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You are here: Home / News / Texas rural hospitals await the budget cut storm
The hospital in Stamford, Texas, a small rural town of almost 3,000 people, closed its doors in July 2018 (Photo courtesy of Google Earth).

Texas rural hospitals await the budget cut storm

October 31, 2025 by Callie Leverett Leave a Comment

Ten years ago, inside Stamford’s small rural hospital, medical technology and equipment would beep and buzz alongside the sounds of rustling paper. Healthcare workers were kept busy while tending to patients.

Today, the building is silent. The parking lot is empty, and the structure is hollowed out.

It is single-storied and built with warm red brick. The front side is wrapped in big, tall windows with a sandstone-colored awning stretching over the circular driveway. The patchy, dead grass beneath and around the building illustrates its neglect.

The almost 3,000 people who live in the small town of Stamford do not have a hospital – the facility closed on July 9, 2018.

For inpatient care, the citizens of Stamford must drive 40 minutes south to Abilene’s Hendrick Medical Center or visit the nearby rural emergency hospital in Anson, more than 15 miles away.

Madi Marr, sophomore kinesiology pre-occupational therapy major from McKinney, said her grandparents in Stamford were forced to come to Abilene for any medical emergency.

“When my grandmother had a heart attack, we had to drive her here because she wasn’t gonna make it,” Marr said.

Marr’s family has to drive an extra 45 minutes to receive the same care at that of an urban resident.

Stamford isn’t alone in this struggle. When it comes to rural hospitals, it is survival of the fittest.

“In Jones County, Hamlin and Stamford had hospitals, but they don’t anymore,” said Craig Hunnicutt, Hendrick Health director, regional services. “Right now, there’s empty buildings sitting in Hamlin and Stamford.”

According to the Chartis Center for Rural Health, 432 U.S. rural hospitals are vulnerable to closure, with 46% operating in the red – they have negative profit margins.

“It’s a losing business,” Hunnicutt said. “Nobody would open a hospital to make money today.”

Rural hospitals’ payer mixes have fewer people with insurance, and 16.1 million rural residents rely on Medicaid for coverage, according to American Hospital Association.

A large percentage of rural patients are uninsured or rely on Medicaid for coverage. By law, hospitals must treat patients regardless of whether they have insurance or how good it is.

“Medicaid generally pays hospitals far less than the costs of caring for Medicaid patients,” according to the AHA. “The difference between Medicaid payments and costs incurred by hospitals to provide care, known as the ‘Medicaid shortfall,’ was $27.5 billion in 2023.”

With Medicaid shortfall, rural patients are charged with high balance bills, so many uninsured and Medicaid patients leave providers with debts that go unpaid.

Because rural hospitals are already underpaid, cuts to Medicaid further widen the gap between rural and urban hospitals.

John Henderson has been the CEO of the Texas Organization of Rural & Community Hospitals for seven years. TORCH’s goal is to advocate for rural and community health care, support local access and delivery of health care services in rural areas and develop specialized programs and services for rural and community hospitals, according to TORCH’s website.

“Rural hospitals are kind of the canary in the coal mine,” Henderson said. “They’re the most vulnerable hospitals, so if there were cut of any kind to the Medicaid program, rural hospitals will probably feel it first.”

In July 2025, Congress passed budget cuts that will impact Medicaid as a part of the One Big Beautiful Bill Act. With these cuts, rural hospitals will be challenged with more hardships, and millions of Americans in rural areas will become collateral damage as they lose jobs and access to nearby healthcare, industry leaders said.

According to Chartis, rural residents experience higher rates of chronic disease, are twice as likely to die prematurely from diabetes, cancer and heart disease and experience suicide rates nearly double their urban counterparts.

Texas leads the nation in loss of inpatient care via facility closure or conversion, and 47 facilities in Texas are vulnerable to closure, according to the center.

The hospital closures already have created maternity care deserts for women in rural areas.

More than half of Texas rural hospitals do not have labor and delivery, and only 40% of Texas’ 158 rural hospitals still offer obstetrical care and baby delivery services, according to TORCH.

Lynne Bruton, Hendrick’s Health’s communications and Abilene market marketing director, said when a hospital loses its labor and delivery services, it loses its community.

“Nobody wants to drive three hours and not have their loved ones with them,” Bruton said. “You know? You’re having a baby, I want my other kids to see the baby, right? You lose your community when you have to go somewhere else.”

In response to the crisis of rural hospital closures across the nation, Congress created the Rural Emergency Hospital Designation. Through the Consolidated Appropriations Act of 2021, to avoid closing completely, rural full-service hospitals can receive federal financial support and convert to REH facilities that offer emergency care and outpatient procedures.

Similarly, Critical Access Hospitals, established under the Balanced Budget Act of 1997, also receive federal financial support, through cost-based Medicare reimbursement. Full-service hospitals can convert to CAHs and still have inpatient services.

Texas leads the nation in rural hospital closure and conversion rates, but the hardships of rural health care extend far beyond Texas state lines.

According to AHA, the 1,796 rural hospitals across the United States often rely on air transport for things like severe trauma, complicated critical illness or major strokes.

Marr said that in her experience “you get life-flighted for everything,” not just serious cases.

Many rural residents with insurance buy extra coverage or memberships for air ambulance transport – something urban residents don’t have to worry about.

Over 1,000 miles away from Abilene, is Riverton, Wyoming.

If any medical case is too advanced for an ER, the almost 11,000 people who call Riverton home must be flown or driven across state lines.

Jodeyah Mills, a communication graduate student, grew up in the rural town of Riverton.

“If you do more than stub your toe, you’re getting life-flighted to Billings, Montana, or Denver, Colorado,” Mills said. “They have to drive, or they have to be flown somewhere if they want their lives saved.”

When Mills was in his early teenage years, his family moved to Colorado. While there, Mills’ father was diagnosed with metastatic melanoma.

But during Covid, his mother’s business closed, and his father was on medical disability. Without a stable income, they were evicted and forced to move back to Riverton.

Now progressed to Stage IV, and moved to his spine, Mills’ father needed a paracentesis, a procedure simple enough for Riverton’s hospital to perform.

“He had bone spurs, and he was in extreme pain. He had a brain tumor, and his cancer had gotten to the aggressive . . . where we could literally see it, week to week, growing all over his body.”

Mills and his family brought his father to Riverton’s ER. Mills said he stood at the ER entrance, waiting for the automatic doors to slide open –but they did not.

In desperate need to get his father inside, Mills dug his fingers into the crack of the rural hospital doors and pried them open.

Mills said his cousin, Mason, who was a medical student in sports physiology, went in with his father.

“He knew how to properly stabilize a neck and spine,” Mills said, “and he’s watching these doctors try to move my dad and immediately is like, ‘That is not how you move someone with a spinal injury.’”

The medical staff dropped his father, Mills said, and his cousin had to take over to stabilize him. The paracentesis was performed, and they were sent home; however, Mills said his father was never the same after that.

“If it wasn’t for Covid and having to move to a rural town with no cancer treatment, like real cancer treatment facilities and no actual hospital help, I really do think my dad would’ve survived longer,” Mills said. “I really do believe that.”

Healthcare workers in rural areas are at a disadvantage – put in a situation that made it harder for them to succeed. Mills said he does not blame Riverton healthcare.

“That’s not to say that these people are horrible or that these medical professionals are idiots,” Mills said. “It’s just to say that the circumstance was poor.”

With family and friends that work in healthcare, Mills said he understands that “the system doesn’t really help them succeed.”

There is a new medical facility in Riverton, to be overseen by Billings, Montana, Mills said. According to the Riverton Medical District, the facility is meant as a lifeline for the community.

Congress has worked to address the rural healthcare crisis, like passing laws for Critical Access Hospitals and Rural Emergency Hospitals, and communities have come together, like Billings and Riverton. So, things are being done, and progress is being made, but budget cuts to Medicaid risks a severe regression on any improvement.

The House drafted a budget resolution to require committees to reduce their savings deficit by 2034. The Committee of Energy and Commerce will have “to reduce the deficit by not less than $880 billion for the period of fiscal years 2025 through 2034,” according to The House.

According to Congress.gov, a budget resolution is a way for Congress to help “guide federal spending and revenue policies;” it is not law. However, through the process of reconciliation, these policies can quickly be enacted into law.

The OBBBA President Donald Trump signed on July 4, 2025, is expected to tank healthcare in rural communities.

The bill does contain $50 billion, five-year Rural Health Transformation Program that is intended to offset blows to rural healthcare; however, $50 billion is not a sufficient amount to counteract the more than $1 trillion in cuts to Medicaid.

According to the Center for American Progress, “if every rural hospital in the country received an even share of the $50 billion in relief support, it would amount to only $4.5 million every year for five years. At the close of those five years, that funding would disappear altogether.”

And the silent struggle of rural healthcare will persist through the budget cut storm.

Filed Under: News

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You are here: Home / News / Texas rural hospitals await the budget cut storm

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