A total of 101 nonunion employees at Valley Medical Center in Renton were laid off on March 25 due to an abrupt end to the hospital’s Medicaid, or Apple Health, reimbursements.

According to Valley Medical communications director Kristin Bidwell, the firings were “excruciatingly tough, but necessary for Valley’s viability” and that they “affected individuals from across the organization in non-clinical, support, leadership, and ancillary departments.”

“As a public district hospital, 64% of Valley’s reimbursement for care provided is from federal or state funding sources, so reductions disproportionately impact us,” said Bidwell.

In fall 2024, the state of Washington applied to continue the Medicaid Directed Pay Program (DPP) — an option to “help states close gaps in payment between Medicaid and other payers” — through the federal government for the 2025 calendar year.

In February 2025, the Washington State Hospital Association (WSHA) reported that the program had not been renewed by Jan. 20, 2025, and that the current administration has not approved the program for 2025.

“We learned in February that federal Medicaid reimbursement we depend on ended abruptly on Dec. 31, 2024, with no notice or time to plan,” said Bidwell in an email. “It has not been renewed for calendar 2025 and equals an estimated $80M-$100M per year to Valley.”

The program would have been a net benefit of $6.5 million a month to Valley if it had been renewed. According to Bidwell, there is no indication that there will be a renewal and that Valley had “paused on non-mission critical projects, positions, and programs” like IT or construction-related projects and that the hospital is “actively working to identify areas for cost savings.”

“The reduction in positions affected individuals from across the organization in non-clinical, support, leadership, and ancillary departments,” said Bidwell. “We do not expect patient care will be impacted.”

According to a March 6 article from WSHA, 1.9 million people rely on Apple Health in Washington, around 800,000 being children.

“Cuts from the federal government could result in loss of coverage for Apple Health patients or a reduction in their covered services,” said WSHA communications director Tim Pfarr.

The article also talked about health care cuts at the state level, including Senate Bill 5083 which “caps payments to hospitals for care provided to teachers and state employees who get their health insurance through the Public Employees Benefits Board (PEBB) or the School Employees Benefits Board (SEBB).”