Health
Safety-Net Hospitals Face an Uncertain Future With Planned Medicaid Cuts
Medicaid cuts in the massive new federal spending bill have left some so-called safety-net hospitals in limbo.
These facilities serve mostly Medicaid recipients and uninsured patients, and rely heavily on government reimbursements.
With funding at risk, hospitals are warning they might have to close — and leave communities without badly needed access to care.
Once Medicaid funding is cut, as many as 330,000 people in Illinois could be impacted, officials said. Advocates say low-income patients don’t have many options if they lose Medicaid coverage and or if their local hospital closes. People could end up not seeking preventative care and pushing off routine check-ups until their conditions become life-threatening emergencies.
Medicaid cuts would hit local hospitals like Mount Sinai Hospital hard; 70% of the hospital’s patients are on Medicaid. Dan Regan, Sinai’s communications vice president, said the cuts will be felt far beyond hospitals’ bottom lines and everyone will feel the effects.
“It’s going to impact everybody because people will still need some place to go,” Regan said. “When safety nets get pushed to the brink, the impact isn’t contained. It’s not just on the safety net; it spreads and this bill will really widen the gap between the people who have access to care and those who don’t. Those gaps are not going to just show up in hospital budgets; they’re going to show up in schools. They’re going to show up in the workplace.”
Loretto Hospital, based in Austin, serves predominantly Black and Brown communities on the city’s West Side. These communities are disproportionately impacted by health care access disparities. At Loretto, 83% of patients are on Medicaid.
Tesa Anewishki, Loretto’s CEO, said the lost federal funding means uncompensated care would go up and revenue sources would decrease. She said less money means making some tough decisions about which services to cut in order to keep doors open. Fewer services could make things worse for underserved communities on the South and West sides that already experience lower life expectancies. There is an 11-year life expectancy gap between Black and non-Black Chicagoans, according to the Chicago Department of Public Health.
“The death gap continues to grow in our communities,” Anewishki said. “That means individuals don’t have access to the care they need when they need it. Ultimately, they have to travel outside their community for care or they may opt not to seek care.”
Both Loretto and Sinai also provide charity care — which means forgiving the debt patients owe if they can’t pay for services, and taking on a higher cost burden than more well-resourced hospitals.
Anne Igoe, a vice president with SEIU Healthcare Illinois, said the state may have to step in to fill the gaps in what the federal government stops providing.
“The way these hospitals are funded is unsustainable,” Igoe said. “What we need to be doing is thinking of different sources of revenue. What we need to be doing is finding different ways for these services to be reimbursed.”
