The Cost of Inaction: What Alabama Loses Without Medicaid Expansion

Our latest report shows how closing the coverage gap would save money, create jobs, and strengthen rural hospitals across the state.

Every day, Alabama families are feeling the consequences of our state’s refusal to expand Medicaid. People are living sicker, dying younger, and many people are one medical emergency away from financial ruin. Expanding Medicaid is critical for Alabamians who do not have access to affordable health care and remain uninsured.

Right now, more than 154,800 low income adults could gain life changing health coverage if Alabama expanded Medicaid. Instead, the state is losing 181.6 million dollars in 2026, money that could be keeping hospitals open, supporting mental health and substance use treatment, and helping families stay healthy.

The Cost of Inaction

When people cannot get the care they need, the entire state feels it. Hospitals take on more uncompensated care. Families fall deeper into medical debt. Communities lose workers to untreated illness. Alabama’s economy misses out on billions in potential growth.

These pressures are especially severe in rural communities. Many rural hospitals are already operating in the red, more than a dozen are at risk of closure, and emergency departments across the state are stretched thin.

Medicaid expansion would change this trajectory. It would strengthen our health care system, boost local economies, and could have saved the state an estimated 71.8 million dollars in 2026, even before counting the broader economic benefits. It would also help the workers who keep Alabama running, including people in retail, food service, child care, construction, home care and other essential jobs.

What the 2025 Federal Budget Law Means for Alabama

The July 2025 federal budget law, the OBBBA, adds another layer of urgency. It will require Alabama to lower the amount of provider taxes it collects in future years if we expand Medicaid. This means Alabama may need to raise revenue to keep Medicaid expansion funded.

Even with these changes, the benefits of Medicaid expansion far outweigh the challenges. Alabama is already losing hundreds of millions of dollars by refusing to expand Medicaid, and continuing on this path will push more hospitals toward closure and leave more families without access to basic care.

A Better Future Is Within Reach

This harm is preventable. Medicaid expansion remains one of the most powerful tools Alabama has to improve health, reduce poverty, and bring stability to families and communities across the state. It would help keep hospitals open, protect workers, and give families the chance to live healthier and more secure lives.