By Marley Parish of Spotlight PA State College |
As federal Medicaid cuts loomed over Pennsylvania’s rural hospitals, health advocates focused on safeguarding funding for these already strained facilities and programs that help keep their doors open during this year’s state budget talks.
The $50.1 billion state budget — passed by the legislature and signed by Democratic Gov. Josh Shapiro after a four-month impasse — maintains support for rural and critical access hospitals. It preserves spending on programs that have faced cuts and closures in rural areas. And it increases state Medicaid spending as the feds prepare to cut roughly $1 trillion in funding over the next decade because of the so-called “big, beautiful” budget bill.
While stakeholders are pleased with the state’s final deal, it only offers some relief for rural Pennsylvania, where hospitals operate on thin margins and Medicaid helps keep the lights on. Advocates — now focused on next year’s budget — are hoping Pennsylvania can secure a piece of a new $50 billion federal program to address longstanding challenges to accessing care in rural communities.
The Hospital and Healthsystem Association of Pennsylvania (HAP), which represents more than 235 hospitals statewide, welcomed the preservation of past funding — such as $7.9 million for critical access hospitals and $10.6 million for obstetric and neonatal services — president and CEO Nicole Stallings told Spotlight PA.
The budget includes $10 million in one-time payments to rural hospitals, which will draw a $25.1 million federal match. Financially distressed hospitals will also receive $13.5 million, and while those dollars aren’t exclusively earmarked for rural facilities, Stallings expects they’ll still benefit.
Lisa Davis, director of the Pennsylvania Office of Rural Health, said the boost for Medical Assistance, or Medicaid programs — a more than $775 million increase collectively — is “really needed” amid an expected increase in uninsured patients and uncompensated care due to the federal cuts.
“No state in the country can really adequately fill those losses, but I think being able to have this increased funding for Medicaid is good,” Davis told Spotlight PA.