Budget Cuts, Deaths, and the First Anniversary of Trump’s Disastrous Budget

When President Donald Trump signed the One Big Beautiful Bill Act on July 4, 2025, the Congressional Budget Office estimated it would reduce federal Medicaid spending by more than a trillion dollars over a decade, financing tax cuts that primarily benefit the wealthiest Americans. The administration insisted the law would not cut Medicaid or endanger patients. “The OBBBA is not going to cut Medicaid,” Health and Human Services Secretary Robert F. Kennedy Jr. said in a July 2025 interview, “and there’s nobody who is going to die from this.” 

Before the law was signed, researchers had already modeled the consequences. A study in the Annals of Internal Medicine, published in June 2025, projected that coverage losses would result in more than 16,000 preventable deaths annually. A JAMA Health Forum study published two weeks after the signing reached similar conclusions. Both analyses projected that 7.6 million people would lose Medicaid coverage once the law’s work requirements and eligibility changes were fully implemented. Both were based on what would happen when individuals lost insurance. Neither could account for what would happen when states, facing new budget pressure from the law’s tax provisions, eliminated whole programs before the law’s major Medicaid provisions even took effect. 

In Idaho, that chain of consequences has become a documented fact. The state’s tax code conforms to federal law, meaning the OBBBA’s tax provisions immediately reduced revenue by $167 million that lawmakers had been counting on. The Gem State had to close the gap with the money it had on hand. 

In August 2025, Governor Brad Little, a Republican, issued an executive order requiring all state agencies to reduce their budgets by 3 percent. The Idaho Department of Health and Welfare directed Magellan Healthcare, the private company the state had hired to administer the Medicaid behavioral health benefit, to identify services that could be reduced to achieve a 4 percent net cut, according to court documents in a federal lawsuit brought by five Medicaid beneficiaries in November 2025. The beneficiaries argued the cuts violated the Americans with Disabilities Act and the Rehabilitation Act by eliminating an evidence-based mental health program without adequate alternatives. The department had chosen from a constrained menu: it could not reduce services that federal law requires Medicaid to cover, but it could reduce optional services. Idaho’s Assertive Community Treatment (ACT) program was optional. 

ACT is not a single service. Administered by Magellan Healthcare, ACT deploys a coordinated team of counselors, nurses, employment specialists, and prescribers that the state’s own materials described as “a psychiatric hospital without walls.” Teams visited patients at home, tracked their medication, and intervened when someone with schizophrenia or bipolar disorder stopped engaging with treatment. The Idaho Sheriffs’ Association warned the cuts would risk public safety. A white paper from the Idaho Association of Community Providers and the Idaho ACT Coalition estimated that $20 million in behavioral health cuts could generate more than $150 million in downstream costs for local governments.  

Nonetheless, by late October, 2025, providers received notice that, effective December 1, only two of the 20 services ACT had delivered as a unit—including medication management, crisis intervention, employment support, housing assistance, and direct psychiatric care—would remain reimbursable. Without reimbursement for the program as a whole, providers could not afford to keep the teams staffed.  

When the cuts to ACT took effect in December, 2025, approximately 200 people were enrolled in the program, according to a court declaration by Magellan’s Idaho executive director. Four of them are now dead. In court filings and press interviews, providers have attributed their deaths directly to the program’s elimination. 

The state’s response followed a consistent pattern. The Idaho Department of Health and Welfare maintained that ACT had not been eliminated, only restructured, and that services remained available through other billing codes. Governor Little attributed the broader budget crisis to “a combination of factors.” Providers who delivered ACT said both answers missed the point. The program did not work as a loose collection of billable services. It worked because mobile teams managed medication, crisis intervention, housing support, employment support, and psychiatric care together for patients who often could not navigate those systems on their own. 

Without reimbursement for those teams, providers argued, ACT no longer existed in any functional sense. Ric Boyce, Laura Scuri, and the coalition of clinic operators who filed the federal lawsuit did not dispute that Idaho’s rural behavioral health system had been fragile for years. They argued that the government’s fiscal choices turned fragility into abandonment. In their own court filing, they wrote: “We acknowledge the State’s budget challenges, which are self-inflicted by an overly aggressive tax reduction stance of the Legislative Branch and a complicit Executive Branch continuing to reduce tax revenue.” 

The question is not whether Idaho’s behavioral health system had problems before the OBBBA. It did. The question is whether removing the team-based program that actively managed risk for roughly 200 of the state’s highest-need patients made crisis and death more likely. 

“A whole bunch of people in crisis” 

The day before Thanksgiving, Boyce’s staff called ACT patients to tell them their services would end. “We were scrambling to try to get hold of these guys to reassure them that we were not cutting them off,” he said. “But all of a sudden we had a whole bunch of people in crisis”.  

By then, closures from the OBBBA were stacking up in other states, too. In September 2025, St. Mary’s Sacred Heart Hospital in Lavonia, Georgia, announced it was closing its labor and delivery unit. The hospital had spent the prior 18 months recruiting physicians and seeking new funding. “Changing demographics in our region, physician recruitment challenges, increasing outmigration for labor and delivery services, and recent congressional cuts to Medicaid solidified this decision,” the hospital said in its statement on the closure. Pregnant patients in four northeast Georgia counties now travel over an hour to Athens for care.  

“Our fear is there’s going to be highway deliveries,” said Kristy Wynn, who runs a pregnancy care center in nearby Hartwell. “There’s going to be women on the side of the road having babies and no prenatal care.” In Georgia, 45 percent of all births are covered by Medicaid; in rural Georgia, that figure rises to nearly 60 percent. St. Mary’s spent 18 months looking for a way to keep its labor and delivery unit open, and the OBBBA became the reason it stopped looking. The Georgia Recorder described the closure as one of the first casualties of the OBBBA in the state.  

That was September 2025. The bill’s major Medicaid provisions do not take effect until 2027. 

The first Idaho ACT patient who died, just weeks after the December 1 cuts took effect, was a man in his 40s with severe mental illness, but no known underlying physical conditions. He underwent a minor surgical procedure, declined follow-up care, and died from complications. ACT teams routinely support patients through medical appointments and post-surgical recovery because individuals experiencing severe mental illness often have difficulty navigating health systems.  

Boyce wrote in a court declaration that his death was preventable. “We would have had nurses catching developing post-operative infections,” he said. “Our counselors are very good at encouraging people with psychosis to engage with medical care.” Boyce also said that his clinic was investigated after the patient’s death and that the investigation specifically asked why staff had not referred the patient to a higher level of care. “The only higher level of care is hospital,” he told the Idaho Capital Sun. “And you can’t send somebody to the hospital and expect to have them hospitalized for a fairly minor medical issue. They have to become a danger to themselves or others before they can be hospitalized.”  

Without state funding to authorize or reimburse the visit, one of Boyce’s clinicians nevertheless visited the patient’s home to check on him. She arrived to find his funeral already underway. That same day, the same clinician visited another former ACT patient. She found him experiencing an acute psychiatric emergency and called for immediate transport to a hospital.  

December was not a quiet month elsewhere. Centra Southside Community Hospital in Farmville, Virginia, stopped delivering babies on December 19, citing “recently enacted reductions in federal healthcare funding.” Pregnant patients in the rural Southside region now travel more than 50 miles to Lynchburg. One Farmville mother said executives making the decision “do not live here. They will not raise children here. They will not breathe this air, drink this water, or live with the health consequences of what they are proposing.”  

On December 24, Pottstown Hospital in suburban Philadelphia closed its intensive care unit, cancer infusion center, and endoscopy unit. The ICU shuttered 13 days ahead of schedule because so many nurses had quit that it could not safely staff the unit. Tower Health, Pottstown’s parent company, cited “new Medicaid policies” among the headwinds it said made the closures necessary. Workers had protested outside for weeks, knowing what was coming. Beth Ridgley, an ICU nurse, told the rally: “That building has seen births, deaths, recoveries, heartbreaks, and miracles. For many in this community, it’s more than bricks and beds. It’s a lifeline.” Johnny Corson, president of the Pottstown NAACP and a cancer patient receiving monthly infusions there, said: “When you cut the services they have for cancer, the ICU, the next step is closure.”  

MetroHealth’s psychiatric emergency department in Cleveland Heights, Ohio, which serves a predominantly Medicaid-covered population, also closed in December. As did MercyOne Traer Family Medicine in Traer, Iowa, the only primary care clinic in a medically underserved area. In a rural area where many residents have no car, and no bus service, the 15 miles that patients must now travel to Reinbeck is just not a commute. It is a potentially lethal barrier to care. 

“Drive one or two hours when in labor” 

In January, providers reported a second ACT patient death to Idaho state officials. Idaho officials confirmed the death but declined to release details. It was the second in six weeks. Crisis center visits in eastern Idaho rose by 34 percent in December and by 43 percent in January, compared with the same months the prior year. Scuri, who co-operated the Boise ACT team, tied the surge to the loss of ACT services: “We’re getting reports from every county and every region in the state that hospitalizations are up, utilization of the crisis units is up, the jails are struggling to maintain.” 

In January 2026, the Idaho legislature was convened. Republican Representative Ben Fuhriman of Shelley, a town of under 5,000 in the state’s southeast, began working on a bill to restore the ACT program. That same month, MercyOne Des Moines Medical Center announced layoffs, citing federal Medicaid cuts, the same explanation MercyOne had given when it closed its Traer, Iowa, clinic in December. MercyOne’s Ottumwa, Iowa, clinic followed, closing in February. Its former patients now travel more than 40 miles to Centerville for primary care.  

Iowa Representative Zach Nunn, a Republican who voted for the OBBBA, held meetings with providers at Ottumwa Regional Health Center. He posted about workforce shortages on his House blog, touting $209 million in rural health funds allocated to Iowa through the law, without actually naming the law itself (which, again, he voted for). Iowa faces a projected $12.7 billion reduction in Medicaid funding over the next decade—that’s a 15.8 percent cut, the third-highest proportional loss of any state, according to a March 2026 RAND Health analysis. Iowa’s governor has already signed legislation to raise the state’s health insurance company tax rate to offset a $90.6 million Medicaid shortfall, which the state attributed to the OBBBA. Insurers have warned that their costs will be passed on to consumers in the form of higher premiums. In March, MercyOne Clinton Medical Center in Clinton, Iowa, announced it would end labor and delivery services in May, the fourth MercyOne closure or service reduction in Iowa since the OBBBA passed. 

In April, Greenbrier Valley Medical Center, the only hospital in Greenbrier County, West Virginia, ended labor and delivery services after two years of failed attempts to recruit obstetrics providers. State officials and providers tied the recruitment failure to the financial uncertainty created by the OBBBA’s projected cuts to rural hospitals. West Virginia Watch noted that all four of the state’s members of Congress had voted for the One Big Beautiful Bill Act. Charlotte McMillion, who has taught childbirth classes in the Greenbrier Valley for years, described what happens in her classes when expectant parents absorb the implications: “There’s always a point when they realize that they must drive one to two hours away when in labor, and are terrified.” Governor Patrick Morrisey said of the closure: “I don’t like it. It’s the opposite of what we’ve been trying to do.”  

The closures continued through April. Unity Health in Jacksonville, Arkansas, closed its emergency department on April 15, the only emergency room within city limits. The hospital cited the current “healthcare climate” and mounting financial losses; state Democrats placed the blame on Medicaid cuts at the federal and state levels, citing the OBBBA’s work requirements taking effect in Arkansas in January. Bradford Regional Medical Center in Bradford, Pennsylvania, filed a closure notice for its inpatient and emergency services, effective May 17. Kaleida Health, which owns Bradford Regional, cited “Federal funding cuts and long-standing financial pressures” explicitly in its press release. The hospital had lost an average of $10 million annually since 2021. Heights University Hospital in Jersey City, New Jersey, closed its emergency department on March 14. Hudson Regional Health, which operates the facility, cited losses of $74 million in 2025, Medicaid funding reductions linked to the OBBBA, and roughly 50 percent cuts to state charity care funding. In Texas, Baylor Scott & White Health Plan, part of one of the state’s largest nonprofit health systems, announced on April 14 that it would exit the Medicaid managed care market entirely, citing the financial uncertainty stemming from the OBBBA’s projected Medicaid cuts. 

This is what Medicaid cuts look like in practice. First, a hospital cannot make its emergency room pencil out. Then a rural inpatient unit files its closure notice. Then, one of Texas’s largest nonprofit health systems decides that the Medicaid managed care market overall is too risky to participate in. 

Families do not experience those losses as budget pressure. They experience them as longer drives, fewer choices, delayed care, and one more door shut when they need help. 

“Well, we’re all gonna die.” 

The third Idaho patient died in late February. He was a man in his 40s with severe mental illness who lived in the Boise area with his family. Scuri, who co-owned Access Behavioral Health Services and ran the regional ACT team, said his death was preventable. “That’s what ACT is designed to do,” she said, “is to intercede when an individual becomes symptomatic and doesn’t address their basic needs.” After the first two deaths, a reporter asked Governor Little whether he would have handled the cuts differently. “Hindsight’s a great thing,” he said. It was difficult, he told reporters, to anticipate “unintended consequences.” After the third death, Scuri told the Idaho Capital Sun: “It’s not gonna stop. I’m worried it’s gonna be a child. Some innocent kid that was in the wrong place at the wrong time is going to cross paths with someone who’s actively psychotic and get hurt.” 

None of what has happened since the OBBBA passed was unforeseen. Before the vote, there was an explicit, on-the-record argument about whether it would result in preventable deaths. 

On May 30, 2025, as constituents nationwide were becoming familiar with the costs and consequences of the bill their representatives were debating, Senator Joni Ernst held a town hall in Parkersburg, Iowa. One constituent shouted at the Republican who is retiring at the end of this term that people who lose Medicaid would die. Ernst responded: “Well, we all are going to die.” The exchange went viral. Ernst filmed a follow-up video in a graveyard to underscore the point. Senator Tina Smith of Minnesota responded on Bluesky: “I thought my job as Senator was to try to keep my constituents alive.”  

On the morning of the OBBBA vote, House Minority Leader Hakeem Jeffries took the floor at 4:52 a.m. He spoke for eight hours and 44 minutes, the longest floor speech in the history of the chamber, reading letters from constituents and naming families who would lose coverage. He said: “Hospitals will close, including those throughout rural America. Nursing homes will shut down. And people will die. That’s not hype. That’s not hyperbole. That’s not a hypothetical.” The bill passed 218-214, without a single Democratic vote.  

After the vote, HHS Secretary Kennedy gave the interview in which he claimed that Medicaid would not be cut, and nobody would die. At a Senate Finance Committee oversight hearing in September 2025, Senator Mark Warner told Kennedy directly that a rural hospital in Franklin, Virginia, would close because of the cuts. Kennedy responded: “There are no cuts to Medicaid.” Warner replied: “Sir, that is absurd.” The hospital in Franklin, Virginia, closed. 

“We don’t have a way to help” 

The fourth Idaho patient died in early March. Nurse practitioner Meredith Sievers had been his provider for the ACT team covering southwest Idaho. He was in his late 40s. He had been sober for a couple of years. He was working toward becoming a recovery coach for people with substance use disorders. After the program was cut, his visits dropped from several per week to once a week. He missed an appointment. Sievers asked around and learned he had died and failed to find answers.  

Sievers said she believed his death might have been preventable. “I don’t know the circumstances around his death, so I don’t know,” she told the Idaho Capital Sun. “Potentially, it could have been prevented if we knew more. Say it was medical, we could have been assisting him with getting to a doctor’s appointment or whatever preventive medication he would need.”  

“To have that funding pulled from us was heartbreaking,” Sievers continued, “because now we don’t have a way to help.”  

In the 18 months before the cuts, providers say one patient on the Idaho ACT program died. In the four months that followed, four died. Providers claimed in court filings and press interviews that two of the deaths were preventable: Boyce regarding the first patient, Scuri regarding the third.  

On March 23, Idaho’s budget committee voted to restore the program. Twelve days later, on April 3, Governor Little signed Senate Bill 1446 into law, formally reinstating ACT for the state’s next fiscal year (which begins this month). State health officials denied throughout the session that the ACT program had been cut at all, saying services remained available. Providers disputed this, saying what remained was non-functional; without reimbursement for mobile teams, the coordinated program that had kept 200 patients stable no longer existed in any operational sense.  

The Idaho Capital Sun described the legislative session that produced the restoration as “defined by deep spending cuts across state government to avoid a budget shortfall and make room for One Big Beautiful Bill Act tax cuts.” The legislature did not consider bills to reinstate other cut health care programs, including services for children with disabilities. The $22 million in Medicaid disability cuts Little signed on March 27 are separate from the ACT restoration. They remain the law. “When you cut revenues year after year, eventually the bill comes due, and that’s exactly what we’re seeing now,” Idaho Senate Minority Leader Melissa Wintrow said at a post-session press conference. 

Arguing for ACT’s restoration on the Senate floor, Idaho Falls Republican Senator Kevin Cook said, “We have had four deaths that you can pinpoint directly back to these programs that were done away with.”  

“The fallout is people dying,” said Representative Fuhriman, the Idaho Republican who had spent months working to restore the program. “And I don’t mean to use that as hyperbole. It’s just the reality.” Idaho Medicaid Director Juliet Charron, presenting the agency’s budget to the Legislature’s Joint Finance-Appropriations Committee as the governor proposed a further $45 million in Medicaid cuts, said: “We’ve cut through muscle, and we are down to bone.”  

An analysis by Public Citizen, a nonprofit consumer advocacy organization, published April 1, found 446 hospitals, rural facilities, and urban safety-net hospitals at high risk of closing or cutting services based on financial data from 95 percent of American hospitals. The Center for Healthcare Quality and Payment Reform estimates that 734 rural hospitals, one-third of rural facilities nationally, are at risk of closing. The named closures in this piece—Lavonia, Farmville, Pottstown, Cleveland Heights, Traer, and Lewisburg—are by no means a complete accounting. They are the ones who made the news. The rural clinic that quietly stopped accepting Medicaid patients, the psychiatric program that was restructured into a nonfunctional state, the nursing home that stopped accepting new admissions: these do not generate press releases. They generate phone calls to family members and drives that are now two hours instead of 40 minutes. As more states encounter the same constrained menu Idaho faced—cut “optional” services or violate federal law—the pattern will repeat. 

The OBBBA’s Medicaid work requirements—which data shows actually put people out of work, as Thom Walsh explained in these pages—do not take effect until December 31, 2026, eight weeks after the midterms. Administrative costs for the Supplemental Nutrition Assistance Program (SNAP), formerly known as food stamps, shift to states on October 1, five weeks before the November elections. Under the law’s implementation schedule, states were required to begin outreach to all affected Medicaid enrollees on June 30, informing them of the work requirements that take effect in December. Nebraska became the first state to enforce them, beginning May 1, eight months ahead of the federal deadline. “There’s a lot of uncertainty with our hospitals,” the Nebraska Hospital Association President Jeremy Nordquist said on April 13. “They know that there’s going to be a lot of folks who come in who just don’t know what they need to do to comply.” The law also requires states to check the eligibility of all adults enrolled in Medicaid expansion coverage every six months beginning in December, a paperwork burden the Urban Institute projects could strip coverage from between 2 and 3 million people, even among those who remain fully eligible. and does not account for marketplace losses at all. 

Four days after the Idaho budget committee voted to restore the ACT program, Governor Little signed more disability services cuts into law. The bill passed the Idaho Senate by a 19-15 vote. The state still faces an estimated $600 million to $1 billion budget gap in fiscal year 2027, and it has no plan to address the shortfall without further Medicaid reductions.