Following President Donald Trump’s signing into law the so-called One Big Beautiful Bill, officials are beginning to tally up the fallout in Minnesota and warning that the state could lose $500 million annually in Medicaid reimbursements, significantly impacting hospitals and nursing homes.
John Connolly, Minnesota’s Medicaid director, expressed concern over rising costs for both governments and health care providers, including nursing homes, who will face more uncompensated care. The bill also introduces strict new work requirements for able-bodied Medicaid recipients, demanding monthly and quarterly proof of employment. This is expected to increase administrative burdens and require additional government staffing, he said.
“I think it’s a tremendous increase in the cost to both state and county governments, but also to providers in terms of uncompensated care,” John Connolly, the state director of Medicaid, told a CBS News affliate.
The Kaiser Family Foundation estimates between 152,000 and 253,000 Minnesotans may lose health coverage as a result. These cuts would shift financial burdens to state and county governments, likely increasing local taxes.
Hennepin Healthcare, Minneapolis’s largest safety-net hospital, anticipates losing $145 million annually due to the bill. Half of its 190,000 annual patients rely on Medicaid, which also covers 87% of births there. Despite funding cuts, the hospital must still treat all patients, potentially resulting in longer ER wait times and reduced access to specialty care. Doctors noted in the CBS News story said that patients who delay treatment due to reduced access may end up in overcrowded emergency rooms with more severe conditions, and this could have ripple effects through out the health care continuum, including on nursing homes.
While the tax cuts will become visible to most Americans by spring 2026, some provisions – like the Medicaid work requirements – won’t be implemented until 2027, after the upcoming midterm elections. State officials are still reviewing the bill to fully understand its implications on local programs and policies.
