid due to technology and communication barriers.
- Eligibility Redeterminations: Typically, redeterminations are conducted annually and require all Medicaid beneficiaries to renew their enrollment. Under the new legislation, they will be conducted every six months starting at the end of 2026. We have worked with the Department of Health & Human Services to help beneficiaries stay on Medicaid though this process, but many don’t know about the redetermination or don’t know how to stay enrolled, especially in rural areas where access to proper technology and internet connection is limited.
- FMAP Reductions: The current incentive offered to states to expand their Medicaid programs helps them provide more reliable aid to beneficiaries and sustain rural hospitals with increased Federal Matching Assistant Percentage (FMAP). This incentive will sunset at the end of this year, meaning the states not currently participating in an expansion program will likely not be equipped to do so, and putting many expansion programs, and consequently hospitals, at risk.
- State Directed Payment Programs: Medicaid State Directed Payment Programs (DPPs) can pay providers up to average commercial rates (ACR), but starting in 2028, the payments will have a new cap based on Medicare payment rates, limiting vital funding for hospitals and healthcare organizations. The good news is that the DPP programs will be grandfathered to help rural hospitals survive the drastic change.
- Provider Taxes: Although Medicaid is a federally funded program, states are allowed to support their individual programs by taxing providers up to 6% their revenue. This has been the focus of our concern with the legislation because the bill reduces that allowable percentage to 3.5%. The cap will gradually decrease between 2028 and 2032 and is designed to prevent states from making up for the lost funding with other tax structures. Ultimately, the provider tax reduction will result in significant damage to hospitals by stripping the payments that currently support Medicaid expansion.’
If we want to maintain healthcare in rural communities across the country, we must not surrender the fight to protect Medicaid, even now that the bill has become public law. We must continue to lift up our collective voice to ensure that we protect, defend and serve the most vulnerable among us: the elderly, the widows, the less-advantaged and others who comprise our Medicaid population.
Rural health cannot be sacrificed like this. We must continue to work hard to serve our communities and defend essential programs like Medicaid that equip us to do so. Follow along with Hillsdale Hospital’s campaign on this page and on our podcast: Rural Health Today.
What can you do?
Raise your voice to help us express our concern with cuts to Medicaid. Here’s what you can do to make a difference…
Contact Your Representatives
Visit mha.org or ruralhealth.us to send a pre-written or custom message to your representatives. You can also find your legislator at fiscalnote.com/find-your-legislator and call or email to express your concerns.
Stay Up To Date
As with many legislative issues, we don’t always know when we will receive updates regarding Congressional action. We will update this dashboard as frequently as possible and continue to share resources and stories on our social media platforms. Staying up to date on the latest reports and news items equips us to address misconceptions surrounding Medicaid recipients and the damaging impact of cuts.
Share Your Story
If you have a story to tell about how Medicaid has assisted you or a loved one, we want to help you share that story. Submit the form below or reach out directly to Communications Manager Kyrsten Newlon at knewlon@hillsdalehospital.com.
