When Medicaid Disappears: How Cuts Could Devastate Behavioral Health Care in Rural America

Summary

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Advancing Health Podcast Summary

Episode: When Medicaid Disappears: How Cuts Could Devastate Behavioral Health Care in Rural America
Date: July 2, 2025
Host: Rebecca Chickey, Senior Director of Behavioral Health, American Hospital Association
Guest: Dr. John Olvan, Chair of Psychology, Sanford Health

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Episode Overview

This episode delves into the critical role Medicaid plays in supporting behavioral health services in rural America, focusing on the challenges that rural health systems like Sanford Health face, and the devastating impact proposed Medicaid cuts could have on patient care. Dr. John Olvan offers both data and personal stories to illustrate how access to care—especially for behavioral health—is inextricably tied to Medicaid funding, particularly in frontier areas where resources are scarce and stigma remains a barrier.

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Key Discussion Points and Insights

1. The Challenge of Delivering Behavioral Health in Rural America (00:25–03:50)

• Sanford Health’s Reach: Sanford operates across multiple Midwest and frontier states, covering about 2 million patients in highly rural areas, many classified as “behavioral health shortage areas.”
• Barriers to Care:
  • Provider shortages: Difficulty recruiting behavioral health professionals to remote regions.
  • Extreme travel distances: Patients may travel hours for appointments.
  • Loss of Anonymity and Stigma: In small communities, privacy concerns deter people from seeking behavioral health services.
    • “Everybody knows everybody's business, so it makes it really hard to reach out and seek care.” – Dr. Olvan (03:20)

2. Virtual Care and Infrastructure Solutions (04:21–07:37)

• Broadband and Technology: Sanford Health has heavily invested in virtual care to reach remote patients. Currently, about 1 in 5 behavioral health visits are virtual.
• Hybrid Models: Combination of virtual and in-person care, with creative solutions such as minimally staffed clinics offering telehealth in tiny towns like Lidgerwood, ND.
  • “If they have difficulties with their technology…we offer [virtual care] up to people at the clinic.” – Dr. Olvan (06:30)
• Comprehensive Care Approach: Integration of behavioral health with primary care, pharmacy, women’s health, etc.

3. Medicaid as a Lifeline in Rural Communities (07:37–12:02)

• Funding Mechanism: Medicaid is the largest payer for behavioral health services in rural areas.
• Impact Stories:
  • Dr. Olvan shares a case of a young, uninsured patient experiencing their first psychotic episode, who, through Medicaid, accessed medications, therapy, and primary care.
    • “If we can help this person out at that point on an early basis, we are really…bending the trajectory for their health throughout the course of that person's life.” – Dr. Olvan (09:45)
• Significance of Early Intervention: Early Medicaid-supported intervention leads to better long-term outcomes for patients.

4. The Real-world Impact of Medicaid Cuts (12:02–14:45)

• Dependence on Medicaid:
  • 50% of rural children and 18% of adults are covered by Medicaid. (11:33)
  • Foster children heavily rely on Medicaid for behavioral health coverage.
• Consequences of Cuts:
  • Loss of coverage would create dangerous gaps in care, especially for vulnerable populations.
  • States with Medicaid expansion have lower suicide rates and fewer psychiatric hospitalizations.
    • “In one study they looked at suicide rates … literally thousands of lives, they could see a reduction in completed suicides, which would suggest that there were thousands of lives saved.” – Dr. Olvan (13:09)
    • Telepsychiatry with Medicaid recipients showed a “38% reduction in inpatient hospitalizations, 18% reduction in emergency department visits.” (13:44)

5. Call to Action and Advocacy (14:45–17:49)

• Importance of Advocacy: Clinicians and citizens must get involved with policymakers to preserve and expand Medicaid.
  • “We all are responsible—whether in a healthcare setting or our elected officials—to improve the lives of the patients and the citizens of our states…and in a bipartisan way when we can get some things done that are truly meaningful.” – Dr. Olvan (16:43)
• Emphasis on Children and Preventative Care:
  • Children with Medicaid are four times more likely to have regular pediatric visits—paving the way for effective early intervention.
  • Adults on Medicaid are also more likely to get preventive care and maintain regular healthcare sources.

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Notable Quotes & Memorable Moments

• On Stigma and Seeking Care:

  • “Everybody knows everybody's business, so it makes it really hard to reach out and seek care.” – Dr. Olvan (03:20)

• On Early Intervention:

  • “We are really, in some ways, bending the trajectory for their health throughout the course of that person's life.” – Dr. Olvan (09:45)

• On Medicaid’s Reach:

  • “50% of the kids in rural communities are covered by Medicaid and 18% of adults. Medicaid is also the largest payer for behavioral health.” – Rebecca Chickey (11:33)

• On Data Supporting Medicaid Expansion:

  • “In one study…folks who had access to Medicaid expansion, suicide rates go down…thousands of lives saved.” – Dr. Olvan (13:09)
  • “There was a study...participating in this telepsychiatry practice…a 38% reduction in inpatient hospitalizations, 18% reduction in emergency department visits.” – Dr. Olvan (13:44)

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Timestamps of Key Segments

• 02:00–03:50: Rural barriers; provider shortages, stigma
• 04:21–07:37: Virtual care platforms and hybrid clinic solutions
• 08:08–10:27: Patient story on early intervention and Medicaid’s role
• 11:33: Statistics on rural Medicaid coverage
• 12:02–14:45: Medicaid cuts’ impact on special populations; research studies
• 15:19–17:49: Call to action, advocacy, and the importance of bipartisan solutions

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Conclusion

This episode highlights that Medicaid is critical for behavioral health services in rural America—not just for individuals, but for the sustainability of entire rural health systems. Medicaid supports early intervention, reduces crises, and enables innovative care delivery in hard-to-reach areas. Proposed cuts threaten to unravel progress, with potentially devastating impacts on children, foster youth, and all rural residents needing behavioral healthcare. The call: Listeners, practitioners, and policymakers alike must advocate fiercely to preserve and expand Medicaid for the health of rural communities.

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Transcript

[A]

Welcome to Advancing Health. South Dakota based Sanford Health is the largest rural health system in the United States. Yet even with its size and resources, there are many challenges to delivering the care that patients need, especially regarding behavioral health services and the threats to care posed by cutbacks to Medicaid.

[B]

Hello, I'm Rebecca Chickey. I'm the Senior Director of Behavioral Health at the American Hospital association and is my great honor to be here today with Dr. John Olvan, who is chair of Psychology of Sanford Health, which is the largest rural health system in the country and covers North Dakota, South Dakota, Minnesota and probably parts of the country that are very small and rural surrounding those states. So, Dr. Alvin, thank you so much for joining us today for this very important topic serving and meeting the mental health needs of rural Americans and particularly the intersection of that with patients who are covered by Medicaid. So to set the stage, I'd love to have you share a little bit about Sanford Health, what it's like to really, I say rural, but you're in frontier states for the most part. So the vastness of north and South Dakota and what that does to create challenges in terms of access and the solutions that you've had to come up with, but help the listeners understand the barriers.

[C]

Yeah. So first of all, just thanks for having me and I really appreciate the attention to this really important topic. You mentioned a few states, but I'm just going to mention a few more states that we cover, Rebecca, because we're also in Wyoming, Iowa, Wisconsin and in the Upper peninsula of Michigan. We have a very, very large footprint for our organization and we serve about 2 million patients in that area. We do a lot of work with very rural areas. As you were mentioning, frontier type states in North Dakota and South Dakota. Most of those counties are known as behavioral health shortage areas. I practice primarily in Morehead, Minnesota, and in the state of Minnesota, about 80%, 80 to 85% of our counties are known as a behavioral health shortage. So we have just a very unique set of challenges when it comes to the trying to provide world class healthcare and behavioral healthcare to a footprint that size. And when we look at the rurality of the folks we serve and so things that we often encounter, we counter pretty much persistent challenges with provider shortages. It's hard to recruit to this part of the country. We're in a perpetual state of recruitment. And we also know that a couple of unique things that happen with rural areas, we have people who can travel for literally some of I've seen patients who travel across the state of North Dakota to come to an appointment on the eastern side of the state. So there are sometimes some very legitimate transportation challenges. And then also I think one of the things that is when you're in a small rural community, and I know because I grew up in one, I actually grew up about 25 miles from where I am, right here in Moorhead. I grew up on a farm. There's some nice opportunities for connectivity in a rural setting, but there's also you lose anonymity. So you have challenges with people who might need behavioral health services. But everybody knows everybody's business, so it makes it really hard to reach out and seek care.

[B]

I hear you. I grew up in rural Alabama, and it took 20 minutes to get to the closest gas station, and 20 more minutes from that to get to the closest hospital. So perhaps not quite as rural as yours, but you got the fact. And everyone in the little community I grew up in knew everyone else's business. And with that comes the stigma of seeking care. It's incredible. That's one of the things we've been working on. So glad you're working on it too. What about broadband? Can you speak to that for just a minute?

[C]

Yeah. So to try to meet this behavioral health need, Sanford has invested a tremendous amount of infrastructure and time into a virtual care platform that we offer for this footprinted area that I described a little bit earlier, where currently we have about 1 in 5 of our behavioral health visits are virtual at this time. So people can access this through their phones, through their computers at home. And we offer a confidential service where we are able to, with the technology throughout that footprint, be able to deliver that type of care. And it's something that we are training our clinicians on a regular basis about the effective ways to provide this modality of care. I think in all of our areas, this has just become a pretty common way of life for us to do care that we have a certain portion of it that's versatile.

[B]

And so you complement that with in person visits. I assume we do.

[C]

Like I said, about one in five of our visits are virtual. I really have appreciated some of the innovative minds that we've had here at Sanford to do some unique things. Like, for example, we have a very small community. The name of the town is Lidgerwood, North Dakota. And in Ledgerwood, North Dakota, which is, like I said, I grew up around here, so I remember playing basketball. And Winterwood, just this very, very small community. And if you head to that town, what they have is they had a clinic setting there, but it was nearly Impossible to keep that staffed. So now what we've done is we have some bare bones medical staff in that area. We have some imaging capabilities and we have people to check patients in as they come in. And then they can do virtual care from there. And so they can do all different types of virtual care. They could be there for a checkup with their primary care physician, they could be there for a specialty visit for one of our other departments, and they could do behavioral healthcare from there as well. So we're trying to have both kind of this nice opportunity for people to have where they can go to a location if they need, if they have some difficulties with their technology. And so they can't do the virtual care themselves that we offer that up to people. And in this building that I'm in right here in moorhead, we have 17 psychologists and master's level therapists. We have psychiatry here, social workers, nursing staff. And then within our building we have family medicine, internal medicine, women's health, pediatrics, we have a lab here, we have a pharmacy here. So we have this nice opportunity to provide just a really well rounded amount of healthcare to tie back into the connecting with what we're all here for. It's talking about the, you know, our ability to do that type of care, to think that way and to provide this platform of care. A lot of it has to do with, in our country, the ways that we pay for health care. And that's where we get into what has been a mainstay for health systems, and especially when we think about rural health systems, is the services that are allowable by Medicaid.

[B]

I want to get back to that point, but before we go further about the devastating cuts that are being discussed right now, help the listeners with a couple of stories if you can. What has been so your ability to provide these services, your ability to provide access to care virtually or in person by being creative around that clinic that was probably on the verge of maybe closing and not being there in that community. What are some of the personal stories you've seen that have impacted the lives and how.

[C]

Oh, I have many stories that I could share around this. I've been here with Sanford for 21 years. I'm a licensed psychologist and as you were saying, I'm the department chair of our adult psychology group. So I often feel like a jack of all trades and a master of none. But what I do is I do some hospital based coverage from time to time. And so we have an inpatient psychiatric unit that I will occasionally provide care for. So A very common course that we would see would be somebody who is uninsured or underinsured, and they end up coming through our emergency department for a mental health crisis. And while they're there, the team with our emergency department determines that the patient needs hospitalization. In our inpatient psychiatric unit, patient is admitted there. While they're there, we might uncover, for example, a first episode psychosis. So if you take someone who is a young individual in one of our communities who is having an onset that might lead to schizophrenia diagnosis, they're having a first episode of psychosis. And so we have the opportunity to assess the person there, start the person on antipsychotic medications, and then let's say that we also uncover that this person has a substance use disorder. Well, we have had the opportunity to enroll this person in Medicaid. Perhaps this person is unemployed, underemployed, has a position where they just don't have the benefits to have the standard type of health care that a lot of us are able to have. And so we get this person on Medicaid and what we're able to do from our inpatient unit is set this person up with a primary care provider, a psychiatrist, a therapist, and we are able to do things like get this person started on some medication that might help with cravings for substance use. And we can also work with some of our community partners to try to get this person engaged in that care. What I often think about is just that early intervention, that we know that if we can help this person out at that point on an early basis, we are really, in some ways we're bending the trajectory for their health throughout the course of that person's life. And it is such an important time.

[B]

That'S phenomenal for the listeners. Statistically, by the age of 14, probably about 50% of the population, if you're going to show or have a psychiatric or substance use disorder, those symptoms are showing by the age of 14, and correct me if I'm wrong here, keep me honest, but then by the time you're 21 to 24, we're up to 75%. So that early identification and intervention and treatment, there's so many opportunities to improve the long term health of the individual, their ability to have a joyful life, to engage and be productive and make the most of the resources around them. It's just critically important. And your being there is equally so.

[C]

Thank you for that. You know, as we're having this conversation, that when we hear stories like this, sometimes the tendency as humans to just Say, oh, that's nice and it's important to hear about that. But it's, it's a bit abstracted from us. If we don't have the ability to treat that type of individual. We see is, we see diminishing services across the board.

[B]

Research shows that 50% of children and 18% of adults in rural communities are covered by Medicaid. Let that sink in, Listers. 50% of the kids in rural communities are covered by Medicaid and 18% of adults. Medicaid is also the largest payer for behavioral health. So speak a little bit more about the impact of these Medicaid cuts that are currently being discussed in Congress and what that would mean for your community.

[C]

Yeah, thank you for that. And just as you were saying that, just another, I think another example just comes to mind for me. And that's the, that's the example. That's something that I think a lot of people don't think about. And that's, that's healthcare coverage for foster kids. For foster children. So if you think about that for a moment, you're a family and who's taking on a foster child? We don't allow that those folks to go under the foster parents insurance. There's a gap, there's a gap in care that is consistently filled by Medicaid. And if we think about some of the folks that even if our listeners can think about some situations where they think a foster child would come from a situation, they're obviously coming from a situation that is a distressing and challenging situation. Often there are lots of different health related issues, including mental health issues. Essentially these folks would possibly be in a situation where they would have no care, no access to care. And we know some things about looking at places, for example, where Medicaid expansion has hit a certain area and we can take a look at some big numbers about, like what's the impact of that? And we know, for example, that in one study they looked at suicide rates of the rate of suicide and it was over a course of many years and found that folks who had access to Medicaid expansion, that suicide rates go down. In the study that they looked at over a series of years, literally thousands of lives, they could see a reduction in completed suicides, which would suggest that there were thousands of lives saved. I'll also offer just a more pragmatic one. There was a study that was out of Montana that looked at a group of people who were participating in a telepsychiatry practice. A large number of these folks were Medicaid recipients. And what they found was that participating in this telepsychiatry practice they had a 38% reduction in inpatient hospitalizations, 18% reduction in emergency department visits. So if you think about the higher cost elements of healthcare, when we can invest in ways that we know have evidence, support, are effective, get the job done, we're actually preventing some of that higher cost care that truly is. I would much rather work on preventing something from getting worse than what ends up happening when people are at that level of distress, when they make it to our emergency department or when I'm covering on our inpatient unit. And I can see that I'm working with someone who has gone without care for a significant amount of time again.

[B]

Going upstream, early intervention, prevention, treatment, rather than waiting for the crisis, which might not only just impact the individual, but others as well, depending upon what the crisis is and how many people show up to the emergency room. So as we draw this podcast to a close, is there a call to action that you would share with the listeners? Is there something you would like to encourage them to do or the last thing that you want to make sure that they resonates as they click off to this podcast?

[C]

My heart often goes to children. I only work with adults in my practice. But I mean I'm a father myself. I think about that just that point you just made. The earlier we can intervene the better. And I think it's important that one study found that the children who have Medicaid coverage, they're four times more likely to have regular visits with like pediatrician or get some some of their health care needs met and that includes behavioral health and that they're two to three times more likely to receive preventative care. And then we think about when it comes to adults who are enrolled in Medicaid that they're five times more likely to have a regular source of health care and also receive preventative care. From the listening perspective, I hope that what this has done is just increased an awareness to the truly wide reaching effects that a change in Medicaid is going to, it's going to have for the way that we deliver health. And I would say especially in rural health care, rural health care systems are routinely much more impacted by non reimbursable care. And so you add to that we're going to see some pretty significant reduction in services. Would be a, would be I think a reasonable guess the thing that like call to action. I think one of the things I'm so, I feel so privileged about in that in North Dakota. I'm a I'm a citizen of North Dakota. I practice in Minnesota, right on the border. Because we're in a small state of North Dakota, I have been able to work with our government support people and been able to testify. We had the last two legislative sessions. We have had laws changed in the state of North Dakota. That's been a great opportunity through connections of me. Here's me as a psychologist working with our legislators. We all are responsible in a healthcare setting or our elected officials to improve the lives of the patients and the citizens of our states and in a bipartisan way when we can find some nice opportunities to get some things done that are truly meaningful for people in the states we serve, it's a win for everybody.

[B]

That's phenomenal. Thank you. Your passion for this work, both for the patients that you serve, for the organization that you work for and with, and for having an impact more globally, it resonates throughout this entire podcast. So thank you for that passion for bringing it to the work that you do, and thank you for sharing it with the rest of the field.

[C]

Well, thank you very much.

[A]

Thanks for listening to Advancing Health. Please subscribe and rate us five stars on Apple Podcasts, Spotify or wherever you get your podcasts.