‘A pending public health crisis’: Minnesota community health clinics brace for Medicaid changes and more uninsured patients
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At Southside Community Health Services on East Lake Street, sunlight fills a bright, spacious lobby.
The south Minneapolis clinic has served its community for over 50 years, providing care to thousands of patients, many with limited access to affordable healthcare.
But behind the welcoming waiting room, staff are preparing for changes to the federal Medicaid program that could leave thousands of Minnesotans without health insurance coverage and increase financial pressure on the clinics they rely on.
Southside serves between 11,000 and 12,000 patients each year, many of whom are uninsured or underinsured. As new Medicaid requirements approach, staff say patients are increasingly anxious about losing coverage and confused about how to keep it.
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“There’s a lot of nervousness and a lot of people trying to get their care in before cuts happen,” said Sheila Kennedy, the clinic’s medical director.
Minnesota’s 17 federally qualified community health centers are bracing for a cumulative net loss of $100 million by 2030 as federal policy changes from President Donald Trump’s One Big Beautiful Bill threaten patient Medicaid coverage and clinic revenue, according to a statewide analysis by Facktor and Capital Link, prepared for the Minnesota Association of Community Health Centers.
On July 4, 2025, Congress enacted Trump’s comprehensive tax and spending bill. This legislation is expected to increase the national deficit by over $3 trillion and is partially financed by $1 trillion in cuts to Medicaid, resulting in nearly nearly 12 million Americans becoming uninsured over the next decade.
The report from the Minnesota Association of Community Health Centers indicates that health centers will experience a decline in patient revenue due to Medicaid cuts, while also facing higher costs for the care they provide without reimbursement.
Together, Minnesota’s community health centers serve about 170,000 people annually. More than 70,000 patients who receive care at these centers are at risk of losing their health coverage because of several federal policy changes, including the expiration of enhanced Affordable Care Act tax credits, new Medicaid work requirements, more frequent eligibility checks starting Jan. 1, and and recent restrictions on Medicaid coverage for immigrants that took effect Oct. 1.
For clinics serving low-income and underserved communities, the financial consequences, according to the report, could reach far beyond insurance coverage, affecting where low-income and underserved Minnesotans can turn for primary care, medications and other essential health services.
At Southside, staff are working to help patients maintain coverage and prepare for what might happen if they cannot.
When coverage disappears, healthcare becomes urgent
Kennedy is concerned that patients who lose insurance will delay appointments, skip preventive screenings, or ration medications to make prescriptions last longer.
“They might take their blood pressure pill every other day, or every other week, or every other month,” she said.
Without regular care for conditions such as diabetes and high blood pressure, patients may become sicker before seeking treatment. Kennedy said that what could have been managed through routine appointments and medication may eventually require more complex care in an emergency department.
Illnesses, injuries and pregnancies do not vanish when insurance coverage ends, she said. Instead, people often seek treatment later, when their needs are more serious and expensive.
Kennedy added that the consequences extend beyond those enrolled in Medicaid. When patients cannot afford primary and preventive care, emergency departments become overwhelmed, impacting other patients, including those with private insurance.
“They’re ending up in the emergency room because they’re not getting their care until it’s too late,” Kennedy said.
Helping patients navigate a confusing system
Medicaid, known as Medical Assistance in Minnesota, provides health coverage for about 1.2 million residents, including children, people with disabilities and seniors. Eligibility depends on factors such as income, household size, age and pregnancy status.
At Southside, assisting patients in maintaining health insurance has become an increasingly important part of providing medical care.
Geraldine Cereceda, the clinic’s community engagement manager, supervises four patient navigators who help individuals understand insurance notices, complete paperwork and resolve coverage problems.
She says demand for assistance has skyrocketed, especially after more than 5,000 immigrants in Minnesota lost access to federally funded Medicaid coverage earlier this month. She said patients have received letters from the state or county but do not fully understand what these notices mean.
“They’re getting letters, and they have no idea what is happening,” Cereceda said.
Some letters state that a patient’s coverage has been reinstated, requiring no further action, while others warn that insurance is ending or request additional information.
For patients without computer access or an email address, or who need help navigating online accounts, it can be especially difficult. Even when a letter contains good news, Cereceda said, patients may worry they have missed a deadline or that their coverage might disappear.
Clinics face mounting financial pressure
The challenges at Southside reflect larger concerns among Minnesota’s community health centers, which depend on insurance payments, public funding and other resources to serve underserved populations.
Jonathan Watson, CEO of the Minnesota Association of Community Health Centers, said counties are dealing with significant administrative workloads as they prepare to implement new federal Medicaid requirements.
Watson described the changes as an unfunded mandate, noting that counties have been given substantial new responsibilities without adequate resources.
He said declining Medicaid revenue could force health centers to scale back dental and behavioral health services, and some clinics operating in greater Minnesota may even consider closing certain sites.
While Watson does not expect immediate closures, he said that some centers may reduce services over the next several years.
Such cuts could have broader consequences, he added. If patients lose access to preventive care, many may turn to emergency departments and hospitals for treatment, ultimately increasing health care costs.
Southside prepares for what's ahead
Ann Cazaban, Southside’s executive director, said the clinic is already under considerable financial pressure. About 33 percent of its patients are uninsured, and she anticipates this percentage will rise as federal policy changes take effect.
Southside offers reduced fees based on income and family size, and the staff helps eligible patients apply for insurance. But these resources are limited.
Cazaban said the clinic cannot absorb unlimited additional costs while caring for an increasing number of uninsured patients.
“At the end of the day, community health centers are here to provide care for people,” Cazaban said. “Instead of focusing on making sure people are healthier, we're focusing on who's doing paperwork and who's getting the paperwork and who's checking all the boxes exactly the right way, instead of making sure people get care, so they're healthier and more productive members of society.”
For now, Southside continues to assist patients in understanding their options and maintaining health insurance coverage whenever possible.
But Kennedy said the consequences of losing access to health insurance and preventive care affects the entire community.
“Federal budget changes and policy changes have public health impacts on thousands and thousands of people,” Kennedy said. “And it will impact everybody in the community, whether they use Medicaid or not. This is a pending public health crisis in the making, and we're watching it happen right now.”
