There is no relief in sight so far for the anticipated widespread loss of rural hospitals in the U.S., given the known threat from the new Trump Big Ugly Bill (BUB), which mandates cutting Medicaid outlays over the next 10 years, which is what many rural hospitals depend on, as well as hospitals serving poor urban areas. Secretary of Health and Human Services Robert F. Kennedy, Jr. said in Texas last month, that concerned hospitals should apply to the HHS for some special funds by December. He said that whether they qualify to receive help will depend on whether their state legislators enact MAHA-friendly laws getting rid of food dyes, sugary drinks in schools, and so on.
Rural hospitals have already been in trouble, even before this year. From 2017 to 2021, rural hospitals accounted for 71% in the decline of community hospitals—75 out of 105—even though rural hospitals are only 35% of the total number of community hospitals, numbering in the range of 5,000, according to the American Hospital Association’s Fast Facts on U.S. Hospitals, 2025. This trend will only increase with the implementation of BUB.
It is estimated that there are 338 rural hospitals in extreme risk of shutdown or serious reduction in services, once the BUB Medicaid cuts start to take effect in 2026. This number of extreme at-risk hospitals is arrived at by counting those hospitals that have experienced three consecutive years of negative growth margin, and those that are in the top 10% of Medicaid payer mix of rural hospitals across the country, These hospitals face being forced to curtail services, convert to clinics, or close down entirely, according to the review by the American Hospital Association.
