Hospital administrators remain committed to care amid economic headwinds

TAOS — James Kiser, CEO of Holy Cross Medical Center in Taos, was a student at the University of Minnesota in the ’80s when he first learned that a career in hospital administration would be unlike any other — one underpinned by a complex web of free market forces and the vicissitudes of public policy, which this year have set health care managers on edge with the passage of the One Big Beautiful Bill Act.

Kiser’s instructor showed his class a model that drove the point home. It demonstrated how easily the prices of health care services shifted with the many variable costs required to provide them, how even a small adjustment in public insurance reimbursement rates, such as Medicare and Medicaid, could take a hospital from financial stability to financial crisis virtually overnight.

“It is an unsustainable model,” Kiser told the Journal. “In the past, I’ve spoken with many advocacy groups that say the government isn’t paying their fair share.”

That’s a sentiment now top of mind, perhaps more than ever, for U.S. health care professionals.

The hospital administrators and representatives the Journal spoke with for this story emphasized that they remain committed to providing and enhancing access to care through new investments despite the significant economic turbulence on the horizon.

New Mexico hospitals are continuing to spend on new clinics and are working to attract new providers even as they reexamine their financial projections this year in light of the Trump administration’s massive budget reconciliation bill. The bill, which President Trump signed into law in July, could slash an estimated $1 trillion in Medicaid funding from health care delivery systems nationwide over the next several years.

According to an estimate by the Congressional Budget Office, through the imposition of new administrative and eligibility requirements, the spending bill could effectively remove Medicaid coverage for 11 million people by 2030 if those individuals don’t turn to alternatives, such as private insurance.

A study last year by the American Hospital Association found that a majority of hospital payments nationwide were dependent upon Medicare or Medicaid.

Lauren Madigan, COO and executive vice president at Presbyterian Healthcare Services, said New Mexico relies upon public insurance reimbursements more than any other state.

“Medicaid covers about 42% of the New Mexico population, which is the highest Medicaid per capita population in the nation,” Madigan said. “So we are more affected by the federal reform than other states.”

To the southeast, Christus St. Vincent Hospital in Santa Fe has provided more than $41 million in care to uninsured individuals in the 2025 fiscal year alone.

“Any reduction in Medicaid coverage or reimbursement could increase the number of uninsured patients, limiting their access to care,” according to a statement from the hospital. “This often results in individuals delaying treatment until their conditions become more serious and complex.”

New Mexico Health Care Authority Secretary Kari Armijio raised the alarm about the new federal spending policy this summer, warning that six to eight rural hospitals in the state could close over the next several years due to the bill’s changes to Medicaid.

Hospital administrators throughout the state say there’s still time to act and perhaps even divert federal policy onto a less dire trajectory. A new requirement that Medicaid enrollees provide evidence they have worked 80 hours per month to be eligible, for example, doesn’t go into effect until Jan. 1, 2027.

“I’m optimistic that in time, over the next two to three years, while we have a window, that sound minds will prevail,” Kiser said. “I think some of the U.S. Republican senators are going to be at risk of harming their health care delivery system in their rural states, and they will open their eyes and across all Republican senators. I think that it’ll swing.”

Meanwhile, New Mexico and individual counties are continuing to pull other policy levers to create financial backstops for state health care organizations.

For example, in 2024 the New Mexico Legislature passed Senate Bill 17, also known as the Healthcare Delivery and Access Act, which allows hospitals in the state to contribute to a pooled fund that secures an additional federal Medicaid funding match of approximately $1.5 billion annually. Hospitals receive distributions of the funds five times per year, though those will likely be less lucrative if the new federal spending bill goes into effect as written.

“That was great and positive news for us to be able to, one, maintain financial sustainability of our hospitals throughout the state, and no longer have the financial crisis that many of our hospitals were in,” said Troy Clark, president and CEO of the New Mexico Hospital Association. “Two, it allows us to invest and grow in services that we provide by being able to recruit more doctors, financially being able to support that, and to recruit them to increase access to care.”

Many of the 48 hospitals the New Mexico Hospital Association represents also rely upon a mill levy, a form of property tax, sometimes combined with a gross receipts tax allotment, to help them cover capital expenditures, such as replacing costly medical equipment and funding new facilities.

Voters in several counties will be asked to renew these public funding mechanisms in the November election. Taos County residents, for example, will be asked to renew a 1 mill levy that will generate an estimated $1.5-1.8 million annually over four years.

“I think there’s a misperception, even amongst our staff and some of our practitioners, our physicians, that we’re rolling in this dough,” Kiser said, “but all it is is going directly to medical equipment and facilities. We cannot use it for operations, you know, to meet payroll or to buy supplies or to pay utilities or maintenance.”

According Presbyterian Española Hospital CEO Brenda Romero, Rio Arriba County residents have supported a 4.25 mill levy tax since 1996, amounting to roughly $3.5 million in funding per year.

Presbyterian Española hosted a gathering of hospital executives, public officials, business partners and local residents on Tuesday to discuss some of the hospital’s expanded services, which now include a more robust addiction medicine clinic that opened this fall.

The hospital group is also planning to construct a helipad at Lincoln County Medical Center to assist with transporting patients who need higher levels of care.

“We need to think about investments that have long-term sustainability,” Madigan said.

Holy Cross is also remaining focused on its investment objectives, with the Taos County Commission approving on Oct. 7 a final negotiated contract for the hospital to construct a long-awaited urgent care and primary care clinic to serve the local community.

Gov. Michelle Lujan Grisham convened a special legislative session on Oct. 1, signing an emergency relief package to assist New Mexicans amid federal cuts to SNAP food assistance and health care programs.

“The horizon that I’m looking at now does have a gloomy outlook as I look long term,” Clark said. “If things don’t change, in 2033-35, there’s some challenges that right now we don’t know how we’re going to solve them financially to keep our hospitals open and available. But we’ve got time to continue to work on that and address those between now and then.”