Hundreds of U.S. Hospitals at Risk of Shutting Down From Medicaid Cuts

Key TakeawaysNearly 450 hospitals are at risk of shutting down due to Medicaid cutsRoughly $1 trillion in funding is expected to be cutServices like mental health and maternal care could be affected.WEDNESDAY, April 1, 2026 (HealthDay News) — A new analysis from Public Citizen found that 446 hospitals are at high risk of closing or cutting services due to planned Medicaid cuts under President Donald Trump.The report looked at financial data from about 95% of U.S. hospitals between 2022 and 2024.Medicaid plays a major role in hospital funding, covering about one-fifth of all hospital spending, according to the health policy organization KFF.Hospitals were considered at risk if at least 20% of their revenue comes from Medicaid and other low-income government programs and they have been losing money in recent years.The cuts in Trump’s "big, beautiful bill" are expected to reduce federal Medicaid funding by about $1 trillion over the next decade.“We’re seeing hospitals that are already under severe financial strain having to make decisions about how to stay financially solvent,” the report’s author, Eileen O’Grady, a researcher in Public Citizen’s Congress Watch division, told NBC News.“That has pretty clear implications for people who live in that community," O’Grady added. "It also has ripple effects on other hospitals in those communities.”If hospitals close or reduce services, patients may have fewer options for care.“They have to travel further or wait longer in other hospitals that become overcrowded," Gideon Lukens, director of research and data analysis on the health policy team at the Center on Budget and Policy Priorities, a nonpartisan research group, explained."That additional time can be the difference between success and failure of time-sensitive, potentially life-saving treatments,” he added.Hospitals under serious strain may also have fewer staff members and less time for patients.“It can be very dangerous for hospitals to be under this kind of strain,” O’Grady said.Some hospitals have already warned they may cut services or lay off staff.Areas that could be affected include: Mental health services, maternal care and treatment for chronic diseases.For a lot of communities, especially those in rural areas, hospitals may be the only place to get that care.“I don’t think the impact is going to be a positive one,” James Jackson, the CEO of Alameda Health System in Oakland, California, told NBC News.“We are often the provider of last recourse, so if we’re not able to provide a service, there will be a delay in receiving care at one of the other systems in the area or they may not provide it at all,” he added.At-risk hospitals were found in 44 states and Washington, D.C.About 60% (or 267 hospitals) are in urban areas, even though rural hospitals may get hit the hardest.The largest numbers of at-risk hospitals are in California, New York, Illinois and Washington, all blue states.Experts say the cuts could hit Black and Latino communities the hardest.Alameda Health System said the cuts could lead to more than $100 million in losses a year by 2030, in addition to nearly 300 layoffs.A Michigan-based system, Trinity Health, said it expects to lose $1.5 billion due to "recent and future government policy changes," and has already cut 10.5% of its billing staff, NBC News reported.A hospital it runs in Georgia, St. Mary’s Sacred Heart Hospital, has also closed its maternity unit.The Medicaid cuts will roll out over time, with major changes starting in 2027 and 2028.Experts say it’s still unclear exactly when hospitals may close.“Closure is the worst-case scenario, but it also doesn’t preclude hospitals from having to make really tough decisions about cutting services that might be essential to those communities but are just no longer financially viable,” O’Grady said.More informationThe Commonwealth Fund has more about the effects of federal Medicaid cuts on hospital systems.SOURCE: NBC News, March 31, 2026.What This Means For YouMedicaid cuts could make it harder to access care, especially in rural areas..Sign up for our weekly HealthDay newsletter

Hundreds of U.S. Hospitals at Risk of Shutting Down From Medicaid Cuts

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