Why The One Big Beautiful Bill Act should be the catalyst for rethinking your workforce strategy 

The healthcare industry has been under mounting pressure for decades. Long-standing challenges—an aging population, escalating wage demands, the rising costs of medical innovation, and heightened patient expectations—have made stability a constant struggle. Since the pandemic, talent shortages have only intensified, pushing an already strained system to its limits. Recent developments, most notably the “One Big Beautiful Bill Act” (OBBBA), are adding another layer of financial complexity for hospitals and health systems already operating on thin margins.

The instinct in times like these is often to respond with across-the-board cost-cutting. But history has shown that reactive measures rarely address root problems and frequently undermine long-term stability. What’s needed is more than budget trimming – it’s a proactive transformation of how we plan, manage, and finance the healthcare workforce. The reality is that some may conclude it is no longer financially sustainable to serve certain patient populations. Rural care, academic medicine, children’s services, senior care, and other specialized or underserved markets now stand at a tipping point, confronting challenges that are more complex and nuanced than ever before.

Hospitals and healthcare systems today face a multifaceted economic squeeze. Top strains include:

Taken together, these forces create a dynamic that threatens both operational stability and the ability to invest in innovation. And now, the OBBBA has entered the scene.

The OBBBA is the latest shift that could impact healthcare’s financial equation. While details may not be clear in all areas, at its core, the bill changes the funding and reimbursement landscape in ways that could put additional strain on providers. 

Mercer’s sister strategy firm, Oliver Wyman, has analyzed the OBBBA and developed an interactive calculator to model its potential financial impact on health systems. The tool provides state-by-state projections of coverage loss and lets users adjust factors such as payer mix, cost structure, and reimbursement rates.  

OBBA may be an accelerant to today’s challenges, tightening cash flows, and increasing the urgency of needed systemic change. 

While the financial and operational pressures are undeniable, they also create an opening for leaders willing to reimagine their operating models. With about half of a typical provider’s operating expenses tied to people, representing by far the most significant cost year after year, addressing workforce dynamics is central to long-term stability. This is a moment to move beyond crisis management and use data, technology, and innovation to drive sustainable change. 

We recommend the following key strategies:

• Workforce analytics to identify gaps and forecast needs 
  By integrating HR, scheduling, and clinical data, organizations can map workforce capacity against demand and use predictive models to anticipate shortfalls before they affect care.
• Predictive scheduling to reduce burnout 
  Predictive modeling can generate shift schedules that balance patient demand with staff well-being. Predictive scheduling can improve morale and also reduce turnover – a major cost driver.
• Real-time resource allocation 
  Using live operational dashboards can enable rapid redeployment of staff and equipment based on patient volume surges or acuity changes.
• Technology adoption and automation 
  From AI-driven triage tools to robotic process automation for administrative tasks, technology can free up clinical staff to focus on patient care, improving both productivity and satisfaction.
• Work redesign 
  Work redesign means rethinking how work is structured and who is best equipped to do it, reducing costs, increasing productivity, enhancing employee satisfaction, and redesigning high-incumbent roles to improve efficiency and optimize the cost model.

When implemented together, these data-driven approaches can produce measurable gains: better patient outcomes, higher staff engagement, reduced turnover, and a more resilient financial footing.

Continuing to respond to budget pressure solely with cuts, particularly in workforce and innovation, poses serious long-term risks, including:

• Quality erosion through reduced staffing levels and deferred investments will inevitably affect care quality and patient safety.
• Staff burnout and turnover create a costly cycle of recruitment and training.
• Patient dissatisfaction from longer wait times, reduced service availability, and inconsistent care experiences may drive patients elsewhere.
• Financial instability from short-term savings from cuts can lead to higher long-term costs due to inefficiencies, errors, and lost revenue opportunities.

Inaction, or the wrong kind of action, locks healthcare organizations into a downward spiral that becomes increasingly difficult to reverse.

The path forward requires a shift from reactive cost-containment to proactive transformation. We recommend healthcare leaders:

• Invest in advanced analytics and workforce planning 
  Build the capability to forecast demand, model staffing scenarios, and identify where interventions will have the most impact.
• Adapt financial models in real time 
  Use data-driven insights to adjust budgets, reallocate resources, and respond to shifting reimbursement patterns
• Use predictive analytics 
  Address workforce challenges such as wage inflation and shortages by anticipating where gaps will occur and implementing targeted recruitment or retention strategies.
• Embrace innovative technologies and care models 
  Select solutions that are guided by data to align with operational goals, enhance efficiency, and improve patient experience.
• Foster a culture of continuous improvement 
  Encourage data-driven decision-making at every level, supported by leadership that values flexibility and adaptation to build workforce resilience.

The challenges facing healthcare aren’t new, but their intensity is unmatched. The OBBBA has accelerated pressures already in motion, signaling that traditional cost-cutting won’t be enough. With implementation in 2026 looming, the time for decisive action is now. 

Mercer can help you embrace meaningful change today while preparing for the profound transformation ahead.

We consider the OBBBA a wake-up call. Those who move boldly and strategically now will be best positioned to thrive in the evolving healthcare landscape. The resilience of your workforce, the satisfaction of your patients, and the stability of your organization may depend on it.