Rob Tonkinson, senior vice president and CFO of Lynchburg, Va.-based Centra Health, is bracing for the financial effects that the One Big Beautiful Bill Act could have on rural healthcare and the communities it serves.
“[What’s] top of mind for me — and pretty much everybody else right now — is the coming impact of .. H.R. 1, sometimes called the ‘One Big Beautiful Bill,’ and many of us would call it the ‘One Big Horrible Bill,’ but what that impact is going to be for us as an organization, and particularly what the impact can be to rural hospitals, as those are the ones that are least able to withstand reductions in payment,” Mr. Tonkinson said during a Becker’s CFO+Revenue Cycle Podcast episode.
The legislation was passed July 4, and could result in nearly $1 trillion in Medicaid spending cuts.
Mr. Tonkinson, said historically, Virginia has expanded Medicaid access and has been good at seeking supplemental payments.
“We’re looking at potential for pretty substantial decreases in payment, starting a couple years from now and then, all of the other peripheral impacts related to requalifications and reductions in subsidies for those buying off the exchange, and all of the other lesser provisions,” he said.
Centra could also see some benefits from the legislation’s Rural Health Transformation Fund, which will shell out $50 billion over a five-year period to support rural healthcare systems. Mr. Tonkinson said that one of Centra’s four facilities could qualify for the funds.
“It’s about 75-beds that we’d have that could potentially qualify,” he said. “There’s a smaller potential that one of our other hospitals may qualify, but it’s just not quite clear yet. It’s considered rural in certain aspects, but not rural in others.”
As the healthcare industry continues to evolve, Mr. Tonkinson said it’s key for financial leaders to help find and drive efficiencies in their organizations.
“[We] need to continue to get our house in order and really minimize the expenses … and strip out [what is] less critical so that the organization can remain profitable and continue to move forward,” he said.
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