Northern New Mexico hospital leaders hopeful new rural health fund could bring dollars to state

SANTA FE — New Mexico hospital leaders are worried about impending federal cuts to Medicare and Medicaid but hopeful a new rural health fund could help them expand services instead of cutting back.

“We’re lifelines for people in our community,” said Brenda Romero, Presbyterian Española Hospital administrator.

Gathered in the newly opened Christus Regional Cancer Center on Wednesday, hospital heads from Las Vegas, Española, Los Alamos and Santa Fe met with U.S. Sen. Ben Ray Luján, D-N.M., to discuss Medicaid and Medicare cuts passed in July in a broad tax bill.

Northern New Mexico residents already struggle to access women’s health care and behavioral health care, and any hospital closures in the region could make emergency care access a problem. But the same bill also created a $50 billion rural health transformation fund that could benefit New Mexico hospitals.

“There’s not enough beds in our state to handle the capacity. … That’s already a reality in our state, and that’s where I’m hopeful that these funds will improve our access to care tremendously,” said Tracie Stratton, chief executive officer of Los Alamos Medical Center. “Because I’m hoping it’ll allow extra staff, extra beds, extra services in the state, so that the reality that we face today doesn’t continue.”

The rural health fund could offset just over a third of the $137 billion reduction in Medicaid spending in rural areas over the next 10 years, according to the Kaiser Family Foundation. Overall, Medicaid spending cuts are estimated at $911 billion over the next decade.

On Sunday, Centers for Medicare and Medicaid Services Administrator Dr. Mehmet Oz announced on “Face the Nation” that applications for the rural health fund will open in September.

The state needs to get a plan together for applying to the fund, said Julia Ruetten with the New Mexico Hospital Association.

A lower cap on hospital taxes included in the bill will also reduce the capacity of a matching fund used by New Mexico to draw down federal Medicaid dollars for hospitals. Ruetten estimates the capacity of the state-directed payment program will go from $1.5 billion to somewhere between $400 million and $600 million.

While White House Deputy Press Secretary Abigail Jackson said the “one big beautiful bill” is “putting America first like never before, delivering huge savings for hardworking families, boosting our economy, and securing our borders,” Democratic politicians like Luján and U.S. Rep. Gabe Vasquez, D-N.M., are still drawing attention to potential fallout for health care and food aid from policy changes in the bill.

Luján was scheduled to meet with Española school district leaders to talk about cuts to the Supplemental Nutrition Assistance Program on Wednesday afternoon, while Vasquez was in southern New Mexico speaking with Carlsbad Medical Center leadership.

“Under the new tax law, we expect to deliver more uncompensated and emergency care, which means a harsher financial reality for our hospital,” Interim Chief Executive Officer of Carlsbad Medical Center Matthew Banks said in a statement.

All three of New Mexico’s House representatives will be up for election during midterms next year, as will Luján, and the tax bill appears to be unpopular with voters, according to polls from Quinnipiac University and Fox News.