Hospitals in southeastern Utah, like across the country, are preparing for more uninsured patients, tighter budgets and potential cuts to services as sweeping federal health care changes begin phasing in next year — though the extent of the impact will depend on how state leaders respond.
The One Big Beautiful Bill Act, a sweeping tax and spending package signed by President Donald Trump on July 4, makes broad changes to federal health policy. Among other provisions, it rolls back parts of the Affordable Care Act (ACA), reduces federal Medicaid funding, phases in stricter eligibility and work requirements and caps a key Medicaid financing tool — known as the provider tax — that many states, including Utah, rely on to draw federal matching dollars.
Most provisions will roll out gradually. Federal rules are expected to be finalized in 2026, with work requirements and more frequent eligibility checks taking effect as early as late 2026. Caps on the provider tax — which could affect Utah’s Medicaid expansion funding — begin in 2028 and phase in through 2034.
According to a July 2025 analysis by the nonpartisan Congressional Budget Office, the law will cut federal Medicaid spending by about $911 billion over the next decade. The budget office projects roughly 10 million people nationwide will lose coverage by 2034 due to changes to Medicaid and ACA subsidies. A separate estimate from the Congressional Joint Economic Committee’s Democratic staff projects that more than 188,000 Utahns could lose health coverage as a result, with more at risk if Medicaid expansion is reversed.
KFF, a non-profit organization focused on health policy, says new work requirements and stricter eligibility checks are expected to drive much of the coverage loss.
Rural hospitals are likely to feel the impact of the new federal law most acutely because they serve a higher proportion of Medicaid patients and already operate with limited financial margins, according to Matt McCullough, rural hospital improvement director for the Utah Hospital Association. Utah has 21 rural hospitals — including nine independent facilities without the resources of a larger system — and 14 community health centers that collectively provide care in medically underserved areas.
“Rural health, even before this bill passed, was already on a lifeline … it’s not just going to hurt the bottom line of a hospital; it’s going to make it really hard for people to get the care they need, especially in their community,” McCullough said.
Moab Regional Hospital models millions in losses
Moab Regional Hospital CEO Jen Sadoff said the bill’s combination of Medicaid cuts, changes to ACA marketplace subsidies and new limits on Utah’s provider tax threatens to squeeze rural hospitals that already operate on thin margins.
“We have structured our services around meeting a full spectrum of essential, but not always profitable, community healthcare needs,” she said. “The biggest risks for us are the reduction in coverage for our patients leading to increased uncompensated care.”
About 15% of Moab Regional’s patients are covered by Medicaid, which makes up 10% to 11% of its total revenue. Sadoff said more than 1,600 Grand County residents are enrolled in the program — roughly 16% of the population — and she estimated that as many as 600 could lose coverage or face new hurdles to keeping it as work requirements and more frequent eligibility checks are phased in.
“That would mean more patients needing financial assistance for their care, or potentially going without care,” Sadoff said.
MRH has modeled a potential revenue reduction of $1.6 million to $2.3 million once the bill’s provisions take effect — a hit that, under the hospital’s current budget, would put them “squarely into a negative margin,” Sadoff said.
The hospital already provides over $4 million in uncompensated care annually, a figure Sadoff said will likely grow as more patients lose coverage.
Given much of the legislation will not take effect until 2026 and later, Sadoff said that the hospital is using this time to “evaluate programs for cost and impact, look for ways to be more efficient and develop new revenue generating programs” to offset the anticipated losses.
If more people become uninsured, the hospital will be forced to absorb more unpaid care — straining its ability to sustain services like obstetrics, hospice and behavioral health that already operate at a loss.
(Moab Regional Hospital) Dr. Kimberly Franke, orthopedic surgeon at Moab Regional Hospital, meets with a patient.
“We may face difficult choices,” Sadoff said. Still, she said MRH is planning and adapting, not panicking.
“The good news is that Moab Regional Hospital is better positioned than many rural hospitals across the nation because we have growth opportunities that they don’t have,” she said. “We are focused on expansion and business efficiency, not contraction … Our mission hasn’t changed, and our commitment to caring for this community remains strong.”
San Juan Health braces for Medicaid uncertainty
In San Juan County, San Juan Health CEO Clayton Holt said the biggest challenge right now is uncertainty. With key provisions of the federal law delayed and dependent on how the state responds, hospitals like his are left waiting to see what comes next.
“What we do know is there will be an impact, and it will be negative,” he said. “The question we have at this point is the degree that it will impact us, and what options do we have to mitigate that to still provide the very best health care for our communities?”
Holt said about 10% to 12% of the patients of San Juan Health — which runs the hospital in Monticello and clinics in Blanding, Monticello and Spanish Valley — rely on Medicaid. The program already pays less than the cost of care, but at least it provides some revenue.
“For every Medicaid patient we see, we’re already losing money to provide those services,” Holt said. “But without Medicaid, we’re potentially losing all of it.”
(Doug McMurdo | The Times-Independent) San Juan Health’s Spanish Valley Clinic, located just south of Moab on Spanish Valley Drive and Old Airport Road, is part of the San Juan Health system that also operates a clinic in Blanding and hospital in Monticello.
As people lose coverage, he added, more will become uninsured, meaning their care becomes charity care for the hospital — further reducing revenue in a system that already runs on thin margins.
“If you lose any revenue, it just puts you in a more difficult spot … but we just simply don’t know the magnitude of that at this point,” he said.
Blue Mountain Hospital in Blanding, which has the highest share of Medicaid revenue among Utah’s rural hospitals at 37%, according to McCullough, did not respond to multiple requests for comment about how it expects to be affected.
Statewide uncertainty over funding
Across Utah, rural hospitals, on average, derive about 13% of their revenue from Medicaid, according to McCullough. Utah’s Medicaid reimbursement rate already covers only about 89 cents on the dollar for rural hospitals, leaving little margin for absorbing losses.
A key concern is Utah’s “provider tax,” which the state uses to draw federal matching funds for Medicaid. The Big Beautiful Bill will begin capping that tax in 2028, phasing it down from 6% to 3.5% by 2034. According to a 2024 KFF survey, Utah was among the 38 states with at least one provider tax over 5.5%.
“The damage that this one big beautiful bill will cause is when revenue is cut as much as it’s proposed, the hospitals have to cut services and reduce spending, and maternity and labor and delivery is typically one of the first services to get cut because it doesn’t generate revenue,” McCullough said.
Under a 2019 state trigger law, if federal changes reduce provider tax revenues and lawmakers do not replace the money, Utah’s Medicaid expansion could be rolled back entirely.
(Moab Regional Hospital) Employees at Moab Regional Hospital review patient information.
The Big Beautiful Bill also creates a $50 billion “rural health transformation program” meant to support modernization efforts such as telehealth, cybersecurity and new care models that states have to apply for by the end of the year. However, the money cannot be used to replace lost operating revenue, and McCullough warned that it will not fully offset the Medicaid cuts.
“I had somebody tell me this morning that they see it as a band-aid on a dismembered arm,” he said.
Sadoff, Holt and McCullough all said much remains uncertain until the state decides how to respond. For now, they are modeling scenarios and reviewing budgets.
“There’s not panic right now among hospitals,” McCullough said. “There’s just concern and trying to look at the numbers and figure out where the impact will be.”
Free clinic prepares for rising patient demand
The Moab Free Health Clinic, which primarily serves under- and ..uninsured residents, does not receive Medicaid funding and will not lose money directly from federal cuts. But patient navigator Mo Leed said any drop in coverage will likely send more people their way.
“As it stands today, we’re already booked a month out for … primary care appointments,” they said. “If anyone has anything more urgent that they can’t wait a month to talk to a doctor about, we’re referring them to urgent care already, and I think it’s just going to get worse.”
The nonprofit relies on volunteer providers to deliver free or low-cost primary care, women’s health exams, dental services, mental‑health counseling, vision clinics, HIV/STI testing and prevention, prescription assistance and navigation to help patients access resources and referrals. About 72% of the clinic’s patients in the last few months were uninsured.
Specialty services such as women’s health and psychiatry are already booked out months in advance. Leed said longer waits and more patients turning to urgent care or the emergency room are likely if Medicaid coverage shrinks.
“That’s our role as a safety net clinic is to be there for those patients when the systems in place don’t work and the systems in place will be working worse, so I think we’ll just have less capacity and more patients,” they said.
Resilience amid uncertainty
Hospitals and clinics across Utah are modeling scenarios, reviewing budgets and waiting to see how state leaders will respond.
“Rural hospitals are very resilient,” McCullough said. “They reflect their communities — who are very resilient people. They’ve always been required to do more with less.”
That resilience will be tested as hospitals work to absorb more costs and find new ways to keep essential services open, he said. Even so, McCullough said he wants the focus to be on adaptation rather than fear.
“When you have to do more with less, it requires you to be innovative and figure out new ways to do things and to cut costs and provide better care,” he said. “And so while there’s concern, I don’t want concern or fear to be the message. I think there’s got to be a message of hope as well.”
Brooke Larsen writes for The Salt Lake Tribune.
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