According to Nicole Stallings, President and CEO of The Hospital and Healthsystem Association of Pennsylvania, “Proposed Medicaid cuts will put Pennsylvanians’ access to care in jeopardy, especially in rural areas, making our communities less healthy and economically competitive.” Combined, proposed federal Medicaid and Pennie cuts could jeopardize health coverage for over 570,000 Pennsylvanians, drive up health care costs, and put rural hospitals at risk of closure.

There is a growing fear that, if passed, proposed Medicaid cuts in Congressional Republicans’ budget bill would have devastating impacts on Pennsylvania’s health care system.

“The proposed changes to the Medicaid program would have grave consequences for health care across Pennsylvania, from hospitals to individuals in both urban and rural communities,” said Secretary of Health Dr. Debra Bogen. “When people do not have health insurance, they are forced to forego preventive care and rely on emergency care. This, in turn, leads not only to worse health outcomes, but also increases uncompensated health care services, increases insurance premiums, and increases health care costs for all Pennsylvanians – on top of contributing to overcrowded emergency rooms.” 

Currently, proposed changes to Medicaid could strip health coverage from more than 300,000 Pennsylvanians, drive up health care costs, and put rural hospitals out of business. 

But the impact of the current federal proposal doesn’t end there. The bill fails to extend enhanced premium tax credits available to Pennsylvanians who purchase health insurance through Pennie, Pennsylvania’s official health insurance marketplace. These tax credits have made coverage more affordable than ever, and if they expire on schedule at the end of this year, it will also risk health insurance for an additional 270,000 Pennsylvanians, adding to the risk to hospitals and an increase in rates of uninsured and/or uncompensated care.

The loss of Medicaid-funded health care services will likely result in:

-Increases in uncompensated care;

-Exacerbation of chronic conditions such as diabetes or heart conditions; and/or

-Delays in seeking care or treatment, leading to worsened conditions, advanced diagnoses, and higher costs over time.

Pennsylvania cannot backfill or absorb these additional costs, as the Medicaid cuts create an unprecedented and unfunded increase in administrative burden that will strain existing operations and divert resources from delivering services to Pennsylvanians. 

Medicaid cuts will also hurt county and local agencies responsible for eligibility and program support. Medicaid provides health coverage for approximately three million Pennsylvanians. During fiscal year 2024-25, the Commonwealth contributed more than $14 billion to the Medicaid program, which is matched by more than $30 billion in federal funds.