07/22/2025
๐๐ก๐ ๐๐ข๐ฅ๐๐ง๐ญ ๐๐ซ๐ข๐ฌ๐ข๐ฌ ๐
๐๐๐ข๐ง๐ ๐๐ฎ๐ซ ๐๐ฎ๐ซ๐๐ฅ ๐๐จ๐ฌ๐ฉ๐ข๐ญ๐๐ฅ๐ฌ โ ๐๐ง๐ ๐๐ญ๐ฌ ๐๐๐๐ฉ๐๐ซ ๐๐ฆ๐ฉ๐๐๐ญ ๐จ๐ง ๐
๐๐ฆ๐ข๐ฅ๐ข๐๐ฌ ๐๐ง๐ ๐๐จ๐๐๐ฅ ๐๐จ๐ฏ๐๐ซ๐ง๐ฆ๐๐ง๐ญ๐ฌ
Our rural communities depend heavily on local hospitals for essential healthcare services, emergency care, and as vital economic anchors. Unfortunately, these institutions are facing unprecedented hardships, putting the health and well-being of countless residents at risk. New information reveals that the upcoming changes to Minnesota's Medicaid program, known as Medical Assistance, will have far-reaching and often overlooked consequences, particularly in districts like Minnesota's 7th and 8th Congressional Districts, represented by Congresswoman Michelle Fischbach and Congressman Pete Stauber, which have the highest enrollments in the program.
Beyond the immediate crisis of an anticipated 9 rural hospital closures, with an additional 14 expected by the time these changes fully take effect, two critical pieces have been largely overlooked:
Unreimbursed Administrative Burden on Counties: Counties across Minnesota will face a significant, unfunded mandate. They will not be reimbursed for the extensive new administrative paperwork required to process Medicaid renewals every single month. To compound this, counties will face penalties if they incorrectly approve or deny renewals, placing an immense strain on already stretched local government resources and potentially leading to delays in coverage for eligible individuals. This burden will directly impact county budgets and, by extension, local property taxpayers.
Monthly Renewal Requirements for Parents of Children on Medicaid: Despite the Children's Health Insurance Program (CHIP), which covers children, not changing in its availability, parents with children on Medical Assistance will now be required to complete monthly renewals based on their regular work income. This creates a significant administrative hurdle for working families, increasing the risk of procedural disenrollment and coverage gaps for children, even if they remain eligible. Such frequent reporting can be challenging to manage, especially for families with fluctuating incomes or demanding work schedules.
๐โ๐ ๐ต๐๐๐๐๐๐ ๐ถโ๐๐๐๐๐๐๐๐ ๐น๐๐๐๐๐ ๐
๐ข๐๐๐ ๐ป๐๐ ๐๐๐ก๐๐๐
These new administrative burdens exacerbate an already fragile situation. Rural hospitals often operate on razor-thin margins due to:
Declining Patient Volumes: Fewer residents and patients seeking care in urban centers mean rural hospitals struggle with low patient numbers, making it difficult to cover high fixed operating costs.
Workforce Shortages: Attracting and retaining healthcare professionals, especially specialists, is a persistent hurdle. Many rural areas are designated as Health Professional Shortage Areas.
Inadequate Reimbursement: Medicaid and Medicare payments often fall short of the actual cost of providing care, further squeezing already fragile budgets. Proposed cuts to Medicaid could exacerbate this issue, as rural hospitals often serve a higher proportion of Medicaid beneficiaries.
Aging Infrastructure and Technology: Limited access to capital makes it challenging for rural hospitals to invest in modern equipment and maintain up-to-date facilities and technology, including cybersecurity.
Regulatory Burdens: While necessary for quality care, regulatory compliance costs can be disproportionately higher for smaller rural facilities.
๐โ๐ ๐ผ๐๐๐๐๐ก ๐๐ ๐ถ๐๐๐ ๐ข๐๐๐
When a rural hospital closes, the effects ripple through the entire community:
Reduced Access to Care: Residents face significantly longer travel times for emergency care, routine appointments, and specialized services. This can lead to delayed treatment, worsening health outcomes, and increased mortality rates, particularly for time-sensitive conditions.
Higher Healthcare Costs: Research indicates that rural hospital closures lead to higher prices at nearby "surviving" hospitals, with commercial inpatient treatment costs increasing due to reduced market competition.
Economic Devastation: Hospitals are often among the largest employers in rural areas. A closure can result in job losses, increased unemployment, a decline in local tax revenue, and a ripple effect on other local businesses, making the community less attractive for living and investment.
Loss of Essential Services: Beyond emergency and inpatient care, closures often mean the loss of crucial services like obstetrics, primary care clinics, and diagnostic facilities.
๐๐๐๐ซ๐ง ๐๐จ๐ซ๐
To gain a deeper understanding of this critical issue and the specific challenges facing hospitals, counties, and families in our region, we encourage you to read the latest article from MinnPost:
https://www.minnpost.com/greater-minnesota/2025/07/seismic-medicaid-changes-will-be-rough-on-rural-hospitals/
We will continue to monitor this situation and explore ways our community can support our local healthcare providers and seek out sustainable solutions.
Essentia Health Sanford Health Minnesota Department of Human Services U.S. Department of Health and Human Services Minnesota Rural Health Association
Threats of losses of services and even closures of rural hospitals loom after Trump signs โbig, beautifulโ budget bill into law.
