‘Tomorrow Is Not Guaranteed’: Medicaid Cuts Worry Kansas Hospitals and Nursing Homes

By AJ Dome, KLC Journal

Even as the pressure piles on, Diana Thompson is not going to abandon her job.

A lifelong resident of Comanche County in south-central Kansas, Thompson has worked as the administrator for Pioneer Lodge nursing home in Coldwater since 2003.

She bets that most of the 1,600-plus county residents do not fully understand the challenges she faces to meet the daily needs of her 25 residents.

“I’m going to say a majority of the community is not aware that tomorrow is not guaranteed at Pioneer Lodge,” she says.

Thinly spread finances are her biggest stressors. The recently passed One Big Beautiful Bill Act isn’t alleviating any of her concerns.

The budget document signed by President Donald Trump on July 4 will, over a 10-year period, cut $1.2 trillion from Medicaid and the Supplemental Nutrition Assistance Program, according to the Associated Press. Medicaid, known as KanCare in the state, provides health coverage to more than 366,000 Kansans, including low-income families and children, seniors and people with disabilities. More than 185,000 Kansans receive SNAP food benefits.

Because of the pay-as-you-go rule that’s designed to restrain deficit spending, without further Congressional action, Medicare will also see reduced spending by up to $490 billion nationwide in the coming decade. The health program covers 588,000 Kansans over 65 as well as younger people with qualifying disabilities, and pays for 43% of statewide hospital stays, according to the Kansas Hospital Association.

Reps. Ron Estes, Derek Schmidt, and Tracey Mann, all Republicans, voted in favor of the bill. Rep. Sharice Davids, a Democrat, did not. Davids says the bill would harm Kansans by taking away their health care and food benefits. Estes and Mann both say the bill will help middle-class families by lowering taxes and enhancing border security and the agricultural industry.

Sen. Jerry Moran voted for the budget bill after changes to rural health services by the Senate. A $50 billion Rural Health Transformation Program was written into the bill to provide emergency assistance to rural hospitals facing immediate financial challenges that will be aggravated by further cuts. In a news release, Moran said he was able to add the provision to the bill to protect Kansas hospitals. Kansas’ junior senator, Roger Marshall, also voted for the bill.

In the run up to the bill’s passage, the Trump administration pushed back against analyses, including ones from the Congressional Budget Office. It contends the bill won’t result in American families being kicked off Medicaid, cuts to Medicare or the closure of rural hospitals.

“The One Big Beautiful Bill protects and strengthens Medicaid for those who rely on it — pregnant women, children, seniors, people with disabilities, and low-income families — while eliminating waste, fraud, and abuse,” an article on the White House website states. “The One Big Beautiful Bill removes illegal aliens, enforces work requirements, and protects Medicaid for the truly vulnerable.

While it’s true the legislation didn’t change eligibility requirements, it will save money by cutting enrollment. That is projected to increase the number of Americans who don’t have health insurance by several million people.

According to a report produced by Manatt Health, based in Los Angeles, in partnership with the REACH Healthcare Foundation of Overland Park and the United Methodist Health Ministry Fund of Hutchinson, Medicaid cuts will result in lost coverage leading to more uncompensated care, more emergency room visits and more overall pressure on individual providers.

Manatt analysts indicate about 13,000 Kansans would lose Medicaid eligibility. Health policy research firm KFF estimates 23,000 to 36,000 Kansans could potentially lose their coverage. Further projections from Manatt and the Health Ministry Fund show a loss of $3.897 billion in federal and state Medicaid dollars in the coming decade.

Smaller communities like Coldwater, about 125 miles southwest of Wichita, may be more acutely affected because federal support to hospitals and nursing homes, such as Pioneer Lodge, has been so vital. Thousands of Kansans could also lose access to mental health support services because of budget cuts.

Thompson worries about the future of Pioneer Lodge. While the rest of Comanche County may not see the full picture, she and her volunteer board members are “very much aware” of how thin the razor’s edge truly is.

OPERATING IN THE RED

Thompson says it’s already a struggle to break even financially. Her monthly expenses for April and May averaged about $200,000, including labor costs, food, utilities, insurance and supplies. Federal Medicaid reimbursements paid for most of that.

Across the Kansas health care spectrum, Medicaid covered $0.65 on every dollar of care provided to program recipients in 2023, per the Hospital Association. Medicare covers slightly more, at $0.69 on every dollar of care spent. The difference between Medicaid payments and overall care costs in 2023 was $264 million.

Thompson has heard from other nursing home administrators who are terrified of how the proposed cuts might impact their facilities. According to the hospital association, nearly 65% of all nursing home residents in 2023 were covered by Medicaid. At Pioneer Lodge, 20 of Thompson’s 25 residents are Medicaid recipients. If that funding is lost, those 20 people – and thousands more – would not be able to afford their nursing home stay.

Kansas hospitals are also facing painful decisions about which services to halt or reduce in the face of Medicaid cutbacks.

Benjamin Anderson is the president and CEO of Hutchinson Regional Healthcare System, a hospital 50 miles northwest of Wichita serving an area with about 100,000 people. He says the 130-bed hospital is currently operating on a 1% profit margin. He’s not only worried about the impacts of Medicaid cuts on Kansas health care but also what that might mean for communities that rely on medical facilities as a major employer, such as Reno County.

“Our hospital is watching our cash right now so we can continue to make payroll,” Anderson says. “When you’re committed to caring for everyone, regardless of their ability to pay, you have 1 to 2% profit margins.”

According to David Jordan, president and CEO of the Methodist health ministry fund, 87% of hospitals in Kansas are losing money. Of the 122 community hospitals across the state, 26 are at immediate risk of closure, while 63 are at risk of closing within the 10-year life of the bill.

Eight hospitals have shuttered since 2010:

Central Kansas Medical Center in Great Bend
Mercy Hospital in Independence
Mercy Hospital in Fort Scott
Oswego Community Hospital
Horton Community Hospital
Sumner Community Hospital in Wellington
St. Luke’s Cushing Hospital in Leavenworth
Herington Hospital

The Methodist health ministry fund does not have a list of the 26 at-risk facilities. A document from the office of Sen. Edward Markey, a Massachusetts Democrat, that was sent to Trump last month lists the rural hospitals nationwide that are considered at-risk, or that have three consecutive years of losses. There are six such facilities in Kansas noted in the document, appearing in this order:

Centura Bob Wilson Memorial Hospital in Ulysses
University of Kansas Health Systems Campus in Great Bend
Kiowa County Memorial Hospital in Greensburg
Rush County Memorial Hospital in LaCrosse
Norton County Hospital in Norton
Smith County Memorial Hospital in Smith Center

Brenda Sharpe, CEO of the REACH Healthcare Foundation, says hospital officials are generally reluctant to reveal any solvency issues because of public perception.

“Some people may think, if they (the hospitals) are going broke, then they (the public) won’t use the hospital’s services,” she says. “I understand why they may be fearful, but I also wish they’d be more up-front about finances.”

Sharpe says hospitals will have to renegotiate with insurance companies to help recoup some lost federal dollars. This will likely lead to higher health insurance premiums, putting coverage out of reach for many Kansans. Those who are dropped by Medicaid and cannot afford other insurance programs through the federal Health Insurance Marketplace often wait until they are severely ill to visit an emergency room, typically the most expensive form of health care.

All of this means more people will potentially die early from preventable illnesses, says Sharpe, who grew up in Lane County, northeast of Garden City. She remembers getting good general medical care in Dighton and Garden City as a child, but today her family members regularly travel to Wichita, Kansas City or Denver for specialized services – a common practice for people living west of the Interstate 35 corridor and an indicator of reduced or nonexistent rural health care services.

More reductions in services are anticipated across rural and frontier areas of Kansas as the bill is implemented over the next few years. A report from Manatt and the National Rural Health Association estimates 5,000 rural Kansans could lose Medicaid coverage and rural hospitals would see a 15% reduction in Medicaid reimbursement, further straining patients and the facilities at risk of closing.

“If people really thought a little bit about who in their family or friends or neighbors have ever struggled with a chronic health condition, or are unable to work, or are disabled, or who’ve had a persistent mental illness,” Sharpe says, “then they would know someone who is really in jeopardy if they don’t have access to the health care they need.”

Cindy Samuelson is the senior vice president of member and public relations for the state’s hospital association. She says hospital administrators and boards of directors will have to work harder to inform their surrounding communities about any changes being made to local services.

“It’s more that hospitals will have to make tough decisions. It’s not so much about shutting their doors, but more so about which services will get cut,” Samuelson says. “I definitely know our hospitals are trying to continue to keep their care local for the Kansans they serve.”

Specialized care programs serving the fewest patients, including things such as in-home respite care and asthma clinics, will likely be the first chopped or consolidated as rural facilities try to compensate for lost revenue. Hospitals in the state stand to lose $2.65 billion in Medicaid dollars over the next 10 years, according to Jordan.

“Our hospitals cannot afford to absorb billions of dollars in Medicaid cuts without cutting services and or possibly closing their doors,” Jordan says.

Alex Haines, CEO of St. Luke’s Hospital and Living Center in Marion, about 60 miles north of Wichita, says he and his staff are incorporating reductions in their budget for the next fiscal year to try to counteract Medicaid cuts.

“What it causes us to do is pay really close attention to the service lines and payers we struggle with,” Haines says. “It’s a painful process.”

MORE LOCAL SUPPORT

One solution to avoiding service cuts and building closures may be the sale of rural hospitals and nursing homes to outside entities.

An example of that can be found in Herington, about 90 miles southwest of Topeka. Trent Skaggs is the CEO of Rural Hospital Group in Kansas City, Missouri. His company bought Herington Hospital this year with the intent of restoring local services. The municipal hospital was converted into a nonprofit facility in 2021 and then closed two years later. Rural Hospital Group owns four small facilities in Kansas with 25 or fewer beds, including Hillsboro Community Hospital in neighboring Marion County.

Skaggs, a former Missouri state legislator, says he’s working to finalize funding sources for the Herington purchase, and that city officials there are excited by the prospect. He believes communities will have to step up in the future to support smaller hospitals to compensate for the loss of federal dollars.

The Rural Health Transformation Program is anticipated to provide $10 billion increments over five years to aid at-risk hospitals. Kansas facilities are anticipated to receive $811 million to help, but it’s not enough to close the gap left by Medicaid cuts. Samuelson wrote in an email that the fund is slated to begin doling out payments next year, but it may not be able to cover all hospitals in need.

“Medicaid is more than just a health care program,” Samuelson wrote. “It’s an economic stabilizer, a rural lifeline and a safeguard for Kansas families.”

Samuelson agrees that more local funding sources will be necessary to prop up rural hospitals and nursing homes, and she hopes communities will advocate for their local providers by hosting conversations on how to close those gaps in finances and care.

Anderson was the administrator at Kearny County Hospital in southwest Kansas prior to joining the Hutchinson hospital in January 2024. He believes the best solutions to the most complex problems in health care “originate from the people who are closest to them.”

Haines says it’s tough for him and his colleagues to decide how and where to save money because it diverts from direct discussions about assisting patients.

“People go into our industry because they want to help people, especially vulnerable people,” he says. “It’s like an ongoing balancing act.”

In Coldwater, residents held fundraisers almost 20 years ago to pay for improvements to the now 60-year-old nursing home building. Jennifer Theurer, a Pioneer Lodge board member, says the community prides itself on showing up for others in need. Theurer knows Thompson, the administrator at the nursing home, and her staff will show up every day to care for their residents, regardless of any decisions made in Washington.

“If you’re concentrating on your village and their needs, and your needs, then I feel like that kind of helps to quiet the national noise,” Theurer says. “I feel like, the more good I put out into the universe, maybe that fights back against the bad stuff.”

Thompson feels fortunate to currently have some savings on hand, but she knows it wouldn’t last long in a crisis. Seemingly constant financial and policy-related roadblocks are making her job feel harder than usual.

Even though she has no real plans of leaving, Thompson jokes that the thought has crossed her mind.

“I have threatened to run a few times,” she says with a laugh, “but here I am.”

A native of southwest Kansas, AJ Dome has a background in radio news, TV production and newspaper reporting. He has reported as a correspondent for The Journal since 2023 and is based in Garden City.

This article first appeared on KLC Journal and is republished here under a Creative Commons Attribution-NoDerivatives 4.0 International License.

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Previously Published on The Journal with Creative Commons License

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