Federal Policy Shift: Preparing Hospitals for the Road Ahead

In this episode of Value-Based Care Insights, host Daniel Marino explores the potential impact of new federal legislation, including One Big Beautiful Bill Act of 2025, which is set to reshape healthcare delivery and payment models. He is joined by Natalie Davis, a nationally recognized health policy leader who has spent nearly two decades shaping and implementing initiatives to improve access to affordable, high-quality care for all. In 2018, Natalie co-founded United States of Care, an organization dedicated to advancing health equity and ensuring care is accessible regardless of health status, social needs, or income. She also played a key role in launching Town Hall Ventures and The Medicaid Transformation Project. 

Together, they examine the implications of the legislation for hospitals across the country, highlighting both the opportunities to advance value-based care and the challenges of adapting to new funding and operational requirements. Tune in to gain insights into how hospitals can proactively prepare for change, navigate evolving financial pressures, and sustain access and quality of care particularly in resource-limited settings. Strategies are explored to help organizations achieve success while maintaining strong community impact.

LISTEN TO THE EPISODE:

 

 

Daniel Marino:  

Welcome to Value-Based Care Insights. I am your host, Daniel Marino. Very excited about today's episode. There's been a lot of discussion around the newly signed Big Beautiful Bill. It's officially called the Legislation, H.R.1. It was enacted on July 4, th of 2025. After passing the House and Senate about a month earlier. And there's a lot of discussion, a lot of chatter around what the impact is of the bill on hospitals, rural health in particular, but also our Medicaid population. There is a lot of reduction in Medicare funding that is supposed to be occurring at some point down the road. Some of that may not go into effect until 2027. But nonetheless, there's a lot of interest as to what that impact of the bill is right now on hospitals and in healthcare in general. And how do we continue to fund a lot of the activities and the programs and health care in general for our populations, especially if some of that funding is going to be decreasing.  

Well, to help me kind of work through all the specifics of the bill I'm excited to have Natalie Davis join me. Natalie is a healthcare leader, healthcare policy leader. She launched in 2018 an organization called the United States of Care, and the goal of that is to ensure that everyone in the country focuses on health equity, access to care, affordable healthcare, and so forth. Natalie has done quite a bit of work even around the Medicare Transformation Project that focuses on bringing innovation and care delivery to diverse communities. Natalie, very excited to have you, welcome. 

 

Natalie Davis:  

Great. Thank you so much for having me. I'm glad to be here. 

 

Daniel Marino:  

Before we jump into the bill, maybe you could shed a little light. What's the United States of Care? 

 

Natalie Davis:

Yeah, great. I love talking about our amazing organization. We are an advocacy organization that works on behalf of people across this country. We advocate for policy changes at the State level and the Federal level. So working with Congress and the Administration and State legislatures all across the aisle really to bring forward the healthcare change that people want, and the way we know people want it is that we go out and talk to them. We've engaged over 30,000 people across the country. Yeah, over 5,000 hours. We now have a data warehouse that's really mapping the human experience in the American healthcare system. And we're able to show really where commonalities are. When we launched the organization, we really wanted to prove that people want the same thing out of the healthcare system, and that often politics can get in the way of seeing those similarities. And so we launched the organization and had a really big job to show that there are commonalities across political parties, race, ethnicity, income, geography, etc. And I'm thankful to say that there are a lot of similarities, both within what people want, within what they love, what they hate, the language they use. And we really use all of that to drive our organization and working with all those policymakers across the country. 

 

Daniel Marino:  

Oh, that's great. Well, obviously from the work that you're doing within United States of Care, you're obviously watching impact of the bill quite closely. I'm assuming. 

 

Natalie Davis:  

Yeah. 

 

Daniel Marino:  

Let’s jump into that really quick. Give me your impression of it. Where do you see some of the biggest impact happening? Is it, you know, obviously, there's a lot of impact with regards to the hospitals, but also with patients. But from your perspective, what do you see as kind of that greatest impact? 

 

Natalie Davis:  

Yeah, I mean, when we talk to people across the country, and we are looking for the shared values and goals that people have, I can tell you that the 1st one that people have is that they want the certainty they can afford their health care. Number 2 is, they want dependable coverage as their life changes. Number 3 is, they want personalized healthcare, which means what, when, and how they want it for their bodies. And number 4 is a healthcare system that's easy to understand and navigate. And when I put those 4 values that people have across political party, race, ethnicity, all sorts of demographics, I'd say this is a really big step backwards towards what people tell us they want that they want health insurance that they can rely on, and that they can afford, that they can understand a system they can get through. And I think we're taking an enormous step backwards in giving people what they want through this. We know there are changes to limiting their ability to access and keep coverage, whether that's through Medicaid or the marketplace. Making it harder to seek and renew coverage. And you know, on top of that really shifts a big burden to States who are going to have a big maze in front of them figuring out how to work within their budgets and give people health care that they need. So we are concerned, very concerned. And I say that on behalf of people that we hear from all across the political party and other demographics, on what this bill will mean for their lives. 

 

Daniel Marino:  

So absolutely. And you know, one of the big focuses, sort of the personal mission that I have, you know, being in healthcare for almost 30 years is one helping make healthcare more accessible to really everyone, regardless of your demographic or socioeconomic makeup. But I think second is to make it affordable. So when I when I look at different aspects of the bill, I think some of the Medicaid reforms certainly has some concerns with it. I think even some of the funding to rural health care, I think, has some major challenges, and you know, when you, when we think about where CMS is going, I think you know that's sort of the 3rd area there that I think does have some concerns, at least from my perspective. Let's talk a little bit about some of those Medicaid reforms, though. 

You know it's clear that the bill is reducing a lot of the funding. A lot of that isn't supposed to come into effect until 2027. But according to some of the CBO projections they're talking about anywhere between 10 to 12 million Americans could lose Medicaid coverage. What do you feel like the impact's going to be on our healthcare industry and the ecosystem? Because, frankly, the patients still are going to need care. 

 

Natalie Davis:

That's right. That's right. And you know, we as we think about like you said just the about 10 million that are going to have impacts from these Medicaid and marketplace cuts and changes. We also know that if there's not this extension of the earned tax credit to the EPTC Extension that is in front of Congress. That's another 4.2 million that will lose affordable insurance. The marketplace rule of the Trump administration just finalized is just shy of impacting another 1 million people. So that's roughly 15 million people that will just in the last couple of months will be impacted in their coverage over the years to come. As we think specifically about Medicaid, you know, there are a lot of things that are in place that are going to really hinder people's access to get coverage and retain it. I think the biggest one that we that people I'm sure, have heard about are the work requirements, the work reporting requirements where there's more paperwork and red tape between people and the coverage that they need. This will lead to more coverage losses among people, more churn, more limited access. 

 

Daniel Marino:  

Oh, yeah. 

 

Natalie Davis:  

It really, it really just puts in that that red tape and paperwork requirements. 

 

Daniel Marino:  

And when I think about where the Medicaid, the dollars are spent delivering health care to the Medicaid population. Obviously, medical services is really big right? And that's been growing. And you know there's and we've had many conversations on this program on how to begin to address that. And community outreach is, is a great way of being able to do that and to you know, provide that care, take care of patients with chronic diseases, and then focus on a lot of those social determinant aspects. But the other area that really impacts Medicaid the Medicaid population is behavioral health. So these areas are starting to get cut. You know I can't help but think that it's going to put tremendous pressure on these healthcare providers to continue to provide a level of service that, you know, is frankly so needed. 

 

Natalie Davis:  

Yeah, I think that's exactly right. I mean, one thing is, we know that when people feel like, even if they can afford their health care. People avoid it if they feel like there's going to be extra costs. Let alone people know that they cannot afford it, they do not have insurance. We know that people are going to avoid going to the doctor. This prolongs, of course, serious illnesses, including mental health, like you just said that have a real impact on themselves, their families, their communities. It has then, of course, when they do show up, they cost more. The more uncompensated care that hospitals and health centers will take on our entire healthcare system, like you just said, is going to be really reeling from these cuts on coverage, because people like you said, still will need health care. That doesn't go away. 

 

Daniel Marino:

Yeah. It doesn't go away. 

 

Natalie Davis:  

Right, exactly. 

 

Daniel Marino:  

So let's talk a little bit about some of the impact on the rural health care setting. Because I you know, I think that a lot of these rural health care facilities, the critical access hospitals. Some of these community hospitals that are in small rural communities. They've been struggling all the way along right even without this. I mean, when you look at what the margins are on some of these hospitals, I mean, they're lucky if they're breaking even or making 1 or 2%. A lot of them are certainly in the red and being subsidized by the state or by other types of programs. What do you feel? The impact is on rural health care as a result of the bill. 

 

Natalie Davis:  

Yeah, I mean, I think people living in rural America are going to continue to be even more disadvantaged. Now with this bill, we already know, like you said that it's really hard to get access. It's really hard to access care. We have done a lot of work in rural South Carolina and talking to communities there. And one person said, you know, the biggest one of the jobs of our pastor is, if somebody has an emergency he takes them across the state line, or across the county line, I'm sorry where there's a better hospital, and so they can get picked up by the ambulance and brought into that hospital. And so we have pastors who are taking on the role of making sure people get to a hospital. 

 

Daniel Marino:  

It’s a care manager. Right? Almost care navigator, if you will. 

 

Natalie Davis:  

That's right, exactly. And it's a real sad state, you know, for rural America. And I think this is going to like you said, only have a bigger impact on that care and the health outcomes for people there, and no doubt that the providers and the health systems are going to feel that in terms of uncompensated care. There's an interesting part of the bill if you're okay with us moving into the Rural Health Transformation Fund. 

 

Daniel Marino:  

 Yeah, please. 

 

Natalie Davis:  

Which is specifically about aimed at rural health. So the OBBBA, as it's now called, has set aside 50 billion dollars fund for States to apply and receive funding from CMS to help support health centers and rural communities. I will say that this 50 billion is so small in the grand scheme of the impacts of this and the hole that rural hospitals have already been in. But the bill does set aside that 50 billion. 50% of that will be doled out to States through an application process. And 50% of that is through the discretion of this administrator. And in this case, that's Administrator Oz. And so we're still waiting to hear more information from CMS on what that looks like, both processes. And, but I think it's a real opportunity for CMS to be thinking strategically about, how can this money that'll flow through states? How can that not Band-aid over problems and not Band-aid over rural health problems that really infuse some cash to have some real transformative you know, care and care delivery. And hopefully, you know, I think there's a world in which that will point to more value-based care more, you know, incentives for hospitals and other providers to be really thinking differently about the way that they give, they give care there.  

 

Daniel Marino:  

If you’re just tuning in I'm Daniel Marino. You're listening to Value-Based Care Insights. I am here with Natalie Davis, and we are talking about the impact of the newly signed legislation, the Big Beautiful Bill, and its impact on hospitals and patients and rural healthcare in particular. So, Natalie, let's dive into that a little bit. When is some of the transformation, when is that supposed to the transformation fund? When is that supposed to take effect? And is it similar to the cost reporting that rural hospitals, critical access hospitals are doing? Or is this a separate fund? That would be maybe more value based as a program? Can you elaborate on it a little bit. 

 

Natalie Davis:

Yeah. So there's still a lot to know for sure. CMS has said that in September we will likely start hearing some of how they're thinking about this. 10 billion dollars is appropriated every year, 2026 to 2030. So 50 billion total. States must submit an application for that part, the 50% that's going to go out. And we're really hoping that, you know, this is an opportunity where you know, rural communities might catalyze payment reform or way, working better with, you know, hospitals that are in more urban areas really kind of rethinking the way, you know, less of a Band-aid approach. It'll be really up to the Administration, and how they're doing that. But it is a silver lining, we believe, of the of the bill. 

 

Daniel Marino:

Well, a lot of rural healthcare facilities have come together into some type of collaborative networks, whether they're clinically integrated networks or value-based networks, or something of that nature where they've started to really leverage different services and different support. Because I think, especially for a lot of the critical access hospitals. They certainly can't provide all the services that the patients need. So patients do have to have to begin to travel, which, you know, makes it a little burdensome for patients, but in the same respect there are community outreach programs that are essential to rural health, and I think if those are not properly funded and they go away, it's going to exacerbate a lot of the issues that we're seeing within rural healthcare and make it even more and more difficult. Almost to have these healthcare deserts, if you will, more and more difficult for patients to get the care that they need. 

 

Natalie Davis:  

Yeah, absolutely. And that's where these you know, these cuts on coverage and red tape and confusion. You know, people hate when their healthcare is a political football. 

 

Daniel Marino:

Yeah. 

 

 

Natalie Davis:

And unfortunately, I think that just happened. And so there's a lot of work that the party in power needs to be thinking about if they were serious about some of the changes they want to make now that the bill is passed. And you know, I think all eyes are to the States. The States are going to be impacted by this differently depending on if they expanded Medicaid, if they did not. What their budgets look like, you know, States can't run at a budget deficit like the government can or households can, they have to break even. And so how they're going to piece together, or cut different services, or cut other parts of their budget to shore this up will look really different. And as we've talked to legislatures and advocates across the country, they have a huge mountain in front of them that they're trying to figure out what to do in order to really make sure that the healthcare economy stays in place, and even more importantly, that patients can get the care that they need. 

 

Daniel Marino:  

We can continue to provide the services. No doubt about it. Let's talk a little bit about CMS, though. There is some aspects and impacts to CMS here. I've been watching it very close, because obviously, there's a lot of programs that CMS drives a lot of the value-based programs around the ACO, ACO reach. You know, the TEAM program just got enacted, and that looks like that's going forward. But you know, there's a number of others that are out there, particularly around Medicare. Advantage. Right? Where do you see CMS going? Where do you see, how do you see the role of Dr. Oz influencing 

some of these programs, or maybe even the future appropriation of a lot of these dollars in support of some of these healthcare additional healthcare programs or additional healthcare needs that undoubtedly we're going to need. 

 

Natalie Davis:  

Yeah. So I think you know, taking a big step back. And perhaps this is not new to your listeners, but the make America healthy again. The MAHA movement very clearly is driving everything in the healthcare space that's coming out of this administration, starting, of course, with RFK. And moving down through the different agencies. And the CMS team has taken that to heart for very clearly. And what does it look like for the levers they have, which basically is coverage. It is the largest insurer in the country. But you know there's other aspects, of course, to it, but really, mostly about coverage. How can they use their levers of coverage and payment reform to make Americans healthy is really their goal. And so, just as in the last administration we can think of equity was the big kind of lens that they had over all of their decisions. In this case MAHA and health is the big lens that they have over the decisions and will be really interesting to see how they use the coverage levers to do that. 

 

Daniel Marino:

Yeah and well, it definitely has been a big focus. 

 

Natalie Davis:  

Yeah. 

 

Daniel Marino:  

With RFK Junior. I mean, it's all around trying to make folks healthy, and I think the thought is, if you know, if they are, if they're thinking on being more healthy, that's gonna drive down some costs and make things a little more efficient. So I guess we will, we will see. So when you when you think about the bill and you think about the impacts of the bill and some of the things that we've discussed, what should hospital or healthcare leaders, or even physician leaders what should they be doing now? What should they be thinking about? Strategically, as they focus on continuing to provide the service and sort of managing their way through this unknown, of resourcing. That undoubtedly is going to happen. 

 

Natalie Davis:  

Yeah, I think the most important thing that they can do right now is be the voice of their patients and going to Congress, going to state legislatures and really making it clear how important coverage is not just to their bottom line, but to patients and to patient health, and to the health of this country and to the promise of making Americans healthy. So the biggest role I think hospitals and providers can play is really pounding the pavement and making sure that it's clear that there are fixes that need to be made, and states need to be thoughtful about how they implement this and doing such with as little burden as possible on the individuals and on our families. So that's the number one message I have for sure for the health care system. 

 

Daniel Marino:  

I wonder if we're going to see more collaboration and maybe more consolidation? You know we've already seen quite a bit of that in healthcare with a lot of the hospitals merging and private equity getting involved in that sort of thing. You know, I would think, possibly in the rural health care space, we might continue to see even more of that. And maybe there's more alignment with community health systems. Or I'm sorry, community health centers in order to maybe share resources in a way that we're able to continue to provide these services to patients. 

 

Natalie Davis: 

Yeah, I think there's a sharing of resources, I think is, you know, we should be looking at a lot of things. I will say that, you know, I think there are a lot of states that are looking very critically at consolidation when it doesn't actually help patient care and provide better quality. So you know, it'll be interesting. There are states that are really taking on this issue. There is an interest in Congress to be thinking more critically about who's investing in these hospitals? How is consolidation impacting communities? But no doubt we should be thinking innovatively about how to bring more resources and more services into rural America, into other urban areas where there are deserts as well. 

 

Daniel Marino:  

Well, you can only reduce costs so much right, and we've done quite a bit of work with hospitals all across the country, rural as well as large metropolitan health systems on financial enhancements. And I'll tell you my lesson learned over the years is you can only reduce, trim the fat so long, so much to the point where, you know there's nothing else to cut. There's nothing else to trim. The next thing you're going to cut is services. And my concern is that, especially with some of the budgetary challenges that some of the States have, if a lot of this Medicaid in particular funding goes away then they're going to be forced to cut services. And that's where I think we're going to see a lot of the uninsured population begin to even grow. 

 

Natalie Davis:  

Yeah, I think that's right. 

 

Daniel Marino:  

So if folks are interested in learning a little bit more about you, or maybe the United States of Care, where would they turn to, any thoughts? 

 

Natalie Davis:

Yeah, United statesofcare.org, you can come to our website and check out our resources. Whether that's information on how what we hear from patients across the country, including, hot tip, they hate the word value. When we talk to them about value-based care. But you could see all the research there on why, that's the case as well as the work that we do in Federal and State level. We have a newsletter that comes out every 2 weeks that I like to call it award winning, even though we haven't won an award. It actually really is a very useful, bi-weekly newsletter. And you can find me on LinkedIn, where I do talk a lot about the healthcare system and the work that we do. 

 

Daniel Marino:  

Well, I would love to hear some of the survey results that you have with patients and with the communities. Certainly, as it relates to some of the impacts of this. And it sounds like you focus a lot on education and just making sure that care is being delivered where it needs to be delivered. So I commend you on the work that you and your organizations are doing. 

 

Natalie Davis:  

Thank you so much. And thanks for having me on today. It's a really important topic. I'm glad we were able to talk about it. 

 

Daniel Marino:  

Alright, my pleasure! Do you want to give your email address, or how can folks kind of get back in touch. 

 

Natalie Davis:  

Yeah, you can find me on Linkedin, Natalie, Natalie Davis. 

 

Daniel Marino:  

Okay, wonderful. Well, thanks again, Natalie. Really appreciate you coming on board. And you know, coming on the program and sharing your insights with us. This has been great. 

 

Natalie Davis:  

This has been great. Thank you so much. 

 

Daniel Marino:  

And to our listeners. I want to thank you all for tuning in. If anyone is interested in learning a little bit more about this topic, a little bit more about the bill, or even some different aspects related to the bill. Certainly around some of the programs, theT EAM program, or any of the others. Please look up luminahp.com. Or feel free to contact me at dmarino@luminahp.com. But again, I want to thank all the listeners for tuning in special thanks to Natalie Davis. Until the next insight, I am Daniel Marino, bringing you 30 minutes of value to your day. Take care. 

About Value-Based Care Insights Podcast

Value-Based Care Insights is a podcast that explores how to optimize the performance of programs to meet the demands of an increasingly value-based care payment environment. Hosted by Daniel J. Marino, the VBCI podcast highlights recognized experts in the field and within Lumina Health Partners