12 New Jersey Hospitals Face Closure Risk After $911B Federal Medicaid Cuts

Twelve hospitals in New Jersey are among 446 facilities across 44 states and Washington, D.C., that may close, cut services, or lay off workers. Why? Federal Medicaid funding cuts. The cuts came from the “One Big Beautiful Bill” signed by President Donald Trump on July 4, 2025.

The law will slash $911 billion in federal spending on Medicaid and CHIP over 10 years. That’s what the Congressional Budget Office estimates. Public Citizen, a consumer advocacy organization, released a report identifying the at-risk facilities. They looked at Medicaid payer mix and profit margins.

New Jersey is expected to lose $3.6 billion in federal Medicaid funding each year. The state provides Medicaid to adults and children who qualify based on their incomes through NJ FamilyCare, which serves over 1.8 million residents.

Federal Medicaid requirements, approved to take effect next year, may remove 300,000 New Jersey residents from the system. State officials have warned about this. The analysis identifies hospitals as at risk if they had a Medicaid, SCHIP, and low-income government program payer mix of at least 20% on average from 2022 through 2024 and negative net profit margins over that same period.

The 12 facilities at risk include Palisades Medical Center in North Bergen, East Orange General Hospital, Inspiria Medical Center in Vineland, St. Michael’s Medical Center in Newark, Capital Health Regional Medical Center in Trenton, Bayonne Medical Center, Clara Maass Medical Center in Belleville, Trinitas Hospital in Elizabeth, Robert Wood Johnson University Hospital in New Brunswick, Monmouth Medical Center in Lakewood, Hoboken University Medical Center, and Newark Beth Israel Medical Center.

Communities served by the at-risk facilities have larger shares of Black and Hispanic residents. More people live below the poverty line there than in communities served by other facilities. Those service areas were 20.2% Hispanic and 13.3% Black on average. Compare that with 13.0% Hispanic and 8.9% Black for other locations.

“Hospitals will absorb a growing burden of uncompensated care with fewer resources to sustain it,” said Cathy Bennett, president of the New Jersey Hospital Association, according to NorthJersey.com. “What begins as a funding reduction becomes, ultimately, a public health crisis that affects every community in the state.”

Hudson Regional Health will issue notices to nearly 1,000 employees of Bayonne Medical Center by June 29. That’s based on WARN notices filed with the state this month. The organization closed Heights University Hospital in Jersey City last month after keeping only the emergency room open following a takeover.

Governor Mikie Sherrill’s budget includes $7.2 billion in state funding for NJ FamilyCare. In her budget address in March, she floated changes that would increase the burden on corporations that employ people using Medicaid.

Congress added a $50 billion Rural Health Fund to the law to “stabilize and strengthen rural hospitals and providers,” but there is uncertainty about whether that funding will be enough to prevent closures or service reductions.

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