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Hospital leaders warn federal, state budget moves could cut Medicaid funding and squeeze rural hospitals
Summary
A legislative update at the Tahoe Forest Hospital District board meeting highlighted rapidly changing federal reconciliation proposals and California budget actions that district and hospital leaders say could reduce Medi‑Cal funding and pressure rural hospitals’ finances and services.
A guest policy expert and hospital association representatives told the Tahoe Forest Hospital District board on June 2025 that pending federal and state budget actions could sharply reduce Medicaid funding and create immediate financial pressures for rural hospitals.
The briefing came from Ryan Wits, executive director of the District Hospital Leadership Forum, who reviewed developments in Sacramento and Washington, D.C. and told the board: “We are gonna start our tour tonight, in California, and then we will go to DC” to explain how recent budget choices and reconciliation proposals are evolving quickly.
Wits said the state budget deal for 2025–26 includes measures that reverse or delay previously anticipated provider funding tied to last year’s ballot measure. “We are not anticipating any provider rate increases in 2025–26,” he said, describing moves that effectively sweep $1.3 billion previously earmarked for provider investments. He also noted…
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