Eskenazi officials warn of revenue risks as Medicaid enrollment drops; HHC outlines budget tradeoffs

Eskenazi Health and Health & Hospital Corporation leaders used their budget presentation to flag significant fiscal headwinds and to explain how the 2027 plan seeks to balance immediate needs while preserving core services.

Dr. Lisa Harris, Eskenazi Health, explained that state and federal policy changes are reducing revenue streams. She cited a projected $24.6 million revenue loss tied to proposed changes in the 340B drug discount program and said a proposed state Medicaid directed payment could further reduce revenue by about $70 million under current proposals. Harris told the committee that Medicaid enrollment in Marion County has fallen about 29 percent, increasing the share of uninsured patients Eskenazi treats and worsening reimbursement pressure.

James Simpson and Paul Babcock described HHC’s broader budget approach, including drawing down the cumulative building fund to support capital projects (reducing the fund balance from a projected $81M to $29.3M in the plan) and using transfers to Eskenazi Health to support hospital operations. Simpson said the corporation aims to maintain days‑cash targets to protect bond ratings while acknowledging the multiyear sustainability challenges created by payer mix changes and inflationary cost pressures.

Eskenazi officials emphasized investments in upstream care—mental health, primary care and workforce development—as strategies to reduce downstream emergency and inpatient costs while advocating for state and federal policy relief. The committee asked for continued transparency on long‑term projections and for HHC to update the committee as funding details and state policy outcomes become clearer.