Losing health care coverage

Dr. Janet Albers is sad that thousands of Springfield-area patients could lose Medicaid coverage and delay care because of Republican President Donald Trump’s “One Big, Beautiful Bill.”

Albers, a family physician, told Illinois Times that she saw many previously uninsured patients get screened for cancer and chronic health conditions, then obtain lifesaving treatment, after the expansion of Medicaid eligibility in Illinois in 2014 allowed more low income people to be covered by the program, which is jointly funded by the state and federal government. Because of the Affordable Care Act, 90% or more of the cost of the expansion has been covered by the federal government.

“Many were people who had not had care in a long time,” said Albers, chairperson of family and community medicine at Springfield’s Southern Illinois University School of Medicine. “What’s going to happen is that all of that ground we gained … we will end up losing.”

The bill’s almost $1 trillion in nationwide Medicaid cuts over a 10-year period, which won’t take effect until after Congress’ November 2026 midterm elections, are expected to cause unprecedented funding cuts in the Springfield area, including:

A $60 million annual negative impact for Springfield-based Memorial Health that is expected to grow to $100 million by 2030, according to Memorial CEO Mandy Eaton.

For perspective, the five-hospital, nonprofit health system’s entire 1.8% operating margin was $29.5 million in the fiscal year that ended in September 2024, based on $1.6 billion in revenues. The system, which employs almost 8,600 people and operates 500-bed Springfield Memorial Hospital as its flagship, laid off about 300 employees in 2023 to save an estimated $40 million annually related to skyrocketing staffing expenses during the COVID-19 pandemic.

A loss of up to 20% of Medicaid funding for Hospital Sisters Health System, according to system president and CEO Damond Boatwright. The nonprofit system, based in rural Springfield near Riverton, employs 12,000 people and operates nine hospitals in Illinois and four hospitals in Wisconsin. The hospitals include the system’s flagship, 442-bed HSHS St. John’s in Springfield, as well as HSHS St. Francis in Litchfield and HSHS St. Mary’s in Decatur.

St. John’s alone posted $133.5 million in Medicaid revenues in 2024, according to the Illinois Health Facilities and Services Review Board – losing 20% of that total would be $26.7 million. Across HSHS, 20% of total Medicaid revenue amounts to more than $59 million per year, according to the system’s consolidated financial statements. 

A $5 million to $10 million annual loss to SIU School of Medicine, where 25% of its patients are covered by Medicaid, according to dean and provost Dr. Jerry Kruse. The financial hit jumps to $16 million a year when including the Trump administration’s plans to reduce federal funding for overhead expenses in research grants, Kruse said. 

Between 330,000 and 700,000 Illinoisans are expected to lose Medicaid coverage because of the changes, according to various estimates, including from Manatt Health, which says about 11% of the state’s current Medicaid recipients would be cut off.

Illinois has 3.4 million Medicaid enrollees, representing one-quarter of the state’s population, including almost 54,000 Medicaid recipients in Sangamon County and about 2,400 in Menard County, 11,900 in Macoupin County, 10,200 in Morgan County, 9,300 in Christian County, 8,600 in Montgomery County and 7,500 in Logan County.

Providers anticipate reductions in staffing, services

The nonpartisan Congressional Budget Office says Trump’s bill, signed into law July 4, will add $3.4 trillion to federal deficits over the next 10 years, mostly by extending the 2017 tax cuts enacted during Trump’s first term that disproportionately benefit wealthy Americans.  

Republicans who have been willing to speak about the Medicaid cuts have said the law will reduce waste, fraud and abuse in Medicaid by requiring states to verify recipients’ eligibility at least twice a year – instead of annually – and by forcing able-bodied adults who are lazy to get jobs if they want to maintain coverage.

Critics of the legislation say Republicans’ claims are contradicted by studies and real-world experiences with work requirements in states. They say most Medicaid recipients who aren’t disabled are employed, and the increase in required paperwork for recipients to prove they are working to retain coverage won’t reduce waste and instead will cause many eligible people to be cut from the program, with few able to obtain or afford insurance elsewhere or through an employer.

These newly uninsured people will resort more often to hospital emergency rooms for care, according to critics, who say the cuts will shift more uncompensated care costs to the rates paid by people with private insurance. Critics said the cuts will lead to layoffs in the health care industry, service reductions and hospital closures that affect all patients.

 For Illinois hospitals and local health care providers, the law will interfere with their ability to employ people and provide services, according to A.J. Wilhelmi, president and chief executive officer of the Illinois Health and Hospital Association. 

“This could have a devastating impact on our hospitals’ ability to continue providing the full range of services, to continue to keep their workforces intact, and to continue providing incredibly important programs in their communities,” Wilhelmi said.

The nonpartisan health policy research group KFF says the loss of eligibility for Medicaid enrollees and changes that the law makes in the “provider taxes” and “state-directed payments” that boost Medicaid reimbursements in almost all states will mean a $34 billion to $57 billion total reduction in federal funds to Illinois over a 10-year period.

CBO says almost 17 million people nationwide could lose health coverage by 2034 because of the Medicaid changes, mandated changes in the way ACA marketplaces enroll people and the law’s failure to continue expanded ACA premium tax credits beyond 2025.

The expiration of the more generous tax credits is expected to increase premiums to ACA marketplace enrollees in 2026 by an average of 75%.

Democrats in Congress tried to get Republicans to agree to reverse some of the new law’s provisions in exchange for Democratic votes on a spending bill to avoid a potential Oct. 1 shutdown of the federal government. 

GOP focuses on tax savings

Hospitals and other health care providers across the country opposed the Medicaid cuts before and since passage of the legislation by the GOP-controlled Congress. All Democrats in the U.S. House and Senate voted against the bill, along with just five Republicans.

Republican lawmakers largely have focused on the tax savings and other parts of the law when explaining their votes. 

All three of Illinois’ Republican members of the U.S. House voted for the new law: Darin LaHood of Dunlap, Mary Miller of Hindsboro and Mike Bost of Murphysboro. They haven’t said much to health care providers and other opponents of the Medicaid cuts.

Miller and Bost didn’t respond to requests for comment for this story. LaHood’s spokesperson, Josh Perschall, said LaHood wasn’t available for an interview. A statement from LaHood said the “Big Beautiful Bill focused on strengthening the Medicaid program for future generations.”

“The program must be returned to its foundational purpose of providing benefits to the most vulnerable in our communities who truly need the support,” LaHood’s statement said. “The reforms to the program used a scalpel approach to remove fraudsters, illegal immigrants and able-bodied adults without children, who have taken advantage of the program.”

LaHood continued: “I remain committed to supporting rural hospitals, underserved communities and vulnerable populations across my district throughout this transition, as well as continuing to promote policies that lower health care costs and provide increased choice to patients.”

U.S. Rep. Nikki Budzinski, D-Springfield, said Republicans are unfairly stereotyping Medicaid enrollees, lack evidence of waste and don’t have proof that the law will make Medicaid more efficient.

“These health systems that I’ve talked to – they are operating on the slimmest of margins,” Budzinski said. “So there’s not this pork, this fat, in the Medicaid program in the state of Illinois. … It’s a false narrative.”

She pointed to a KFF analysis that showed only 8% of adults on Medicaid are not working, and the lack of work is because of retirement, inability to find work or for some other reason. 

Budzinski and rural hospital officials said the $50 billion assistance fund set up for rural hospitals in the law won’t be nearly enough to blunt the overall negative impact.

She called on voters to send a message to Trump and his allies in Congress in the midterm elections to roll back at least some of the cuts.

Some of the most impacted areas of Illinois will be in rural areas represented by the three GOP members of the U.S. House, according to Tracy Warner, executive director of the Princeton-based Illinois Critical Access Hospital Network.

Voters in those areas may not realize how the Medicaid cuts will affect their communities until hospital downsizing and closures take place, she said.

Unless Congress acts, voters will feel the first blow when they see drastic premium increases on the ACA marketplace for 2026 coverage when the open enrollment period begins Nov. 1, 2025, she said.

Kruse, the SIU School of Medicine dean, said he is puzzled by Republicans’ silence and the GOP’s justification for the cuts. “It is a phenomenon that is beyond me,” he said.

Boatwright, the HSHS CEO, said he still has hope, perhaps naively, “that we may find a bipartisan approach in the near future to try to stave off some of these cuts. I don’t see a lot of receptivity to date to do that, because I think many people, many legislators who voted for this, I don’t think they’re convinced that this may have the impact that is currently being projected.”

Area hospitals brace for cuts

Under the current law, Boatwright said, “Hospitals will be forced to make difficult decisions to just maintain their viability. And that includes reducing or eliminating service lines, especially those that are not self-sustaining. … And ultimately, these cuts will impact access to care, especially in our rural and underserved communities.”

HSHS posted a net loss of $330 million in the fiscal year ending in June 2024 based on $2.6 billion in total operating revenues, representing a -13.7% margin. Official results for the fiscal year that ended in June 2025 haven’t been released yet, but HSHS spokesperson Kelly Barbeau said the system is projected to be “near break-even” because of “focused financial stewardship, operational improvements and growth in several areas.”

The improvement in finances for HSHS may be substantial compared with previous years, but Barbeau said the situation reinforces Boatwright’s statements about the “potential severe impact the Medicaid cuts will have on hospitals across Illinois and the country that also operate within narrow margins, or at a loss, but still have to keep their doors open to serve their communities.”

Eaton, the Memorial Health CEO, said Springfield Memorial Hospital is the only provider of inpatient psychiatric beds in a 60-mile region, and Jacksonville Memorial is one of the few remaining rural hospitals providing obstetrical services. Those psychiatric and OB services cost the system $15 million a year in unreimbursed costs, but Eaton said, “We’ll continue to find ways to fund that because that’s important to our mission.”

Eaton said Memorial isn’t at risk of closing its rural hospitals in Jacksonville, Taylorville and Lincoln. But overall, she said, “These cuts are going to impact our colleagues, and they’re going to impact our workforce.”

She, like Boatwright, wouldn’t be more specific when it comes to potential service reductions. 

Blessing Health System, which operates 25-bed Illini Community Hospital in Pittsfield and 329-bed Blessing Hospital in Quincy, told Illinois’ two U.S. senators, Dick Durbin and Tammy Duckworth, in an Aug. 21 letter that the financial loss to the system from the cuts will be $13.5 million annually. Blessing Hospital’s share of the loss will be $12.8 million, while Illini Community’s share will be $716,000. 

The system also operates a physician group and a network of rural health clinics serving west-central Illinois, northeast Missouri and southeast Iowa.

The cuts’ overall negative financial impact to the local economy will be $18.2 million a year for the Quincy area and $1.2 million a year for the Pittsfield area, the letter said.

System officials said Blessing Hospital’s operating margin, currently at 0.4%, will drop to -1.9% in 2028 and -2.8% in 2034. Illini Community’s operating margin, currently at 15%, will drop to 13.4% in 2028 and 6.7% in 2034, officials wrote.

The estimated 19% cut to Medicaid funding would make both Blessing Health System hospitals “dramatically limit capital spending, which would impact quality of services and facilities. A reduction in force would also likely be imposed. … Ultimately, we would not be able to offer the same level of service.”

Like Eaton and Boatwright, the CEOs of Memorial Health and HSHS, Trina Casner, president and CEO of Pana Community Hospital in Pana, said she and her top managers are taking part in internal discussions about how they will deal with the cuts but aren’t disclosing specifics yet.

Casner said she doesn’t want to upset Pana Community’s employees until she learns more details from the federal government and sees the legislation’s impact on Medicaid eligibility in real time.

Pana Community, a 20-bed hospital, serves a community of 5,200 people in Christian County, population 32,000. And with 312 workers, the hospital is Pana’s largest employer.

The “Big Beautiful” law will result in a $1 million annual loss of Medicaid funding for the hospital and change its 0.4% positive operating margin into a 1.5% operating loss, Casner said.

Over time, she said, the law will force the 111-year-old hospital to eat into its reserves, reduce services and probably cause it to close within eight to 10 years. Closure could come sooner than that if patients see few reasons not to drive to bigger communities such as Springfield or Decatur for care, she said.

Casner said she has invited Mary Miller, whose 15th Congressional District includes Pana, to tour the Pana hospital since Miller was elected in 2020 so Miller can see how the facility serves her constituents.

Miller hasn’t followed up, but Casner said the invitation remains open.  

Dean Olsen is a senior staff writer with Illinois Times. He can be reached at dolsen@illinoistimes.com, 217-679-7810 or www.x.DeanOlsenIT.

This article appears in October 2-8, 2025.