Why It Matters
Washington hospitals anticipate losing nearly $6 billion in revenue through 2033 as Medicaid funding reductions take effect. Hospital leaders say the changes could increase uncompensated care, strain emergency departments and lead to staff reductions or clinic closures.
What Happened
A report from Washington’s hospital and community health associations projects steep financial losses for hospitals after congressional Republicans approved a tax-break and spending-cut law that reduces federal Medicaid funding.
Democratic U.S. Sen. Maria Cantwell and healthcare leaders discussed the projections Tuesday at Harborview Medical Center in Seattle. They said fewer people enrolled in Medicaid could turn to emergency rooms instead of primary care, leaving hospitals to provide more treatment without reimbursement.
Hospitals must treat patients in emergency departments regardless of whether payment is available. Cantwell said reducing uncompensated care helps control overall healthcare costs, while failing to do so increases costs for patients and other payers.
Republicans have argued that the funding reductions are needed to address waste, fraud and abuse in Medicaid. The changes include new work-reporting requirements and limits on coverage for some lawfully present immigrants.
About 200,000 Washington residents are projected to lose coverage by the end of next year. Officials expect roughly 600,000 enrollees to be subject to work requirements beginning Jan. 1. Those enrollees must document work, volunteering or class attendance, totaling at least 80 hours per month, every six months, unless they qualify for an exemption.
The requirements apply to healthy adults up to age 64 who do not have dependent children younger than 13. Separately, about 10,000 Washington residents lost Medicaid coverage Oct. 1 after the law removed eligibility for refugees, asylees and other lawfully present immigrants, including some people who fled Ukraine and trafficking victims.
Rural Hospital Impact
Rural hospitals are expected to face some of the largest effects. Hospitals in Washington’s 6th Congressional District on the Olympic Peninsula are projected to lose $1 billion, with the 2nd and 5th districts also listed among those facing significant losses.
Jefferson Healthcare in Port Townsend is preparing for millions of dollars in lost revenue and more than $1 million in additional uncompensated care. CEO Mike Glenn said rural facilities are considering layoffs, clinic closures and reductions in services.
“Small rural hospitals will be harmed disproportionately because rural communities tend to be older and poorer than urban communities, and more dependent on public payers like Medicare and Medicaid,” Glenn said.
By the Numbers
Nearly $6 billion — projected Washington hospital revenue loss through 2033
200,000 — Washington residents expected to lose coverage by the end of next year
600,000 — Washington Medicaid enrollees expected to face work requirements
80 hours per month — work, volunteering or class attendance required under the mandate
$339 million — projected annual Washington hospital revenue loss in 2027
$1 billion per year — projected hospital revenue loss in the 2030s
22.2% — average increase projected for Washington exchange coverage in 2027
Zoom Out
The Medicaid reductions are projected to total more than $900 billion nationwide over the next decade. The law also includes $50 billion for rural healthcare, and Washington is expected to receive hundreds of millions of dollars over five years for initiatives intended to strengthen health systems in less-populated areas.
Separately, tens of thousands of people have dropped Affordable Care Act plans after federal subsidies expired. Coverage through Washington’s exchange is projected to cost an average of 22.2% more in 2027.
What’s Next
Work requirements are scheduled to begin Jan. 1, with enrollees required to document eligibility every six months. Washington hospitals are expected to assess staffing, clinic operations and services as projected losses increase from $339 million in 2027 to $1 billion annually in the 2030s.