Rural America Neglected Yet Again Under the One Big Beautiful Bill

https://appalachianmemories.org/2025/09/16/appalachias-rural-hospital-crisis-deepens-in-2025/

Edited by Jacob Rabin, Aliza Susatijo, Owen Andrews, and Sarah Ahmad

As fireworks sounded on July 4th, 2025, the celebration of our nation’s independence coincided with the signing of Trump’s One Big Beautiful Bill (OBBB). The communal patriotism and, of course, innate need for a summer celebration made this legislation easy to push away as a problem for tomorrow. Now, in the nearly three months since, the OBBB’s consequences, particularly healthcare-related, are closing in. Medicaid requirements are tightening, rural clinics are facing closures, and Affordable Care Act subsidies are set to expire at the end of this year. Unsurprisingly, the GOP’s refusal to extend these Affordable Care Act subsidies and Democratic dissent over Trump’s Medicaid cuts also lie at the center of the government shutdown commenced on October 1st. The OBBB is here to stay, and its effects are no longer looming or suppressible. The projections of how many millions would lose Medicaid and how many would die due to the OBBB's healthcare cuts were daunting; however, these figures are now a foreseeable reality due to unwavering adherence to healthcare cuts as well as abruptly cutting prior subsidies or transition packages.

Despite the intense ramifications to be discussed later, the OBBB does not approach healthcare cuts as brazenly as one would expect. In fact, there is no mention of Medicaid cuts at all—only an alteration to the already vigorous process of qualifying. Able-bodied, working-age adults who are not caregiving, pregnant, or students, must demonstrate employment or the seeking of employment. While these conditions may sound somewhat reasonable or even encourage job searching, this method has already proven to be ineffective. Similar policies were already enacted in Arkansas during the first Trump presidency, and the vast majority of Medicaid recipients still met the requirements or fulfilled an exemption. The issue came to submitting applications in a timely manner. Paperwork was often misfiled, and the website used to submit Medicaid applications was reported as non-user-friendly and unreliable. Essentially, the 7.5 million applicants projected to lose Medicaid by 2034 would mostly result from paperwork issues. This sly cutting of Medicaid seems to capitalize on these candidates, most of them lower income, lacking the resources to adjust to the unfamiliar bureaucratic processes. Rural communities would also be disproportionately targeted—economist Tim Layton at the University of Virginia predicts these areas to be hit harder due to the lack of employment opportunities, hindering Medicaid qualification in the first place. 

Some less discussed facets of the OBBB include Supplemental Nutrition Assistance Program (SNAP) cuts and changes to the pharmaceutical industry. About 12.3% of Americans rely on SNAP for food stamps, though since the passing of the OBBB, SNAP is now administered at the state instead of the federal level. Even if a state prioritizes SNAP, state budgets are already stretched thin and therefore unlikely to support SNAP with the same vigor. According to the Congressional Budget Office, 3 million are predicted to lose their qualification for food stamps by 2034. While the SNAP aspect of the bill was buried, the Trump administration highlighted the OBBB’s stance on increasing the affordability of prescription medications. There are many moving parts in Trump’s approach for prescription drugs, but, in summary, there is an increase in transparency and local development incentive at the cost of raising premiums and out-of-pocket costs. Companies that manage insurance plans and prescription benefits, known as pharmacy benefit managers (PBM), are now required to present a model for their pricing that cannot hinge on simply hopping on a surrounding competition of price increases. However, this potential for increasing prescription affordability is largely undermined by expanding the list of drugs exempted from Medicaid negotiation. Manufacturers for these drugs are no longer pressured to lower prices, though no price maximums have been set: much of the cost of potential increases will be absorbed by the patients. Weakening SNAP and ineffectively tackling prescription drug prices are both actions that could worsen the overall health of the population, thus imposing a further strain on a newly less funded healthcare system.

Perhaps the most deceptive healthcare-related portion of the OBBB is the $50 billion five-year Rural Health Transformation Program. On paper, it sounds like the healthcare struggles of rural areas are finally being heard and directly treated with a significant allocation. However, this money would primarily go to Trump-supporting communities, some even newly red, who have felt disregarded by previous politicians. Unfortunately, this package is less generous and direct than it may seem. Before receiving any funds, states must apply with a rural health transformation plan. Half of the package will go to approved states, while the other half will be concentrated in at least 25% of the approved states determined to have a significant rural population as determined by the Centers for Medicare and Medicaid Services (CMS). Note that the proportion of rural population to rural facility is not taken into account, likely underrepresenting the most strained communities. Furthermore, the funds go to the state instead of the hospitals, where the money can be allocated outside of its original intent. For example, funds could go to non-rural causes like developing health-related technology. If enough interpretations like this are made, the net benefit of this package on struggling clinics and their patients is diluted. The amount of $50B itself also steeply cuts off after the 5-year plan, leaving rural communities stranded amidst the projected $137 billion cut from rural Medicaid spending by that time.

This pattern of minimizing the appearance of cuts and extending so-called helping hands has deadly consequences. Medicare cuts alone are predicted to cause 10,000 deaths per year. The cessation of the American Rescue Act, where the IRS paid for market price premiums using tax credits, could cause an additional 8,000 annual mortalities. Multiple projections place the number of rural hospital closings at around 300 by 2034, a particularly devastating number considering rural areas already experience more mortality for emergency medical events than non-rural areas. The interconnection of these events makes the overall impact all the more devastating. When Medicaid is cut, hospitals already losing money from Medicaid patients are also losing the uncovered fees patients brought in. Hospitals are then at risk of closing when the health of a population is in decline.

This grand cascade of hospital closures, revoking of Medicaid, and unaffordable prescriptions has yet to truly take effect, and it would be the best possible scenario if these projections and predictions are overstating the OBBB’s negative impact. Unfortunately, our present day seems to resemble the calm before the storm. Medicaid qualification changes are set for 2027, and only the Rural Health Transformation Program has been enacted with the start of the 2026 fiscal year. Some effects are already apparent; three local clinics in Shenandoah County have already been closed. The Virginia GOP defense has been strong, citing the clinics’ consolidation and the relocation of patients to clinics 10 miles away. Some politicians are even claiming a “rainy day fund” sufficient to battle Medicaid cuts. Where these defenses fall short is the lack of long-term perspective. “Rainy day funds” will not cover indeterminate Medicaid cuts without making the state vulnerable, and a mere 10-mile relocation can have significant consequences for emergency mortalities. Accepting and even defending the OBBB’s early impact creates a harmful false narrative that national adaptation to its policies is possible.

The creation and aforementioned defense of the OBBB is being carried out by Republicans. However, there has also been a disturbing outpour of Democratic indifference towards rural communities under the ‘you got what you voted for’ sentiment. This may be factually true, as ⅔ of rural voters chose Trump, yet this commentary fails to recognize the origins and modernity of the rural shift to red. Voting turnout is overall decreased in rural areas tired of being overlooked by both parties. States like West Virginia and Kentucky were dependably blue up until the 2020 election, West Virginia being one of the strongest Democratic strongholds in the nation. Like many rural areas, particularly in Appalachia, the downfall of coal led to the shrinking of unions, the main way Democrats appealed to rural areas. The party’s strategy then turned to urban areas, a more profitable grab in voter numbers. Hearing a president promise to ‘bring back coal’ after Democratic disillusionment is enough for many struggling with basic survival. 

The inevitable fallout from the OBBB, especially in rural communities, must therefore be treated as a bipartisan issue. The damage has been done with Trump’s OBBB, though Democrats must recognize their role in alienating these communities and step up to challenge these cuts. More moderate, non-MAGA Republicans should bridge the hostile gap and encourage some compromise, especially amidst the government shutdown where all Medicaid/Medicare is threatened if not resolved by the year’s end. The most poignant and reasonable remediation of this legislation would likely be altering the Medicaid application process. Whether this means developing a user-friendly interface or simplifying the paperwork, adjustments to the application process are the most achievable action that can be carried out immediately. The OBBB, ratified and looming disproportionately over rural communities, must be negotiated to decrease healthcare cuts and allocate funds to hospitals, as well as counteracted by increasing public awareness about the new Medicaid procedures.