Trump’s Big Beautiful Bill places Fresno County hospital under financial stress
AI-generated summary reviewed by our newsroom.
- Medicaid cuts in the Big Beautiful Bill may strain rural hospitals' finances.
- Adventist Health Reedley relies on Medi-Cal for 66% of net patient revenue.
- Experts list Reedley, Coalinga, and Los Banos hospitals at risk of Medicaid cut.
Could a Fresno County hospital be at risk of shutting down or reducing services under the Big Beautiful Bill?
Concerns began swirling after the Adventist Health hospital in Reedley was listed in a June 12 letter by democratic members of the U.S. Senate to the Trump Administration about the risk the Big Beautiful Bill would place on the nation’s rural hospitals.
The bill, which cuts nearly $1 trillion from Medicaid over a 10-year period, was signed by President Trump on July 4.
The cuts could result in fewer reimbursements for hospitals that rely on Medicaid funding.
“These changes carry significant implications for health systems across the country, particularly in rural and underserved areas like California’s Central Valley,” said Tim Haydock, Central California network operations executive for Adventist Health.
Haydock said Adventist Health is “carefully reviewing the legislation to fully understand how it will impact our 8 hospitals and 131 clinics in the Central Valley.”
According to the Senators’ letter, “the cuts will have devastating consequences for health outcome and costs, jobs and the economic success of rural communities.”
The letter states that rural hospitals are “uniquely at risk of financial distress and even closure, conversion, or service reductions because of the cuts.”
Haydock said while two of Adventist Health hospital were named in the letter — Adventist Health Reedley and Adventist Health Tehachapi — both hospitals “are not at risk of closure.”
According to an analysis by the Cecil G. Sheps Center for Health Services Research at the University of North Carolina at Chapel Hill, substantial cuts to Medicaid payments, also known as Medi-Cal in California, could increase the number of unprofitable rural hospitals and elevate their risk of financial distress.
Medi-Cal payments to Adventist Health in Reedley totaled $125.8 million, or 66%, of net patient revenue in fiscal year 2023, according to the California Health Care Foundation.
“We are closely monitoring how the U.S. Department of Health and Human Services and the State of California implement these changes,” Haydock said.
According to the Cecil G. Sheps Center, more than 300 rural hospitals nationwide could be at risk. In California, the center listed 28 rural hospitals that could be at risk based on serving a high share of Medicaid patients or experience negative total margins.
Hospitals at risk meet one of two financial criteria. The hospital is either in the top 10% Medicaid payer mix of rural hospitals across the country or has experienced three consecutive years of negative total margin.
Besides Adventist Health Reedley, other Central Valley hospitals that face a precarious financial situation include Regional Medical Center in Coalinga and Memorial Hospital in Los Banos.
Los Banos, Reedley and Coalinga hospitals are considered top Medicaid providers by the Cecil G Sheps Center analysis.
Memorial Hospital in Los Banos had $41.6 million in Medi-Cal payments, or 38% of net patient revenue, in fiscal year 2023 while Regional Medical Center in Coalinga had $15.5 million, or 38% of net patient revenue, according to the California Health Care Foundation.
Haydock said Adventist Health is committed to “protecting access to care for our most vulnerable populations.”
Nearly 15 million Californians are enrolled in Medicaid, according to UC Berkeley Labor Center. In Fresno County, 54% of the population are enrolled in Medi-Cal.
