NORTHFIELD, Minn. — As farmers struggle to afford insurance, many of the hospitals they rely on in rural areas also are struggling to survive.
Minnesota received $193 million for the year through the federal Rural Health Transformation Program. Medicaid.gov says the $50 billion program included in the One Big Beautiful Bill Act "empowers states to strengthen rural communities across America by improving healthcare access, quality, and outcomes by transforming the healthcare delivery ecosystem." During an Aug. 25 visit to Northfield Hospital and Clinics, U.S. Sen. Tina Smith, D-Minn., said the money should help the state find new ways to expand rural access. But she said it falls far short of what hospitals stand to lose.
"As much money as that is, it is dwarfed by the amount of money that rural hospitals will lose because of the cuts to Medicaid," Smith said.
The One Big Beautiful Bill Act, passed in July 2025, also cut federal funding for Medicaid by 15%, or $1 trillion, over 10 years. The National Rural Health Association says rural residents are enrolled in Medicaid at higher rates than their urban counterparts, making the impact on rural hospitals and health centers particularly acute.
"Continuing existing Medicaid funding is critical for sustaining access to care in rural communities. Rural hospitals and clinics are not sustainable without this critical funding. Medicaid makes up a larger portion of rural residents’ insurance coverage, making rural hospitals and clinics more vulnerable to cuts in these programs," the NRHA wrote in April 2025, months before the OBBB act was passed.
About half of mothers giving birth in Minnesota and nationally get their insurance through Medicaid, Smith said.
She said farmers face the squeeze from both sides.
"Farmers are dealing with headwinds on so many different fronts, and many of them have to have off-farm jobs in order to get health insurance," Smith said.
For those buying on the exchanges, she said, cuts to the premium tax credit mean "money out of farmers' pockets for health care."
Asked whether rural health belongs in the farm bill, Smith said she has supported farm bill provisions to expand rural health access.
"Sometimes, if you live in a small town or a rural community, it feels like the only part of the federal government that's really paying attention to you is the Department of Agriculture," she said.
Northfield Hospital in Northfield, Minnesota, is independent and larger than most small rural hospitals. It delivers more than 800 babies a year, Smith said, with families traveling up to 100 miles.
Zander Abbott, the hospital's president and CEO, said Northfield qualifies for rural transformation dollars and plans to use them for specialty services, including telehealth. But he said the pressure is building.
"As we're looking at the reductions to Medicaid happening next year, we anticipate further reductions in how much money is coming into our organization," he said.
When revenue drops, hospitals have to match expenses to it, he said. Northfield is focused on growth, but other rural communities face tough decisions.
That pressure already shows up in obstetrics. A rural community south of Northfield ended its obstetric services earlier this year, sending 100 to 200 more families to Northfield to deliver, he said.
He said many of the hospital's patients come from farm families. "You look at our hospital here; we're in the middle of a cornfield," he said.
Patients are increasingly worried about insurance costs, copays and what's in network, he said.
Lily Vanderpol is a registered nurse and an internal organizer for SEIU, representing health care workers at facilities including the Sanford hospital in Worthington. She said the workers she represents worry about wages, retirement and their own coverage.
"Rural facilities are hit pretty hard with staffing turnover because there's just not enough community members that have the training or have the experience to fill these roles," she said.
Many facilities have turned to outside agencies, and some nursing homes have cut staffing as their census declined, she said. When local services aren't available, she said, the workers she represents travel an hour or more for care.
Lily is also concerned about hospital consolidation, including a proposed Allina-Sutter merger. She said six hospital systems control 70% of Minnesota's hospital beds.
"If you're having a heart attack, you should not have to shop around with hospitals," she said.
She said Minnesota Attorney General Keith Ellison set restrictions on a Sanford merger earlier this year and wants similar conditions on any merger now.