U.S. Senate passes bill cutting Medicaid, threatening rural hospitals
WASHINGTON, D.C., UNITED STATES — The United States Senate passed an ambitious health care bill by a narrow margin, which may deprive millions of Americans of Medicaid and threaten rural hospitals.
Significant budget reductions and increased work demands could effectively deprive vulnerable groups of the necessary care, providing drug companies with a substantial source of revenue.
Medicaid cuts risk insurance loss for millions
The bill passed in the Senate would cut healthcare spending by $1.1 trillion over the coming decade, with Medicaid suffering the most. The Congressional Budget Office (CBO) found that 11.8 million individuals would also lose their insurance by 2034, primarily through Medicaid.
Together with other policy changes, there is a prediction of up to 17 million people being uninsured, marking the most significant decrease in insured coverage in U.S. history.
A key driver is a new work requirement for Medicaid beneficiaries aged 19 to 64, projected to save $325 billion, but which disproportionately harms older adults.
A UC Berkeley Labor Center analysis found that employment declines after age 50 are often due to health issues, caregiving duties, or age discrimination, making compliance difficult. Rural residents, like seasonal workers, also face barriers, which can lead to coverage loss.
Rural hospitals face collapse as funding dries up
Medicaid cuts extend beyond coverage, threatening hospitals that rely on federal funding. The bill caps state taxes on medical providers—a critical revenue stream—resulting in a reduction of Medicaid spending by $375 billion.
The National Rural Health Association (NRHA) warns that over half of states could see a 20% drop in rural hospital funding, potentially forcing closures. Jennifer Mensik Kennedy, President of the American Nurses Association, predicts job losses and longer emergency response times in vulnerable areas.
“I get that they want to cut fraud, but taking a swipe across the top is not going to solve the issue,” Kennedy said.
Although the Senate added a $25 billion rural hospital fund, critics argue that it is insufficient. In the meantime, a win for pharmaceutical giants was considered the bill proposes exempting drugs treating multiple rare diseases from Medicare price negotiations, which would cost the American people $5 billion.
“Pharma lobbyists will stop at nothing to maintain industry profits, and when a majority of the Senate caves to their interests, it’s a reminder to Americans why they’re paying the highest drug prices in the world. Simply put: it’s because Congress allows it,” said Merith Basey, Executive Director of the drug pricing group Patients For Affordable Drugs Now.
Basey denounces this shift, which could deal a further blow to an already controversial healthcare overhaul that may impact the delivery of patient care going forward.
