Maine hospitals face $66M annual loss from Medicaid cuts, study says
FILE PHOTO
A new national study says Maine hospitals are at risk of $66 million in annual losses due to Medicaid cuts. The state’s largest hospital is Maine Medical Center in Portland, shown here.
Hospitals across the country are bracing for financial strain as the Trump administration’s budget reconciliation package, known as the "Big, Beautiful Bill," calls for reducing federal Medicaid funding by an estimated $911 billion over the next decade.
With Medicaid currently accounting for nearly one-fifth of all U.S. hospital care spending, the proposed cuts could deliver substantial blows to hospital systems nationwide, according to the Third Way, a Washington, D.C.-based think tank.
In Maine, that impact is projected to be severe. Third Way estimates the state’s hospitals will lose approximately $66.4 million per year in Medicaid revenue.
The hardest-hit facilities are expected to include Northern Light Eastern Maine Medical Center in Bangor, MaineGeneral Health in Augusta (formerly known as MaineGeneral Medical Center) and Maine Medical Center in Portland. (MaineGeneral and Maine Med are both part of the MaineHealth system.)
Rural health care systems in crisis
The outlook is especially dire for rural hospitals, many of which were already grappling with staffing shortages and financial instability due to their low-population service areas, even before the proposed cuts.
More than 700 rural hospitals nationwide are currently at risk of closure, the study reports. These facilities are often the only source of care for over 60 million Americans living in rural regions.
In Maine, the fragility of rural health care systems was evident in May when Northern Light Health’s Inland Hospital in Waterville shuttered its doors in the wake of monthly losses of $1 million to $1.5 million.
Rural hospitals in Maine play a critical role for residents who face transportation barriers, financial hardship, and health literacy challenges. Despite this, they face staggering fiscal pressure, providing more than $70 million in uncompensated care annually, according to a report published in April by the Maine Hospital Association.
Closures and restructuring
The Inland Hospital closure is just one example of how Maine’s health care institutions have been forced to cut costs amid financial headwinds from inflation and declining federal reimbursements. Those pressures are expected to grow under the proposed Medicaid cuts.
Last year, St. Mary’s Hospital in Lewiston, the city’s second-largest health care provider, closed its intensive care unit due to consistently low patient volume.
In April, MaineGeneral Health announced cost-saving efforts affecting 148 positions. Of those, 54 were vacant and remained unfilled, 60 employees were offered redeployment, 14 saw reduced hours, and 20 roles were eliminated entirely. The organization cited rising costs and low Medicaid reimbursements as key factors in the restructuring.
Also in April, MaineHealth Waldo Hospital in Belfast discontinued its labor and delivery services and relocated them to MaineHealth Pen Bay Hospital Family Birth Center in Rockport. Leadership pointed to low birth rates and chronic recruitment challenges in rural areas. They stated that continuing obstetrics services had become “unsustainable”.
Even before these changes, Maine’s hospital systems were on fragile footing, as documented in a recent report by the Maine Hospital Association.
Mainebiz web partners
Most Recent
Most Recent
0 Comments