Hospital association warns of “perfect storm” for Minnesota health care
A number of Minnesota hospitals are facing financial distress. Thirty-one of 140 hospitals and health systems across the state are operating with single-digit days of cash on hand, compared with the national average of 119 days. Hospitals are struggling to make payroll or afford supplies, and the situation could force some facilities to scale back services or, in some cases, close.
The affected hospitals include both urban and rural facilities, as well as independent organizations and those that are part of larger networks. Many are seeking bank loans or other financial lifelines to remain open.
“We’re seeing kind of really the perfect storm in health care in Minnesota this year,” Greg Ruberg, president of Aspirus Lake View Hospital and board chair of the Minnesota Hospital Association, told WTIP. “You can turn on the news, you can open up a newspaper, listen to the radio — it’s all over.”
The issues straining hospitals are multifaceted, but Ruberg said they begin with Medicaid and Medicare reimbursement. Government payers currently reimburse hospitals for only a percentage of the cost of services provided, with commercial insurance intended to cover the remainder. However, some hospitals have faced reimbursement delays. One Medicaid and Medicare provider, UCare, shut down operations last year, and while some services were transferred to Medica, hospitals — including North Shore Health — are still waiting on significant payments.
There were a couple of recent stories about hospitals in the state that had an issue with their Medicare reimbursement, and when those reimbursements stopped flowing, those hospitals were really struggling to make payroll,” Ruberg said. “So hospitals are trying to find a path forward again, trying to find ways to stabilize reimbursement, trying to cut expense, trying to find other creative ways to kind of navigate really, which is a very difficult financial position.”
Ruberg praised North Shore Health during the April board meeting for an IRS reimbursement of nearly $900,000. The reimbursement and other efforts have kept North Shore Health in good financial standing.
However, hospitals are also worried about future financial pressures. In 2027, Medicaid cuts tied to House Resolution 1 are expected to take effect, potentially resulting in 140,000 Minnesotans losing Medicaid coverage. Hospitals warn the loss of insurance could increase uncompensated care, leaving providers without reimbursement for treatment patients cannot afford to pay for.
“If 140,000 Minnesotans lose Medicaid coverage, starting in 2027, those patients are still going to have heart attacks. They’re still going to have strokes, they’re still going to be involved in car accidents, and bad things are going to happen medically, and they’re going to have to receive care,” Ruberg said.
In the short term, Ruberg and the Minnesota Hospital Association are advocating for lawmakers to avoid additional cuts or measures that could place more pressure on hospitals. Many facilities, including North Shore Health, are operating on thin margins or at a loss, while other parts of the health care industry remain highly profitable.
“If you look at some of the other key stakeholders, they have significant profits from their operations,” Ruberg said. “Look at big pharma. Look at some of the big commercial insurance companies.”
Ruberg said the Minnesota Hospital Association is also continuing to explore long-term solutions to address challenges facing the industry.
“We’ve got to provide this care that people trust us to deliver,” Ruberg said. “But also look long-term strategically at how we transform the industry.”
Josh Hinke May 14, 2026
