Cuts to Medicaid leave rural hospitals across the nation at risk of closure. (Courtesy of Wikimedia Commons)

Rural hospitals across the nation are now at high risk of closure due new budget cuts to Medicaid — but it appears Washington County service providers are not on the chopping block, for now.

The federal “One Big Beautiful Bill Act,” signed July 4, is set to reduce Medicaid spending by roughly $1 trillion over the next decade, pushing rural hospitals that rely on this funding system toward the brink.

While no closures have been officially made since the bill’s passage, 338 hospitals, including four in Oregon, are at risk of shuttering due to financial struggles. 

Rural hospitals in Silverton, Seaside, Madras and Hermiston are at high risk of closure due to “Republican health care cuts,” according to Oregon Sens. Ron Wyden and Jeff Merkley in a June statement.

It is expected that this new law will lead to a rise in unpaid medical care that hospitals will now have to foot the bill for — leading rural hospitals to contemplate changing or eliminating certain services, delaying the purchasing of new equipment and laying off staff.

The Medicaid cuts are expected to disproportionately affect rural Americans, leaving many of those insured by Medicaid without a way to pay for the health care they need.

“Roughly 66 million Americans — 20% of the population — live in rural areas where Medicaid covers one in four adults and plays a large part in financing healthcare services,” according to the Kaiser Family Foundation.

And even outside of medical access and costs, the closure of rural hospitals can impact more than just patients.

“Rural hospitals are often the largest employers in rural communities, and when a rural hospital closes or scales back its services, communities are not only forced to grapple with losing access to health care, but also with job loss and the resulting financial insecurity,” Sens. Ron Wyden and Jeff Merkley said.

Not a new struggle

Though these new budget cuts raise alarms to many small communities and hospitals across the nation, rural hospitals have been struggling for years.

Over the past decade there has been a decline in critical services such as inpatient and obstetric — pregnancy, childbirth and postpartum — services. In 2024, rural hospitals saw a 16% decline in hospital-based obstetric care services, with Medicaid paying just 63 cents on the dollar for care provided to Medicare patients, according to the American Hospital Association. 

What Medicaid can’t cover in a patient’s fees, the hospital has to pay for.

Nearly half of rural hospitals across the U.S. operated at a loss in 2023, with over 90 hospitals unable to provide overnight patient care over the last decade or having to shutter entirely, according to the AHA.