Across the backroads and small towns of Texas, hospitals are on the verge of closing their doors. The Texas Hospital Association reports that between 147 and 156 rural hospitals statewide are struggling to survive amid a perfect storm of rising costs, shrinking reimbursements, and policy uncertainty.
Advocates warn that cuts to Medicaid, Medicare, and Affordable Care Act (ACA) subsidies could tip many into permanent closure, leaving large swaths of rural Texas without emergency care.
Rural hospitals serve about 15% of Texas’s population, but they are often the only point of care for hundreds of miles. Their patients tend to be older, poorer, and more likely uninsured.
Texas has the highest uninsured rate in the nation, and in rural regions, that rate is even higher. With low patient volumes and high fixed costs, these hospitals depend heavily on Medicaid and Medicare reimbursements.
When those payments are reduced or delayed, budgets collapse.
The financial strain is already visible. Nearly 70% of Texas rural hospitals have cut services, and 40% have closed their labor and delivery units. Expectant mothers in parts of West Texas now drive more than an hour for prenatal care. Emergency departments are operating with skeletal staffing.
When a hospital closes, the community loses an average of 170 jobs and millions in local economic activity.
A 2025 report by the Center for Healthcare Quality and Payment Reform lists 76 Texas hospitals at high risk of closure, the most of any state. The consequences extend beyond healthcare: business recruitment, property values, and even school funding suffer when the local hospital disappears.
Texas lawmakers are attempting to stem the losses. The state is seeking a portion of a $50 billion federal stabilization fund earmarked for rural healthcare improvements. But hospital leaders say long-term survival depends on expanding coverage, not cutting it.
While state officials continue to reject full Medicaid expansion under the ACA, analysts estimate that doing so could bring in billions in federal dollars annually and cover more than 1 million uninsured Texans, many of them in rural counties.
Guest:
Terry Scoggin is with the Texas Organization of Rural & Community Hospitals (TORCH)
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This interview will be recorded live Tuesday, Oct. 21, 2025, at noon.
