BOISE, ID – Idaho officials may look to tap a new rural hospital fund created in the “One Big Beautiful Bill Act” passed by Congress to increase medical training in the state.
The Idaho Medical Education Working Group — made up of legislators and medical field stakeholders — is looking to craft legislative recommendations to enhance medical education in the state and address its significant physician shortage, the Idaho Capital Sun previously reported. At the group’s meeting Monday, members discussed potentially leveraging a new tool, created by the massive federal tax and spending law, to improve opportunities for graduate medical education in rural health centers.
Those rural health systems and other small ones may also be facing more significant challenges due to the major spending reductions in Medicaid that was also included in the law.
Dr. Ted Epperly, president and CEO of Full Circle Health and a work group member, said his organization will be one of many that will be affected.
“Forty percent of our patients are Medicaid patients,” Epperly said Monday. “With the cuts that are designed to come to Medicaid, it’s going to have a significant impact on our revenue streams.”
The Big Beautiful Bill’s effect on Idaho’s medical education is unclear and mixed
Over the next decade, the bill is expected to cut federal funds for Idaho Medicaid by $4.3 billion and reduce Idaho Medicaid’s enrollment by as much as 40,000 people, the Sun reported. The reductions will come from a combination of new policies, including work requirements for some participants, increased requirements to check and renew eligibility, and removing from the rolls participants who aren’t citizens or don’t have a green card.
“The impacts and funding streams and health care now are absolutely up in the air,” Epperly said regarding the federal changes.
He said more uninsured patients mean that some hospitals will have to try and figure out ways to make up costs to treat those patients.
The working group on Monday focused on increasing the number of graduate residency programs, which doctors who graduate medical school must complete to practice medicine, to help recruit and retain more doctors in Idaho. However, hosting a residency is expensive and time consuming, speakers said at the meeting, and it’s difficult for rural hospitals to do so.
Epperly said training a graduate resident costs about $210,000 per resident per year, because “it takes a lot of people to train a resident.” When the state of Idaho developed a plan in 2017 to increase the number of residencies in Idaho, it was estimated to cost about $180,000 per resident per year — a cost that is shared among the state, the program doing the training and the sponsoring institution.
“The challenge is going to be the funding mechanism,” said Brian Whitlock, president and CEO of the Idaho Hospital Association. “And when most of our rural hospitals are operating at either a 1% or less margin, it’s difficult to find the funding within that current structure.”
Whitlock and Epperly identified upcoming funding through the Rural Health Transformation Program, created in the tax and spending bill, as an opportunity to grow residencies in rural Idaho. The fund will establish $50 billion that can go to states over the next five years; half of the funding will go out to each state in equal distributions and half will be available to apply for and will be allocated based on factors such as rural population, the proportion of rural health facilities in the state, and the situation of certain hospitals in the state, according to the website for the Centers for Medicare and Medicaid Services, or CMS.
Workforce development is one of the strategic goals of the rural hospital fund, the website said. The public can submit input to shape Idaho’s application to the Rural Health Transformation Program online through a survey until Sept. 30.
Around 58% of medical residents who train in Idaho stay in the state, according to Epperly’s presentation, which places Idaho’s retention as seventh highest in the U.S.
He told other work group members that the Rural Health Transformation Program “ought to be a mechanism by which we could put our heads together in the state of Idaho and figure out how potentially we could tap that money to help both rural hospitals and rural health systems develop GME (graduate medical education).”
Whitlock, head of the Idaho Hospital Association, said in the prior two weeks he traveled to hospitals across the state and leaders all asked about the new rural health fund.
“As we talk to every one of our hospitals, the No. 1 concern that they have moving forward for the next five years is how to recruit and retain physicians in this state,” Whitlock said. “The second is, how do we find the space and the ability to train and teach students?”
With Idaho’s rapid population growth, he said, infrastructure improvements and increased space to practice and teach should be considered for these funds.
Idaho U.S. Sen. Mike Crapo: ‘rural hospitals are in serious trouble today’
As chairman of the U.S. Senate Finance Committee, U.S. Sen. Mike Crapo, R-Idaho, was a key figure in crafting much of the final version of the tax and spending bill, including the rural health fund.
He told the Sun in an August interview that he thought the concerns about Medicaid reductions in the law were “overstated, but the concerns about rural hospitals are not overstated.”
“Rural hospitals are in serious trouble today, and nothing in the One Big Beautiful Bill on Medicaid will go into effect until 2028,” Crapo said.
He said that lawmakers opted to distribute half the funding equally to avoid concerns over a formula that may give larger sums to more populous states.
“And that was a political negotiation to help every state feel like no matter how this fund got distributed, they were going to get at least a fair share,” Crapo said.
The law didn’t create criteria for how the rest of the funds should be distributed, largely giving discretion to CMS.
He said that often the problem in rural Idaho hospitals stems from too few patients leading to low revenues.
“But these are unique circumstances in every rural part of the country,” Crapo said, “and each one is slightly different, but there are different reasons for each and one of the reasons we give this money to the states is so that they can fine tune how it is utilized in those regions and for those hospitals that are really facing the trouble.”
CMS is expected to provide states guidance for applying to grant money next week, Whitlock said, and it is expected applications will be due by November. Approval will be provided by Dec. 31.
This story first appeared on Idaho Capital Sun.