A year from now, there won’t be more hospitals–there will be fewer, warned southern Arizona’s top healthcare executives.
A panel discussion this week painted a grim picture of the potential consequences of recent federal healthcare legislation. The CEOs from Banner University Medical Center, TMC Health, and El Rio Health addressed an audience of business leaders Tuesday, Oct. 28, hosted by the Chamber of Southern Arizona.
The speakers revealed that the One Big Beautiful Billl–which cuts approximately $1 trillion from federal healthcare programs–threatens to create a cascading economic and healthcare crisis.
"You cannot take a trillion dollars out of any system and expect that system not to change," said Clint Kuntz, President and CEO of El Rio Health. "We're taking a trillion dollars out of the system, not putting it in. So you're expecting things to break."
For every $1 billion cut, there is an estimated loss of 36,000 jobs across multiple industries in Arizona, according to a report commissioned by the Arizona Chamber Foundation, which also predicted:
- $1.7 billion in reduced labor income.
- A $3.7 billion contraction in overall economic activity.
- A $138.1 million decline in state and local tax revenues.
But the most immediate impact will be on Medicaid recipients, the panelists said.
Specifically, the bill introduces more frequent Medicaid redetermination–which will require recipients to reapply for eligibility every six months instead of annually–and reduces federal reimbursements.
Jennifer Mendrzycki is the president and CEO of TMC Health. She emphasized the strain on emergency departments, noting they've already seen unusual pressure. When people can’t afford preventative medical care, emergency visits increase, she said.
"We were on code purple more this past summer than we had been in several years prior."
Code purple is in effect for hospitals when there are more patients than beds.
Allison Flynn Gaffney from Banner University Medical Center stressed the broader economic implications.
"When businesses come to a community, they look for a couple of things... they want to make sure they have good schools... but they also want to make sure they have health care."
Republican U.S. Rep. Juan Ciscomani voted earlier this year in favor of the budget that will cut nearly $1 trillion from Medicaid over the course of a decade.
Before the vote, Ciscomani had signed a joint letter by the Congressional Hispanic Conference to U.S. Speaker of the House Mike Johnson sounding the alarm on the cuts to social services.
“Slashing Medicaid would have serious consequences, particularly in rural and predominantly Hispanic communities where hospitals and nursing homes are already struggling to keep their doors open,” the Feb. 10 letter said.
In June, Ciscomani urged Senate leaders to protect Medicaid in another letter. In July, the One Big Beautiful Bill Act was signed into law, including the Rural Health Transformation Program.
According to a Kaiser Family Foundation (KFF) report, the Rural Health Transformation was authorized by OBBBA to help offset the impact on rural areas of the law—which includes an estimated $911 billion in federal Medicaid spending reductions over the next ten years.
That includes an estimated $137 billion in rural areas based on KFF estimates—particularly given ongoing concerns about the financial vulnerability of many rural hospitals and reports of hospital closures.
“A year from now, there won't be more. There will be less,” Flynn Gaffney said of hospitals.
Kuntz criticized the bill, noting that the program is "not to replace loss of dollars" and is only for five years, with a focus on technology implementation.
‘Be very thoughtful’
The panelists were united in their call for action. "Talk to your elected officials," said Flynn Gaffney, a sentiment echoed by Kuntz and Mendrzycki.
"Encourage them to be very thoughtful about decision-making and truly understand the cascading impacts on the individual community members that they serve," said Flynn Gaffney.
The constituents of Arizona’s seventh Congressional district, however, were without representation as of Friday, Oct. 31,which marked the 38th day that U.S. House Speaker Mike Johnson refused to seat Democratic Representative-elect Adelita Grijalva.
Rep. Ciscomani, who represents the neighboring sixth Congressional district, told AZPM on Thursday, Oct. 30 that some of the urban hospitals in the region serve rural communities, and would be eligible for some of the $50 billion funds.
“This is why the shutdown right now is so detrimental to the progress we’re trying to make,” he said. “One of the things that is being tried to take away is the $50 billion fund. We can’t have that. We need to have that fund in place so that the hospitals can get what they need.”
Congressional Democrats counter that they are holding up government funding to pressure Republicans into extending billions of dollars in federal tax credits that have in recent years dramatically lowered premiums and contributed to record-low rates of uninsured Americans.
Healthcare is a unique problem, said Kuntz.
“We're going to have to solve this broadly and probably more at the federal level... We can't solve that locally."
