Opinion Piece - Al Cross: Medicaid Benefits Everyone; Anticipate Harm
The recently passed federal healthcare bill, known as the "One Big Beautiful Bill," is set to significantly impact Medicaid and rural hospitals in Kentucky. The legislation, which includes work requirements and funding changes, is causing concern among hospital groups, health advocates, and state legislators.
**Impact on Medicaid**
The bill introduces work requirements for Medicaid-covered adults earning between 100% and 138% of the Federal Poverty Level. This means many Kentuckians may face new administrative hurdles or risk losing coverage if they do not meet these requirements.
Cost-sharing measures, such as copays up to $35 per service starting in 2028, are also introduced. Research shows that such measures tend to reduce healthcare utilization, potentially worsening health outcomes.
The bill cuts over $1 trillion from Medicaid nationally over ten years, including a $38 billion federal cut to Kentucky’s Medicaid program. It also changes retroactive eligibility for Medicaid, reducing coverage for some individuals. Furthermore, the federal share of Medicaid funding is reduced by limiting how much of Kentucky’s required state match can be met through provider taxes.
**Impact on Rural Hospitals in Kentucky**
The bill eliminates most of the existing provider tax scheme Kentucky has used to generate state matching funds for federal Medicaid dollars, a system that currently brings in about $1 billion a year for rural hospitals. This loss is expected to hit rural hospitals hardest, forcing many to cut services or even close.
Although a $50 billion fund was added by the Senate to help hospitals, providing an estimated $100 million a year for Kentucky hospitals, this falls far short of offsetting the $1 billion rural hospitals currently receive through the provider tax scheme. The reduction in Medicaid beneficiaries due to work requirement enforcement will also decrease hospital revenues because fewer patients qualify for coverage.
Hospital groups like the Kentucky Hospital Association have withdrawn support from the bill due to these funding changes, warning that without the provider tax scheme, hospitals would operate at a negative margin.
**Overall Implications**
The bill is expected to cause a large increase in uninsured Kentuckians (estimated at around 180,000 people losing coverage). It shifts significant costs and burdens to the state level, which may be hard for Kentucky to cover without substantial new investments.
Advocates say the bill will worsen health outcomes, increase hardship, and strain rural healthcare infrastructure. Hospital groups and health advocates warn that this legislation will compromise the ability of Medicaid patients to access necessary care and threaten the financial viability of rural hospitals in Kentucky.
As the bill's implementation approaches, there is concern about who will lobby for the poor and whether legislators will listen. The work requirement in the bill, overseen by 2nd District Rep. Brett Guthrie of Bowling Green, is the most-cited reason that the bill would lead to the closure of many rural hospitals.
Rural hospitals in Kentucky are getting $1 billion a year from the current provider-tax scheme, and $100 million is not enough to replace it. Some senators have referred to this funding scheme as "money laundering." The bill wipes out most of a funding scheme that the legislature has used to help Kentucky hospitals by raising provider taxes and using the money as a state match for federal funds.
The House passed the revised bill under deadline pressure from President Trump. Approximately one-third of Kentuckians are covered by Medicaid, a federal-state insurance program for low-income Americans.
[1] Source: [Link to the report] [2] Source: [Link to the Senate bill] [3] Source: [Link to the Congressional Budget Office report] [4] Source: [Link to the Kentucky Hospital Association's statement] [5] Source: [Link to the Kentucky Medicaid report]
- The recently passed "One Big Beautiful Bill" has introduced work requirements for Medicaid-covered adults earning between 100% and 138% of the Federal Poverty Level in Kentucky, potentially causing many Kentuckians to face administrative hurdles or risk losing coverage.
- The legislation has also introduced cost-sharing measures, such as copays up to $35 per service starting in 2028, which may reduce healthcare utilization and worsen health outcomes.
- The bill is expected to cause a significant reduction in Medicaid funding for Kentucky, with a potential loss of over $1 billion a year for rural hospitals from the elimination of the provider tax scheme.
- As the bill's implementation approaches, advocates and hospital groups have expressed concerns about the impact on the health and wellness of Kentuckians, as well as the financial viability of rural hospitals in the state.
- The bill's changes to Medicaid and rural healthcare funding have sparked debate in Kentucky's political landscape, with some legislators supporting the bill and others voicing opposition, citing potential negative impacts on the state's general news and health-and-wellness sectors.
