America Needs Strong Hospitals to Support Healthy and Thriving Communities

The House Energy & Commerce Committee in just over a week is expected to mark up its portion of the budget reconciliation bill to enact key pieces of President Trump’s agenda. As we have been sharing for months, the committee could consider significant funding reductions and policy changes to the Medicaid program, although specific details of what will be included have not been released yet.  

We are continuing our full court press to make the case to lawmakers that enacting significant cuts to Medicaid would jeopardize access to care for the more than 72 million people who rely on the program and impact access to care for everyone, including limiting the 24/7 care and services hospitals provide. 

This week we sent a letter to House and Senate leaders urging them to refrain from considering disruptive policy changes to Medicaid. We also issued an Action Alert with new digital tools and resources that hospital and health system leaders can use as part of their advocacy efforts. It includes sample messages that you can share with your teams and community members so that they can reach out to their lawmakers directly and encourage them to protect access to care. 

At the same time, we’re continuing to tell our story to legislators, policymakers and key influencers. Starting Sunday, we’ll roll out new digital advertisements in Washington, D.C., publications urging Congress to protect Medicaid. In addition, the Coalition to Strengthen America’s Healthcare, of which the AHA is a founding member, continues to run digital and televised national ads, as well as engage its 2.6 million advocates in grassroots advocacy campaigns. 

And we’ll be using our Annual Membership Meeting, taking place May 4-6, to drive home the importance of protecting Medicaid and other programs that support access to care for individuals and communities. In addition to stopping cuts to Medicaid, we’ll be urging lawmakers to reject additional so-called site-neutral payment policies and harmful changes to the 340B program; extend the enhanced premium tax credits that help millions of Americans access affordable private insurance; strengthen and support the health care workforce; and provide relief from burdensome regulations and policies that inhibit care. 

New Report Highlights Economic Challenges that Hospitals Face

As we tell the hospital story on Capitol Hill, we released a new report this week showing that hospitals and health systems continue to experience significant financial headwinds that can challenge their ability to provide always-there, essential care to their patients and communities. 

Among other findings, the report shows: 

• Having the right care team available for patients has long been the single largest category of hospital spending, accounting for 56% of total costs in 2024. Amid ongoing workforce shortages, hospitals have raised wages to recruit and retain staff, adding financial pressure even as these investments are essential to maintaining care.
• Hospitals absorbed $130 billion in underpayments from Medicare and Medicaid in 2023 alone, and these shortfalls are worsening — growing on average 14% annually between 2019 and 2023. 
• From 2022 to 2024, general inflation rose by 14.1%, while Medicare inpatient payment rates increased by only 5.1% — amounting to an effective payment cut over the past three years. 
• The practices of certain Medicare Advantage plans — including increased delays, denials and underpayments — are exacerbating the financial burden faced by hospitals. 
• Tariffs on medical imports could significantly raise costs for hospitals as nearly 70% of medical devices marketed in the U.S. are manufactured exclusively overseas. A recent survey found that 82% of health care experts expect tariff-related expenses to raise hospital expenses by at least 15% over the next six months, and 94% of health care administrators expect to delay equipment upgrades to manage financial strain.

Make Your Voices Heard

While the Energy and Commerce Committee markup will be important in the fight to protect Medicaid and access to care, it’s important to understand that whatever happens, it won’t be the final word. There is still a long way to go, and the full House of Representatives and Senate will have their say as well.  

Nothing is more powerful with your representatives and senators than your voice — and the voices of your team members, trustees, patients and community members. You live, work and, most importantly, vote in their districts and states. You have their attention and can explain to them the impact policy proposals would have for their constituents and your ability to provide care.

With so much at stake, it is vital that we continue to face health care’s challenges together — speaking as one voice to protect the blue and white “H” that is a beacon of health, healing and hope in every community across the nation.