More so than rural hospitals, urban safety net hospitals are most at risk of having to reduce services or even shutter as a result of impending Medicaid cuts, according to a new analysis by Harvard T.H. Chan School of Public Health.
The analysis was published online Nov. 17 by the School’s Healthcare Quality and Outcomes (HQO) Lab and was featured in a Nov. 18 New York Times article. It was conducted by the HGO lab team, including Jose Figueroa and Thomas Tsai, principal investigators of the lab and faculty in the Department of Health Policy and Management.
As part of the One Big Beautiful Bill Act (OBBBA), policymakers introduced a $50 billion fund to bolster rural hospitals because they feared that federal cuts to Medicaid would disproportionately hurt these facilities. The HQO Lab assessed how OBBBA may impact rural hospitals as well as urban ones using hospital demographic and budgetary data from the American Hospital Association Annual Survey, Medicare Healthcare Cost Report Information System, the Agency for Healthcare Research and Quality Compendium, and the Private Equity Stakeholder Project. More than 4,400 hospitals—a mix of urban and rural, with varying levels of financial stability and reliance on Medicaid—were included in the analysis.
Of these hospitals, the researchers identified 109 that face the biggest risk from impending Medicaid cuts, because they serve vulnerable communities, more than a quarter of their patients are covered by the program, and they already have financial challenges. The vast majority—85%—of these vulnerable hospitals are urban and are therefore ineligible for support from the rural hospital fund.
The impact on these hospitals and their patients—a significant share of whom are low-income and belong to racial minorities—will be “profound,” Tsai told The New York Times. “There will be an acceleration of hospital closures, or at least acquisitions with hospitals changing hands. And the worry I have is that patients are sort of left in the middle.”
The analysis’ findings don’t discount the risks rural hospitals face. They do, however, highlight the need to recognize, appreciate, and address the challenges urban hospitals also face, the authors say.
“Our analysis suggests that urban hospitals represent an underappreciated group that may be particularly vulnerable to OBBBA-related challenges,” they wrote. “Policymakers should explore opportunities to bolster financial support for hospitals that would be most affected. … With the future of health care at stake, hospitals caring for our most vulnerable patients need more, not less, federal and state support.”
Read the HQO analysis:
Medicaid Cuts Likely to Affect Urban Safety-Net Hospitals
Read the New York Times article:
When the G.O.P. Medicaid Cuts Arrive, These Hospitals Will Be Hit Hardest
Learn more:
How Medicaid cuts could lead to loss of coverage for millions (Harvard Chan School news)
Medicaid cuts: What’s at stake (Harvard Chan School news)
