Medicaid Cuts Threaten Hundreds of U.S. Hospitals Serving Nearly 7 Million Patients

A Public Citizen analysis finds that more than 400 hospitals across 44 states and Washington, D.C. are at high risk of closing or cutting services due to Medicaid cuts in President Donald Trump's bill, which is expected to reduce federal Medicaid funding by roughly $1 trillion over the next decade. The 446 at-risk hospitals collectively serve approximately 7 million patients, with 60% located in urban areas and the highest concentrations in California, New York, Illinois, and Washington. Facilities like Alameda Health System in Oakland, which derives 60% of its revenue from Medicaid, have already announced layoffs of nearly 300 employees and projected losses exceeding $100 million annually by 2030. The cuts are expected to disproportionately affect Black and Latino populations and could force hospitals to eliminate critical services including maternity and mental health care, while rural areas face a net loss of $87 billion despite $50 billion in targeted support.

Scale and Geographic Distribution of At-Risk Hospitals

• ▪About 60% of the at-risk hospitals identified by Public Citizen — 267 facilities — are in urban areas
• ▪The states with the largest number of at-risk hospitals are California, New York, Illinois and Washington
• ▪Public Citizen defined at-risk hospitals as those in which Medicaid and other low-income government programs made up at least 20% of revenue and that have been operating at a loss in recent years
• ▪The Public Citizen analysis identified a total of 446 at-risk hospitals, with at least one at-risk hospital in 44 states and Washington, D.C.
• ▪Senate Republicans who backed the Medicaid cuts represent 146 at-risk hospitals in their states
• ▪House Republicans who voted for the Medicaid cuts have 196 at-risk hospitals in their districts
• ▪More than 400 hospitals across the United States are at high risk of closing or cutting services because of Medicaid cuts in President Donald Trump's bill, according to a Public Citizen analysis
• ▪The Public Citizen analysis draws on hospital financial data from the Centers for Medicare and Medicaid Services from 2022 through 2024, covering about 95% of U.S. hospitals

Financial Impact on Hospital Systems and Service Cuts

• ▪Trinity Health is projected to lose $1.5 billion due to recent and future government policy changes
• ▪Alameda Health System announced in December that it would lay off nearly 300 employees and lose more than $100 million annually by 2030
• ▪St. Mary's Sacred Heart Hospital in rural northeast Georgia announced last October it was closing its maternity unit
• ▪The Medicaid cuts come in phases, with more significant changes including work requirements in 2027 and limits on how states raise funds in 2028
• ▪President Donald Trump's law could reduce federal Medicaid spending in rural areas by about $137 billion over a decade
• ▪President Donald Trump's Medicaid law is expected to reduce federal Medicaid funding by roughly $1 trillion over the next decade
• ▪Alameda Health System in Oakland, California gets 60% of its revenue from Medicaid payments
• ▪Trinity Health laid off 10.5% of its billing staff in January

Patient Access and Community Health Consequences

• ▪James Jackson is the CEO of Alameda Health System in Oakland, California
• ▪Eileen O'Grady is a researcher in Public Citizen's Congress Watch division and the author of the hospital at-risk report

Perspective of At-risk hospitals

• ▪Hospitals across the United States have warned they may need to lay off staff members or scale back care, including maternity and mental health care, because of Medicaid cuts

Perspective of Trump administration and Congressional Republicans

• ▪President Donald Trump's Medicaid law sets aside $50 billion to support rural communities