Illinois will receive $193 million each year for the next five years from the federal Rural Healthcare Transformation Program to expand health care access for 1.9 million rural residents—about $101 per person annually. The funding is meant to offset Medicaid cuts in the One Big Beautiful Bill Act (H.R. 1) passed last summer.
Health care leaders, however, warn the aid is insufficient. “It’s not going to mitigate the impact of the significant Medicaid cuts that are coming our way,” said Jordan Powell of the Illinois Health and Hospital Association. New Medicaid work requirements could leave up to 360,000 Illinoisans without coverage, while tighter limits on provider taxes could reduce state Medicaid funding by $4.5 billion a year by 2031.
Illinois has 85 small and rural hospitals, nearly 30% of which operate at a deficit and rely heavily on Medicare and Medicaid payments. The Illinois Department of Healthcare and Family Services warns that H.R. 1 provisions will threaten equitable health care access statewide. Hospitals may be forced to cut services, reduce staff, or close.
The funding formula’s fairness is also questioned: Texas, with the largest rural population, received only $66 per rural resident, while Rhode Island received over $6,300 per rural resident.