President Donald Trump’s recently signed tax and spending bill is poised to drastically reshape the health care landscape in Texas. The legislation includes around $1 trillion in Medicaid cuts over the next decade, with Texas projected to lose $39 billion in federal Medicaid funding during that period. These reductions, along with changes to the Affordable Care Act (ACA) marketplace, are expected to leave nearly 12 million more Americans uninsured by 2034, including about 300,000 Texans.
Health experts and hospital leaders warn that the increase in uninsured residents could strain the already burdened health care system. Jana Eubank of the Texas Association of Community Health Centers explained that without insurance, many patients delay care until conditions worsen, which raises costs and worsens outcomes.
“It means that they go without care, and then they end up getting much, much sicker, because a lot of times they have chronic diseases like diabetes or hypertension,” said Eubank, as first reported by the Houston Chronicle.
Though Texas avoided some of the steepest cuts that affect states which expanded Medicaid under the ACA, the law still shifts significant financial responsibility from the federal government to states and providers. John Hawkins of the Texas Hospital Association acknowledged the revisions spared Texas from a catastrophic impact but said hospitals are still evaluating the changes.
“The bottom line is that Texas Medicaid — and the hospitals that make its care possible — have not suffered the hit that was initially feared,” Hawkins said in the statement. Meanwhile, the HOPE Clinic in Houston anticipates cutting community services due to lost Medicaid support. “We’re definitely going to have to cut somewhere,” said CEO Andrea Caracostis.
Another major concern is the expiration of enhanced premium subsidies that have made ACA plans more affordable. These subsidies, introduced under the Biden administration, are set to end in 2026. Without an extension, health insurance premiums could skyrocket, potentially pushing another 4.2 million Americans off their plans. Additional administrative changes, including a shortened enrollment period and new income verification rules, could further reduce access to coverage.
Hospitals in Texas also face future financial strain from reduced state-directed Medicaid payments. These supplemental payments are used to fill the gap between Medicaid reimbursements and actual costs of care. The new law will cut these payments by 10% annually beginning in 2028. While a $50 billion fund was included to support rural hospitals, experts say it falls far short of offsetting the losses.
As Texas hospitals brace for the effects of deep Medicaid cuts and significant policy changes, health care providers across the state are warning of growing financial pressure and diminished access to care. With hundreds of thousands of Texans projected to lose insurance and crucial funding mechanisms under threat, leaders say the long-term sustainability of safety net services is in jeopardy. As the health care system adapts, many Texans may soon face higher costs, fewer services, and more barriers to essential care.
