James Kaiser, CEO of Holy Cross Hospital in Taos, told the committee the hospital and other rural providers face an acute financial challenge if Medicaid funding is cut at the federal level or if state supplemental programs are reduced.

Kaiser said Holy Cross serves a catchment of roughly 50,000 people and that "75 percent of our patients are Medicare or Medicaid." He said rural hospitals operate at a structural loss because government reimbursement often falls below the cost of care; Holy Cross reported an average operating shortfall of about $2.5 million annually and a larger $4.5 million shortfall in the most recent year (figures Kaiser provided). The hospital used county support and other measures to remain open and had pursued the Healthcare Delivery Access Act (a Medicaid supplemental payment program) to stabilize services; Kaiser warned that proposed federal Medicaid cuts would threaten access to critical services and make recruiting and retaining staff more difficult.

Len Horan, chief executive director of La Clinica del Pueblo, described a community-based federally qualified health center model that has grown by adding services to meet local needs: the clinic covers about 1,700 square miles, serves roughly 2,000 patients and handles about 10,000 encounters per year, operates two buildings and a mobile unit, and provides medical, dental, behavioral health, physical therapy and a school-based health center. Horan said the clinic has recruited local providers (physicians, dental and behavioral staff who were raised in the area) and opened a physical-therapy program that is already fully booked; he noted that an ambulance costs about $375,000 and can take years to procure.

Matt Probst, director of rural engagement at the University of New Mexico Office for Community Health, described programs that build local workforce: "grow your own" pipelines, school-based health centers and community health workers (promotoras). He highlighted the HEROES and Semillas de Salud initiatives as examples of training and placing locally rooted health professionals and community health workers and emphasized integrated care and culturally appropriate outreach as key to improving utilization and outcomes.

Why it matters: presenters warned that Medicaid-driven revenue reductions would reduce services and could force facility closures, which would increase travel times for urgent care and emergency stabilization. They urged continued state support for supplemental Medicaid payments, workforce incentives and capital support (for clinic space, ambulances, and equipment) and recommended integrating behavioral health into primary care, expanding telehealth and investing in local workforce programs.

Requests and next steps: presenters asked the legislative committee to support policies that stabilize rural safety-net providers, maintain and expand Medicaid supplemental payments where possible, and fund capital investments such as clinic space and ambulances. They encouraged continued coordination among hospitals, FQHCs, UNM programs and state agencies to align workforce development with community needs.

Ending: Committee members acknowledged the fragility of the rural safety net and indicated interest in following up on Medicaid stabilization, workforce tax credits and capital-outlay options. Several members volunteered to connect providers to legislative and federal resources and to invite providers to ongoing regional coordination meetings on wildfire and post-disaster recovery.