Iowa Democrats celebrate Medicaid anniversary, warn of spending cuts’ impact

WASHINGTON, Iowa — Iowa City Democrat Christina Bohannan said she knows what it’s like for rural families to lose health care.

She recounted growing up in a mobile home, in a rural town of 700 people in Florida. While in high school, her father — who worked construction — fell ill from emphysema and had his health insurance canceled because of his preexisting condition, leaving her family in a bind to cover his medical expenses.

“He hit his coverage limit on his insurance, and then they canceled his health insurance,” Bohannan said. “ … So at that point we kind of lost everything trying to pay for his prescriptions and, you know, all that kind of stuff.”

It’s a scenario the Democratic congressional candidate worries will become more common as Medicaid, the U.S. health care safety net for millions of low-income Americans, is chiseled back under Republicans’ sweeping tax and spending bill.

Bohannan, a University of Iowa law professor, is seeking to challenge Republican Iowa U.S. Rep. Mariannette Miller-Meeks for a third time.

Miller-Meeks has survived two close elections and national Democrats have once again targeted Iowa's 1st Congressional District as a potential pickup in the 2026 midterm elections. The 20-county district includes the cities of Davenport, Iowa City, Burlington and Indianola.

Hospital CEO says more than half of patients on Medicare or Medicaid

Bohannan stopped Wednesday to tour Washington County Hospitals and Clinics and discuss with CEO Todd Patterson the financial struggles rural hospitals will likely face due to Medicaid spending reductions recently enacted by federal Republican lawmakers, and the broader impact on health care access.

Patterson has been outspoken about the effects of the bill could bring, both to patients and their providers.

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“For rural hospitals like Washington County Hospital and Clinics, Medicaid is not a line item — it is a cornerstone,” Patterson wrote in a guest column for The Gazette. “Roughly one in five Americans relies on Medicaid, but in rural areas, that percentage is significantly higher. In Iowa and many other states, Medicaid covers a disproportionate share of children, seniors in long-term care, and working adults struggling to make ends meet. When policymakers in Washington or state capitals slash Medicaid funding or narrow eligibility, they are turning off the oxygen for rural health care.”

“Unlike larger urban systems with diversified service lines and philanthropic cushions, we rely heavily on government payers. At WCHC, over 60 percent of our patients are covered by either Medicare or Medicaid.”

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The bill reduces health care spending through changes to Medicaid eligibility, benefits, and funding mechanisms, while also making adjustments to Affordable Care Act (ACA) subsidies.

Federal Medicaid spending will be reduced by $911 billion over the next 10 years under legislation passed by the Republican-led Congress and signed into law by President Donald Trump, according to the nonpartisan Congressional Budget Office.

Republicans, including Iowa’s congressional delegation, contend Medicaid program spending still will grow each year in line with the broader economy.

When estimating the budgetary impact of legislation, including potential Medicaid cuts, they say the CBO's baseline projections assume continued growth in federal Medicaid spending under current law, reflecting factors like population growth and rising health care costs. Therefore, any "cuts" to Medicaid proposed in legislation are typically measured against projected increases in federal spending.

Republicans argue the program has been massively expanded over the last decade, and as a result many medical practices are unable to take on new Medicaid patients, causing recipients to wait longer and travel farther for the care they need. The bill’s Medicaid reforms, they say, will allow the program’s resources to be focused on those who truly need assistance, giving them better access to medical care.

Cutbacks to Medicaid eligibility and the Affordable Care Act (ACA) marketplaces included in the reconciliation bill, however, are projected to increase the number of uninsured Americans by millions.

Patterson said the proposed changes will only worsen the financial difficulties faced by WCHC and other rural hospitals, many of which operate on already thin margins and rely heavily on Medicaid reimbursements.

About 15 percent of the hospital’s patients are covered by Medicaid, he said. Another 55 percent are covered by Medicare, the federal health insurance program for seniors and people with disabilities.

The expected increase in uninsured individuals will translate to higher levels of uncompensated care for hospitals, exacerbating their financial challenges, Patterson said.

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The bill also does not extend enhanced premium tax credits that helped individuals afford ACA plans, which are set to expire at the end of the year, leading to increased costs and contributing to the rise in the uninsured rate.

A $50 billion Rural Health Transformation Fund was established under the sweeping reconciliation bill to mitigate impacts, but experts believe it will not be enough to offset the losses.

The $50 billion covers roughly a third of the estimated $137 billion in Medicaid cuts for rural areas, according to health policy organization KFF. The fund is also temporary, and much of it may not directly benefit rural hospitals facing high uncompensated care costs, Patterson said.

Hospital networks have said they might reduce pediatric, maternity or behavioral health services; close rural facilities; or layoff workers if the Medicaid changes become law, according to a recent member survey by the American Medical Group Association.

According to the Center for Healthcare Quality and Payment Reform, 20 rural Iowa hospitals are at risk of closure, with five facing immediate risk of shutting down.

Forty-eight percent of rural hospitals operated at a financial loss in 2023. A total of 92 rural hospitals have closed their doors or been unable to continue providing inpatient services over the past 10 years, according to the American Hospital Association.

Proposed Medicaid cuts will only worsen the financial difficulties faced by these hospitals, Patterson said.

The rise in uncompensated care will exacerbate challenges in access to care, particularly for emergency and specialized services, and contribute to delays in care, he said.

Additionally, less money in the system leads to austerity in staffing models, impacting the workforce, especially in small towns like Washington, where the hospital is second or third largest employer in the county.

“We're a huge economic engine for this county. So if you start looking at, you know, the ramifications associated with less investment in Medicaid, less coverage, more impact on the workforce, suddenly you're starting to kind of impact the engine that drives the economy of Washington,” Patterson said.

Bohannan emphasized the need to repeal Medicaid cuts contained in the bill, invest in rural health care and protect federal safety net programs to prevent further economic and health crises.

“The thing is, these Medicaid cuts don't just affect the people on Medicaid,” Bohannan told reporters Wednesday during a news conference. “They affect access and affordability of health care for everyone. Health care costs will go up for all of us as a result of these cuts, because the medical costs of uninsured people are going to be passed along to the insured, and all of us will find it harder to access the treatments that we need as local hospitals shut their doors, cut staff or reduce services.

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“ … I have traveled every corner of southeast Iowa, and I have seen firsthand that our smaller Iowa hospitals have been struggling already for years,” she continued. “These Medicaid cuts could be this final straw that forces them to close or to reduce staff and beds or to cut vital services.”

Miller-Meeks, a former ophthalmologist and director of the Iowa Department of Public Health, said as a physician she knows “how vital Medicaid is for our most vulnerable citizens and why we must protect it.”

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“Through the One Big Beautiful Bill, Medicaid spending will increase 25—30 percent over the next 10 years, even while cutting waste, fraud and abuse and ensuring only eligible individuals receive benefits, reforms every Democrat opposed,” Miller-Meeks said in a statement to The Gazette. “ … It is irresponsible not to address the unsustainable spending trajectory of Medicaid which unchecked will outpace defense and interest payments on debt.”

Bohannan said Congress can both reduce the debt and still protect people with Medicaid.

“I would say it's really ironic that she's saying that about Medicaid when she literally just voted for a bill that blows up the national debt more than we have seen in a very long time,” she said.

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The nonpartisan Congressional Budget Office estimates the bill will increase budget deficits by $3.4 trillion over the next 10 years. Another CBO analysis, requested by Senate Republicans and using a different accounting method that excludes the cost of permanently extending the 2017 tax cuts, arrived at a figure of a $366 billion increase in the deficit from the same bill.

National Republican Congressional Committee Spokesperson Emily Tuttle, in a statement, accused Bohannan of “staging political theater in a desperate attempt to scare voters and protect the broken status quo that prioritizes taxpayer-funded benefits for illegal immigrants over the needs of Iowans.”

Democrats warn against cuts on 60th anniversary of Medicaid creation

The Iowa Democratic Party also held a conference call with Iowa reporters Wednesday to highlight the 60th anniversary of Medicaid’s creation and warn against Medicaid spending reductions recently enacted by federal Republican lawmakers.

Iowa Democrats’ call included Catelin Drey, the party’s candidate for the Iowa Senate in a special election scheduled for late August, and Tara Guion and Sandy Holland, two Iowa mothers who whose children receive services through Medicaid.

Republicans have argued the spending reductions are necessary to ensure Medicaid’s long-term financial stability and that the spending cuts and also recently enacted work requirements will ensure the program is preserved for those who truly need it.

Drey argued Republicans “are unable to point to any measurable amount of user service that they claim to be waste, fraud and abuse, I think just pokes holes in that argument.”

Drey went on to advocate for “preserving the program that’s worked so well to protect families like Tara’s and Sandy’s.”

The Gazette’s Erin Murphy contributed to this report.

Comments: (319) 398-8499; tom.barton@thegazette.com