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Opinion | Don’t be fooled, Michigan. Medicaid cuts will impact your care
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When hospitals close or cut vital services in the wake of Medicaid funding reductions, there is one very clear reason why those decisions will need to be made: Because the federal government just slashed the lifeblood of health-care delivery across the nation, Michigan included.
Sadly, the One Big Beautiful Bill Act includes more than $6 billion in annual Medicaid funding losses for Michigan health-care providers over the next decade. This is not a rounding error. This is not waste. This is money that directly supports hospitals, clinics and caregivers across the state. The loss in funding will result in real consequences for real people — including those who are commercially insured.
Across the country, politicians who voted for this bill are trying to defend their actions with a series of talking points influenced by saving political face over doing what’s best for the health of their communities.
Let me be clear: Hospitals are struggling because they are being forced to make impossible decisions in a system under siege.
In Michigan, Medicaid serves 2 in 5 children, 3 in 5 nursing home residents and more than 2.6 million Michiganders overall. Put simply: There’s a good chance you know people in your own life who rely on Medicaid.
Hospitals treat all patients, regardless of their health insurance coverage. Hospitals don’t operate with separate wings just for Medicaid patients. When you cut Medicaid, you cut off core funding that supports every patient who walks through a hospital’s doors. When that funding goes away, hospitals must reduce services, lay off staff or, in some cases, close altogether. It’s simply math.
In rural areas, the threat is even more acute. Many rural hospitals already operate on razor-thin margins and Medicaid reimbursement is critical to their financial viability. When these cuts are implemented, our hospitals will face a funding cliff that could result in ERs being shuttered, birthing units eliminated and cancer treatment centers disappearing — because Congress pulled the rug out from under them.
To suggest the new Rural Health Transformation Fund will help is a hollow promise. You can’t close a $6 billion annual gap with a temporary patchwork of grant funding and expect stability. Our hospitals need consistent, sustainable support, not one-time bailouts or empty reassurances.
Remember, these cuts will affect more than just Medicaid recipients. When hospitals lose Medicaid dollars, the burden shifts to other patients, including those with employer-sponsored insurance. Costs go up. Wait times increase. Local access to specialty care dries up. Employers and families alike will feel the ripple effects, both in their insurance premiums and at the distance they must travel for care.
In short, cuts to Medicaid hurt everyone. They destabilize a system that supports entire communities: employers, caregivers, patients and taxpayers alike.
Like any complex system, health-care faces challenges with administration, workforce and service delivery. Those challenges are ultimately the result of massive federal disinvestment.
Decisions to close or cut services are taken extremely seriously and are often made as a last resort. These are institutions that have served communities for generations. But when you take away core funding, reduce coverage for thousands of residents and increase uncompensated care across the board, there is simply no financial model that can make cuts of this magnitude work. No business, no matter how well managed, can operate without revenue.
Michigan’s hospitals and caregivers will continue to serve the millions of patients who rely on them every day for as long as they can financially. But let’s not confuse consequences with causes. This crisis is a failure of policy, not management.
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