Mississippi lawmakers face pressure to counter looming federal cuts to health care after punting this session

By Gwen Dilworth | Originally published by Mississippi Today

State lawmakers face a daunting task to blunt the effects of looming federal cuts that threaten to erode health care affordability and access in the years ahead, especially after they failed to address some of the most pressing issues during the legislative session, experts warn.

Hospitals in Mississippi — already strained under the costs of caring for a high rate of patients without health insurance and with low-reimbursement plans, such as Medicaid — are expected to lose $1 billion over the course of the next decade as a result of President Donald Trump’s sweeping tax and spending bill signed into law in July. 

To complicate matters further, federal enhanced premium tax credits for Affordable Care Act Marketplace insurance expired late last year. That happened after Congress did not extend them, making health care less affordable for hundreds of thousands of Mississippians.

Rep. Sam Creekmore, a Republican from New Albany and the chair of the House Public Health Committee, said much of next year’s legislative session will likely explore policy options to offset federal cuts. 

“I figure that will be a lot of our time going forward out of session and next year,” Creekmore said. 

But mitigating the full impact of cuts of this scale will be difficult for states, said Joan Alker, executive director of Georgetown University’s Center for Children and Families.

“As a general matter, states are not going to be able to fill the gaping hole that Congress and President Trump have created here,” Alker said. “[No] state, no matter how wealthy or well-intentioned, is going to be able to sustain that.”

Sen. Hob Bryan, a Democrat from Amory and chair of the Senate Public Health Committee, shared this concern.

“To a large extent, some of those decisions are made in Washington and there’s nothing we can do about them,” Bryan said, adding that the state could do more to improve access or availability of health care as federal funding cuts take effect. 

The new federal law shrinks state-directed payments, which allow states to beef up low reimbursement rates from Medicaid to hospitals. The enhanced rates will be reduced gradually beginning in 2028, resulting in an expected annual loss of at least $160 million to Mississippi, a change some advocates say could severely damage struggling rural hospitals. This figure is comparable to about 14% of the state’s spending on Medicaid for the coming year.

Lawmakers will likely look at ways to shore up hospitals’ revenue, including creating new payment programs or restructuring the tax model that helps fund supplemental payment programs in coming years, said Richard Roberson, president and CEO of the Mississippi Hospital Association. 

The path forward may become clearer, Roberson said, once stakeholders know exactly how Republican Gov. Tate Reeves plans to spend nearly $206 million allocated to the state as a part of the federal Rural Health Transformation Program. The program was designed to reduce the disproportionate impact already-struggling rural hospitals are expected to bear as a result of last summer’s federal spending cuts.

But this fund alone will not replace the cuts to rural hospitals, Alker said.

“It’s not enough money, and it’s not designed to replace it,” she said. “…This is not going to address the crisis that many rural hospitals are facing.” 

Bryan said the funding represents a huge opportunity for rural areas, but he is concerned about the limited opportunities for the public to have a say in how it is spent. 

“If you haven’t received a personal invitation from the governor, you have no input at all,” Bryan said. “There are enormous things that could be done to shore up health care in rural areas. … I’m absolutely terrified about what is going to happen to people in rural areas. Rural areas have been transformed by the big boys before.”

He noted there are opportunities to use the funding to increase obstetric services in areas where they are limited, implementing a neonatal intensive care unit in the Delta and using community health workers to deliver care. 

Reeves vetoed a bill that would have increased oversight over his spending of the hundreds of millions of federal dollars allocated to the state as a part of the program and lawmakers failed to override the veto. 

Roberson said the hospital association has not received any indication from the Mississippi Division of Medicaid about what solutions for the funding losses are under consideration. He said discussions on how the state will handle the sweeping, pending cuts have not yet taken place. 

“It would be helpful to get everyone in a room and talk through these issues together,” Roberson said.

Uninsurance rates are expected to rise in Mississippi due to the expiration of the enhanced tax credits for Marketplace health plans, which primarily insure small business owners, employees, farmers or people who are self-employed.

States addressing the expiration of the tax credits are a pressing issue, because it is already impacting people whose health care premiums skyrocketed after the expiration of the tax credits, Alker said.

In January, early enrollment data showed Marketplace enrollments were down about 8% — a figure that experts expected to fall further, because people may drop coverage after receiving their first bill reflecting a higher monthly premium. 

Research shows that as health care subsidies decline, insurance enrollment falls. One study in Massachusetts showed insurance take-up dropped about 25% for each $40 increase in monthly health care premiums. 

Mississippi lawmakers did not take steps this year to make Marketplace health plans more affordable, even as more than a dozen other states passed measures to provide their own Marketplace subsidies to supplement federal policies. 

One bill that failed would have created a fund from insurance premium taxes to offset the costs of Marketplace insurance programs and developed a plan for health care coverage to uninsured Mississippians who are ineligible. It was authored by Rep. Robert Jonhson III, the House Democratic leader from Natchez, and it was never taken up for consideration by the Insurance or Appropriations A committees. 

Rep. Kevin Felsher, a Republican from Biloxi and co-chair of the House Public Health Committee, said he would support any program with guardrails that would help people access insurance or basic primary care.

“We can either help people on the front end or we can help on the back end, and the back end is a lot more expensive and a lot less pretty,” Felsher said. 

Medicaid expansion has become an increasingly rare topic of discussion at the Capitol since the 2024 legislative session, when lawmakers came close to reaching a deal on the policy but ultimately fell short. Mississippi is one of 10 states that have not expanded Medicaid to people who work for modest wages in jobs that don’t provide insurance. Expansion would make roughly 200,000 people eligible for coverage and draw down billions of federal dollars for health care. 

The federal tax bill places heavier financial cuts and administrative burdens on states that have expanded Medicaid, but the costs still outweigh the benefits, said Alker. She noted that expansion would still allow Mississippi to receive 90 cents for every 10 cents it puts up for the program. 

“Unquestionably, it would be a win for families and other folks with chronic conditions who desperately need health insurance,” she said. “It would provide a permanent, reliable source of financing for rural hospitals who would have more of their patients covered.” 

Khaylah Scott, program manager at the Mississippi Health Advocacy Program, said lawmakers introduced Medicaid expansion bills in the House and Senate, but none were taken up in committee for consideration. 

She added that, paired with lawmakers’ meager efforts to help people afford Marketplace health insurance, she was discouraged by the limited action this session to improve health care affordability.

“Are we just going to do nothing?” she asked. 

Felsher said policy changes to health care affordability will require the support of other legislative committees, including the Medicaid and Insurance committees. Lawmakers can also enact policies to promote employment opportunities, which will in turn lead to growing population centers and more insured patients for struggling hospitals, he said. 

“It’s all a puzzle,” he said. “I don’t think there’s any one silver bullet. I think it’s going to take a lot of things.” 

Lawmakers made several notable health care policy changes this session, Roberson and Scott said. Both pointed to legislation passed that would temporarily ease state approval requirements for rural hospitals, allowing them to add new services or make costly upgrades as lawmakers try to help struggling facilities expand care and increase revenue.

“That’s an explicit policy decision to try to actually provide health care in small towns,” Bryan said. 

Mississippi also is enacting one new law requiring health plans to cover biomarker testing, which helps doctors develop treatment plans for patients and avoid therapies that are unlikely to work, and another law prohibiting step therapy for patients with advanced metastatic cancer. Roberson pointed to successes in increasing radiologist assistants’ authority to communicate radiologists’ findings to other health care providers and establishing a tax credit for people or companies that donate to rural hospitals. 

“There wasn’t one single, big earth-shattering bill this year,” Roberson said. “And I think the combination of all these different bills can lead to some improvements in the delivery and access to health care across the state.”

This article was originally published by Mississippi Today and is republished here under a Creative Commons license.

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