From capacity constraints to reimbursement pressures, health system CEOs are navigating a changing healthcare landscape.
One of the top concerns in 2025 is the potential for Medicaid funding cuts. A recent report estimates hospitals could face a $31.9 billion loss in revenue if federal proposals to scale back Medicaid expansion move forward.
CEOs from across the country — including safety-net systems, academic medical centers and expanding regional providers — recently shared how they are preparing for continued uncertainty and what strategies they are prioritizing in response.
Larry Antonucci, MD, president and CEO of Fort Myers, Fla.-based Lee Health, highlighted state and federal budgets, with a focus on protecting Medicaid funding in 2025. This comes as Lee Health is expanding to address growing demand and strengthen the care continuum with a new healthcare campus slated to open in 2028.
“Budgetary issues are always a concern, whether it’s at the national level and the state level,” Dr. Antonucci told Becker’s in April. “We are in the middle of our legislative session for the state of Florida, so we’re actively engaged in that and making sure that Medicaid reimbursement is protected. Similarly, at the federal level, we’re looking at the supplemental programs where we want to make sure that those are protected long term.”
Elaine Batchlor, MD, CEO of MLK Community Healthcare — a safety-net health system based in South Los Angeles — shared that her strategy has been dominated by proposed cuts to Medicaid funding — and what they could mean for the community and for the survival of the system’s 131-bed Martin Luther King Jr. Community Hospital.
“We are definitely having conversations about the potential threats to our funding and what that would mean to our services,” Dr. Batchlor told Becker’s in March. “We’ve talked about which services we might have to stop providing to our community. Unfortunately, labor and delivery is always vulnerable when finances are stressed, because most hospitals lose money on labor and delivery services.”
Marc Gorelick, MD, CEO of Minneapolis-based Children’s Minnesota, highlighted efforts at his organization that he strongly endorses and hopes will continue after his planned retirement in July. This includes embracing continuous improvement.
“One of our organizational values is adaptability, and that’s particularly important in an ever-changing healthcare environment like the one we’re in,” Dr. Gorelick told Becker’s in March. “As the pace of change accelerates, we have adopted both a system and a mindset of continuous improvement so that we can always deliver care that excels in all six domains of quality, even as the environment we’re operating in is changing.”
Chris Howard, CEO of San Diego-based Sharp HealthCare, described efforts to identify new revenue sources to offset rising costs, including California’s new $25-per-hour minimum wage and the state’s 2030 seismic compliance requirements for hospital facilities, which will require more than $1 billion in expenses. Sharp is also prioritizing transitioning high-cost, hospital-based outpatient surgical services to lower-cost, freestanding surgery centers to reduce the cost of care given that it is a population health-oriented system.
“Our nation’s healthcare industry most certainly has its challenges, both at the federal and state levels, but I feel we are on the cusp of major advancements in healthcare,” Mr. Howard told Becker’s in February. “My belief is that as we move forward, we will move more deeply into value-based care and population health management, so that we as an industry can truly reduce the cost of care, better manage the health of those we serve, and improve the consumer experience while advancing provider and employee engagement.”
Laura Kaiser, president and CEO of St. Louis-based SSM Health, discussed her organization’s blueprint to navigate the evolving healthcare environment. As part of that discussion, she highlighted a leadership development initiative around change management.
“At SSM Health, we introduced a yearlong change management training for all of our leadership — vice president and above,” Ms. Kaiser told Becker’s in February. “Our expert organizational development team formalized a program which included individual study, small groups and leadership meetings. It was an organization-wide investment already proving to be helpful. This year, we are building on that by having leaders read the book “The Speed of Trust” by Stephen M.R. Covey, which is an oldie but goodie, to add to our change management skills. Trust is everything. If there’s trust, you can move much faster, and we need to move with agility in this current climate, more than ever.”
Patty Maysent, CEO of UC San Diego Health, has seen an increase in demand for services in the region, especially quaternary care, prompting the system to explore new strategies to manage capacity. UCSD Health is also working to stabilize care in California’s Imperial Valley, currently managing El Centro (Calif.) Regional Medical Center and collaborating with the Imperial Valley Healthcare District, which operates Pioneers Memorial Hospital in Brawley, Calif., in support of unifying the hospitals.
“The only sustainable long-term solution is for them to come together and to have enough scale, so that we can have a cancer footprint out there, 24/7 critical care, a single radiology service that could cover the whole region, so that they have better care closer to home,” Ms. Maysent told Becker’s in March. “The point is not to bring patients into San Diego or to Palm Desert. The point is to keep patients there and ensure that they have access to the best community-based and tertiary care that we can build out there.”
Glorimar Medina, MD, recently assumed the newly-created role of CEO of hospital campuses at Bellaire, Texas-based Harris Health. In discussing her top priorities in her new role, she emphasized the need for organizational adaptability amid a shifting healthcare landscape.
“In healthcare at this moment, there are many changes for us,” Dr. Medina told Becker’s in March. “Specifically being in Houston, Texas, our funding streams are in a state of flux. Top of mind for me is just being able to have the platforms and position them in the best way to respond to all of those changes.”
Jim Shmerling, DHA, who is preparing to retire this year as president and CEO of Hartford-based Connecticut Children’s after a decade at the helm, discussed Medicaid funding challenges and how potential funding cuts could affect his organization, where more than half of patients are enrolled in Medicaid.
“When we’re not recovering nearly what it costs us to provide care and the Medicaid enrollment keeps going up, it’s an existential crisis for us,” Dr. Shmerling told Becker’s in March. “The potential for Medicaid to be losing funding from the federal government puts even more pressure on the state. And then, of course, it rolls downhill to us from the federal level.”
