Jefferson Healthcare CEO Mike Glenn warns that proposed state and federal budget cuts and tax changes would severely impact rural hospitals, including Jefferson Healthcare, by threatening vital services and access to care. He urges lawmakers to protect healthcare funding to preserve community health and economic stability.
April 30, 2025
This article was originally published in the Peninsula Daily News on April 23, 2025.
By Mike Glenn
Say what you want about the efforts to downsize the government in Washington, D.C., and balance the budget in Olympia, but make no mistake, healthcare is in the crosshairs.
The reductions to healthcare being weighed in both Washington, D.C., and Olympia will have devastating impacts to rural communities and rural hospitals, including Jefferson Healthcare.
Washington state’s healthcare system is fragile, and hospitals remain one of the last safety nets.
Public hospitals are committed to treating anyone who comes through our doors, regardless of ability to pay. But this commitment means additional strain on already lean budgets. And our impact extends far beyond the care we provide.
Hospitals are economic anchors that help sustain communities by providing living-wage jobs with excellent benefits.
Jefferson Healthcare employs 970 people and generates more than $90 million in payroll. That amounts to $250,000 of payroll a day being dispersed throughout our community to support local households and businesses.
However, looming cuts, takeaways and new tax proposals threaten to harm this safety net and make healthcare harder to access for everyone.
Budget proposals currently under consideration at the state level would reduce resources for hospital services by nearly a half-billion dollars.
These budget cuts and new tax proposals come at a time when hospitals have little to no financial cushion to absorb them.
Recovering from the financial impacts of the pandemic has been a significant undertaking, as we have seen skyrocketing costs in pharmaceuticals, supplies and labor over the last four years.
Those increasing costs have slowed but show no signs of stopping. The picture in Washington, D.C., is much more ominous.
The budget recently passed by the House of Representatives includes $880 billion in cuts from the House Energy and Commerce Committee.
The only way these reductions can be achieved is through draconian cuts to Medicaid and Medicare programs.
Medicaid covers about 1.8 million people in Washington, including 24 percent of residents of the 6th Congressional District (Kitsap County, North Olympic Peninsula and parts of Tacoma).
The proposed cuts would disproportionately impact older, poorer communities like ours, where 80 percent of patients are covered by public programs like Medicare and Medicaid, which systematically reimburse hospitals at levels below the costs of providing care.
If these cuts are signed into law, small rural hospitals like Jefferson Healthcare will have no choice but to consider reductions and even elimination of some vital services our community has grown to rely upon.
According to a recent study by the Center for Children and Families, Medicaid cuts will hit rural areas hardest.
Nationwide, 18.3 percent of Medicaid-eligible residents live in small and rural towns, compared with 16.3 percent living in metro areas. And in the six most rural states, more than half of children living in small towns and rural communities are covered by Medicaid.
Medicaid is now a middle-class benefit, covering families across the economic spectrum, including nearly half of the births occurring in our state.
As we have learned before, cutting access to Medicaid is a penny-wise, dollar foolish fiscal policy, placing the lives of residents and the health of communities on the line.
I have been a hospital administrator on the North Olympic Peninsula for 30 years, and this is the most challenging fiscal environment rural hospitals have faced.
Jefferson Healthcare is concerned about maintaining services if the proposed level of payment reductions and increased taxes are included in the final budget.
We have a long history of facing down and overcoming financial challenges while continuing to expand and improve services. However, the reductions being contemplated are so deep that their impact to services will affect all patients. Scheduling and wait times will increase for many services while others face being cut altogether.
With increased barriers, people will stop seeking necessary care, and that will result in a busier and fuller emergency room and worse health outcomes for many.
We understand Olympia is grappling with a deficit, but balancing the budget with cuts to hospitals is not only short-sighted but will result in harm. We are committed to providing the healthcare services our communities need and deserve but need help from lawmakers in Olympia and Washington, D.C., to do so.
Our message to lawmakers is this: Hospitals have been there to take care of your communities; we now call on you to take care of your hospitals.
Jefferson Healthcare is an award-winning, full-service healthcare organization meeting the care needs of East Jefferson County. Jefferson Healthcare offers inpatient and comprehensive outpatient services including primary and specialty physician care.
