Published on: March 31, 2026 at 4:27 pm
By Nick Keppler
President Donald Trump’s tax and spending plan, passed in July 2025 in the One Big Beautiful Bill, will cut about $1 trillion from Medicaid over the course of ten years, mostly by making eligibility requirements more stringent and limiting how states can fund their own programs. According to the Congressional Budget Office, this will cause nearly 12 million people to lose their health insurance.
Also at risk are rural hospitals and nursing homes, which disproportionately rely on patients’ Medicaid coverage to pay for their care. Researchers from the Cecil G. Sheps Center for Health Services Research estimated that more than 300 rural hospitals could close or reduce services as a result of the healthcare cuts in Trump’s mega-bill on tax and spending that Republicans in the U.S. Senate and House of Representatives narrowly passed.
Academy of Management Scholar Christoper Myers of Johns Hopkins University, who studies organizational practices and management in hospitals, said that these institutions will face some hard decisions.
“If you’re not being reimbursed from Medicaid for these procedures, that is a huge loss of revenue for these hospitals and would lead them to make corresponding cost-cutting decisions,” Myers said. “That might mean focusing only on particular service lines or procedure areas where the cuts have not been as severe or starting to limit what population of patients they see.”
To bolster their financial sustainability and insulate themselves from the effects of Medicaid cuts, some private clinics and urgent-care facilities may select an option that most healthcare providers would dread, Myers said: Limiting access to patients with private insurance, meaning that they would start turning away uninsured patients and even those with Medicare or Medicaid.
Management will be one factor in how well these hospitals will cope.
“If you’re if you’re operating on thin margins, like so many of these rural hospitals are, a cut is going to be hard no matter what,” Myers said. “But the whole idea of management is trying to figure out ways to either sustain your practices or adapt them given the resource set that you have.”
There are options managers can pursue to reduce the impact of the cuts, Myers said.
They could invest more in reducing readmissions, preventing errors or mix-ups, and emphasizing preventative care, all to limit the number of patient visits for which they will not be paid or will be paid less.
“When things get tighter and you need to think very carefully about efficiencies, about effectiveness, then I think management does start to matter quite a bit,” Myers said.
