Federal cuts threaten 600 financially vulnerable hospitals nationwide

New research study show hospitals' aggregate deficit to grow by between 50 and 75 percent

More than 600 financially vulnerable hospitals across the United States are set to experience an aggregate increase in financial deficits of between 50 and 75 percent. The financial losses, estimated in a new research study by National Nurses United (NNU), present an extreme risk of cuts and closures of essential health care services for millions of people across the country.

In the report titled "A Preventable Crisis", NNU, the nation's largest union of registered nurses, analyzed the impact of three concurrent federal health care cuts to hospitals nationwide. The largest financial hit stems from the July 2025 passage of H.R. 1, which reduced $1 trillion in critical health care funding, particularly for Medicaid and Affordable Care Act subsidies, while delivering massive tax benefits to the wealthiest households in America.

"The research is clear: Hundreds of communities nationwide stand to lose access to life-saving care because national leaders chose to prioritize the interest of the wealthiest Americans," said NNU President Jamie Brown, RN. "The true cost of the federal government's misplaced priorities will not be measured in the balance sheets of hospitals. Instead, the true cost - and what keeps nurses up at night - will be the consequences of our patients delaying emergency care and abandoning preventative services, as well as mounting financial burdens on working families and weakening local economies."

Based on an analysis of more than 3,900 hospitals' five-year financial history, NNU identified 602 financially vulnerable hospitals, which carry an aggregate deficit of $10.16 billion before a single cut even takes place. When applying the three federal health care cuts to this group of hospitals, NNU found that the combined fiscal contraction would add between $5.21 and $7.72 billion in aggregate deficit in a year when the full impact of H.R.1 takes effect.

The total combined loss of $15.37 and $17.88 billion in aggregate deficit, across the 602 financially vulnerable hospitals, would impact:

• 131 Critical Access Hospitals, which by federal designation, are the sole or primary hospital serving rural communities, risking the elimination of emergency, surgical, and inpatient care for entire counties;
• 469 Short Term Acute Care hospitals, which handle most inpatient admissions, emergency visits, and surgical procedures for working people in urban and suburban areas;
• Rural and micropolitan communities, where nearly 40 percent of the financially vulnerable hospitals are located, and metropolitan communities, where the remaining 60 percent of hospitals function as safety-net providers; and
• Nearly every single state, with the largest concentrations of financially vulnerable hospitals in California (67), New York (40), Texas (35), Oklahoma (27), Kansas (23), and Alabama (23).
• States that did not expand Medicaid and whose hospitals will experience revenue loss from the expiration of ACA enhanced subsidies, including in Florida (12), Georgia (10), Texas (35), Mississippi (19), South Carolina (7), Alabama (23), and Tennessee (17).

The federal health care cuts stem from three unique sources:

1. a mandatory two percent Medicare sequestration triggered by federal debt levels;
2. a projected 10 to 18 percent reduction in Medicaid funding under H.R. 1, and
3. the expiration of enhanced Affordable Care Act (ACA) marketplace subsidies that vary between states.

NNU's report proposes three policy recommendations, including the reversal of the three concurrent federal cuts and the creation of a federal program to support financially vulnerable hospitals. The Financial Vulnerability Program would ensure that populations served by financially distressed hospitals in urban and rural communities retain access to essential care by reimbursing hospitals at 101 percent of costs for Medicaid and Medicare.

"We are hurtling toward a loss of health care services that will be unsustainable for hundreds of communities and the millions of Americans they serve," said NNU Executive Director Puneet Maharaj. "If legislators act now, we can save our hospitals before closures, service eliminations, and health crises take place. Without action, we are choosing a path of irreversible harm to patients, to communities, and to public health."

The full report can be found here.

Red Alert Save Our Hospitals tour: nurses fighting back and building power

National Nurses United has launched the Red Alert tour in response to the unprecedented attack on public health threatening more than 600 hospitals and the communities they serve. The Red Alert tour aims to build local community awareness in support of systemic reforms and nurses' Vision for a Healthy Society. To date, nurses have visited communities in Glendale, Oceanside, Alameda, and Oroville in California; Minneapolis, Minn.; and Kalamazoo, Mich.

"Nurses reject the deadly agenda of the billionaire class and their Republican puppets," said NNU President Jamie Brown, RN. "We're taking the wheel and bringing our vision for a healthy society directly to patients and communities who will bear the brunt of Republican policies. We invite everyone who has felt abandoned by the political system to join us and build real working-class solidarity."

In addition to the policy proposals outlined in "A Preventable Crisis," NNU strongly endorses Senator Bernie Sanders' comprehensive tax proposals to change the U.S. tax system and raise trillions in revenue. This would keep hospitals and health services accessible, eventually guarantee health care for all through Medicare for All, and build the pillars for a society that takes care of everyone's needs, including affordable housing, education, and unionized living-wage jobs. He also introduced, alongside Representative Ro Khanna (CA-17), the Make Billionaires Pay Their Fair Share Act, which would establish a five percent annual wealth tax on billionaires and invest the revenue in working families, including reversing the H.R. 1 Medicaid cuts, and expanding Medicare to include vision, hearing, and dental.

National Nurses United is the largest and fastest-growing union and professional association of registered nurses in the United States with more than 225,000 members nationwide. NNU affiliates include California Nurses Association/National Nurses Organizing Committee, DC Nurses Association, Michigan Nurses Association, Minnesota Nurses Association, and New York State Nurses Association.