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Comprehensive Hospital Statistics in Texas, USA

March 13, 2026

Texas is home to one of the largest and most complex hospital systems in the United States. With approximately 525 hospital businesses in 2026, a combined market size of $104.7 billion, and over 413,000 employees, the state’s healthcare infrastructure is both vast in scale and deeply varied in character — spanning world-class urban academic medical centers, mid-sized regional facilities, and small rural critical access hospitals serving isolated communities across the state’s 254 counties.

This report consolidates key statistics across ten dimensions of the Texas hospital landscape: ownership structure and hospital counts, licensed bed capacity, patient volume and utilization trends, economic impact, financial health, rural hospital viability, healthcare workforce, quality outcomes, uninsured population and charity care, and hospital oversight and designations. The data spans multiple years — primarily 2017 through 2024 — and draws on sources.

The statistics presented here tell a story of a healthcare system under significant and sustained pressure. While Texas hospitals provide essential services to millions of patients each year and act as major economic engines in their communities, they face mounting challenges: a historically high uninsured population, post-pandemic financial strain, a deepening nursing and physician shortage, and an accelerating rural hospital closure crisis. Understanding the full scope of these trends — through data — is essential for policymakers, healthcare leaders, and the public alike.

Hospital Count & Ownership Structure

Texas operates one of the largest hospital systems in the United States. In 2026, the state has approximately 525 hospital businesses with a combined market size of $104.7 billion and 413,790 employees. The industry has grown at an average annual rate of 1.3% from 2021 to 2026. The majority of hospitals are for-profit facilities, a defining characteristic of the Texas hospital landscape that distinguishes it from most other states.

Count of Care Hospitals by Ownership Type, 2017–2023

The following table shows the annual count of care hospitals in Texas broken down by ownership type from 2017 to 2023, based on Texas Department of State Health Services data. For-profit hospitals consistently account for more than half of all facilities.

Year	For-Profit	Non-Profit	Public	Total
2017	332	162	114	608
2018	323	152	115	590
2019	321	155	111	587
2020	325	161	109	595
2021	328	162	109	599
2022	331	163	108	602
2023	330	165	104	599

Total hospital count declined from 608 in 2017 to a low of 587 in 2019, before partially recovering to 602 in 2022. By 2023, the count stood at 599. For-profit hospitals remained dominant throughout, while public hospitals declined steadily from 114 in 2017 to 104 in 2023. Non-profit hospitals showed slight growth from 162 to 165 over the same period.

Community Hospitals by Ownership Type, 2020–2024 (Community Hospitals Only)

The following figures are drawn from a separate data series covering community hospitals only, which represent approximately 85% of all hospitals. Federal hospitals, long-term care, psychiatric, and specialty facilities are excluded from this count.

Year	State/Local Govt	Non-Profit	For-Profit	Total
2024	98	149	256	503
2023	96	149	259	504
2022	97	152	260	509
2021	99	152	266	517
2020	99	153	271	523

Community hospital totals declined from 523 in 2020 to 503 in 2024, driven largely by a decrease in for-profit community hospitals (from 271 to 256). State/local government hospitals also fell from 99 to 98. This trend reflects ongoing financial pressures and consolidation within the Texas hospital market.

Hospital Types Among Nonprofit Facilities

Among the 325 nonprofit hospitals and primary care facilities in Texas, the sector employs 281,469 people and generates over $64.7 billion in annual revenues with $118.5 billion in assets. The table below shows the distribution by nonprofit type.

Type	Count	Employees	Revenues
Hospitals & Primary Care Facilities	325	281,469	$64.7B
Community Health & Hospital Systems	116	119,767	$26.3B
General Hospitals	116	112,846	$24.6B
Specialty Hospitals	38	44,881	$13.2B

General hospitals and community health systems each account for 116 organizations, but community health systems command a larger workforce and revenue base. Specialty hospitals, while fewer in number (38), generate $13.2 billion in revenue, reflecting their high-acuity, high-cost service mix. The specialty hospital sector alone represents a $12.1 billion industry in 2026 with 127 businesses.

Licensed Hospital Beds

The number of licensed beds reflects the capacity of the Texas hospital system. Licensed beds are defined by the Texas Department of State Health Services (DSHS) Health Facilities Licensing.

Licensed Beds by Ownership Type, 2017–2023

The following table tracks the total number of licensed beds across Texas hospitals, broken down by ownership category over a seven-year period.

Year	For-Profit Beds	Non-Profit Beds	Public Beds	Total Beds
2017	38,571	34,919	12,827	86,317
2018	38,595	34,619	13,623	86,837
2019	37,656	35,206	12,960	85,822
2020	37,710	35,453	13,179	86,342
2021	37,787	36,186	13,477	87,450
2022	38,124	36,577	13,827	88,528
2023	38,187	36,640	13,008	87,835

Total licensed beds peaked at 88,528 in 2022 before declining slightly to 87,835 in 2023. Non-profit beds showed consistent growth from 34,919 in 2017 to 36,640 in 2023, while for-profit beds grew modestly. Public beds were volatile, peaking at 13,827 in 2022 before falling sharply to 13,008 in 2023. In 2013, Texas had approximately 84,000 licensed beds, suggesting meaningful capacity expansion over the decade.

Patient Volume & Hospital Utilization

Patient volume data reflects the intensity of demand on the Texas hospital system. Emergency department and outpatient visits, admissions, inpatient days, and surgical operations each measure different aspects of system utilization.

Emergency Department and Outpatient Visits, 2017–2023

The following table presents annual emergency department (ED) and outpatient visit counts across all Texas hospitals. The COVID-19 pandemic caused a dramatic drop in 2020, with strong recovery in subsequent years.

Year	Emergency Department	Outpatient Visits	Total
2017	11,841,694	32,404,675	44,246,369
2018	12,035,924	33,189,615	45,225,539
2019	12,153,643	34,833,763	46,987,406
2020	10,596,755	31,075,808	41,672,563
2021	11,291,414	35,586,801	46,878,215
2022	12,623,394	36,793,799	49,417,193
2023	12,739,777	36,673,751	49,413,528

Emergency department visits fell sharply in 2020 to 10.6 million (down 13% from 2019), reflecting pandemic-era avoidance of care and lockdowns. By 2023, ED visits had fully recovered to a record 12.7 million. Outpatient visits followed a similar pattern, dropping to 31.1 million in 2020 but rebounding to a high of 36.8 million in 2022. The continued growth in outpatient volume reflects a deliberate shift toward outpatient-based care delivery.

Admissions and Inpatient Days, 2017–2023

This table shows total hospital admissions and inpatient days, along with a calculated average length of stay, which reflects the acuity and complexity of patients being treated.

Year	Admissions	Inpatient Days	Avg. Length of Stay (days, calc.)
2017	2,871,914	16,196,091	5.6
2018	2,884,387	16,222,005	5.6
2019	2,924,120	16,417,693	5.6
2020	2,783,527	16,148,701	5.8
2021	2,893,545	17,271,517	6.0
2022	2,974,120	17,370,818	5.8
2023	3,050,392	17,632,513	5.8

Hospital admissions declined in 2020 (to 2.78 million) before rebounding to a record 3.05 million in 2023. More notable is the sharp rise in inpatient days during 2021 and 2022, suggesting that admitted patients required longer stays — a pattern linked to more severe illness, post-pandemic care backlogs, and shortages of post-acute care beds preventing timely discharge.

Surgical Operations, 2017–2023

The table below breaks down surgical operations into inpatient and outpatient categories, reflecting both the volume and the ongoing shift from inpatient to outpatient surgical settings.

Year	Inpatient Surgical	Outpatient Surgical	Total Surgical
2017	778,405	1,388,796	2,167,201
2018	767,857	1,358,106	2,125,963
2019	765,012	1,405,292	2,170,304
2020	696,632	1,224,518	1,921,150
2021	698,652	1,381,767	2,080,419
2022	703,585	1,485,505	2,189,090
2023	739,777	1,509,819	2,249,596

Total surgical volume fell significantly in 2020 due to the pandemic-related suspension of elective procedures. Outpatient surgeries recovered faster and more fully than inpatient procedures: by 2023, outpatient surgical volume (1.51 million) had reached a new high, while inpatient surgical volume (739,777) remained below the 2017–2019 range. This confirms the long-term structural shift toward outpatient surgical care.

Economic Impact

Hospitals are among the largest employers and economic engines in Texas communities. Their impact extends well beyond direct employment, generating multiplier effects throughout local economies.

Statewide Economic Footprint

Key economic figures highlight the outsized role Texas hospitals play in the state economy:

Texas hospitals employed more than 445,000 people in 2022, including over 358,000 full-time employees (not counting contracted staff and physicians with practice privileges).
Texas hospitals employed 35,000 more people in 2022 than in 2020.
In 2022, hospital jobs accounted for roughly 1 in every 12 jobs in Texas.
One Texas hospital job supports an additional 2.6 jobs in other sectors.
Every dollar spent by Texas hospitals generates more than $2 of additional economic impact.
The combined hospital industry (including all types) employs 413,790 workers in 2026, up from lower levels in 2021, growing at 3.0% per year.
Total nonprofit hospital revenues in Texas exceed $64.7 billion annually, with assets of $118.5 billion.

The Texas hospital sector is not only a healthcare provider but a foundational economic institution. The 2.6x job multiplier and $2+ economic multiplier per dollar spent illustrate why hospital closures — particularly in rural areas — have cascading effects on local economies beyond the direct loss of healthcare access.

Hospitals by Major Texas Cities

The following table shows the concentration of nonprofit hospitals, employment, revenue, and assets by major metropolitan area.

Metro Area	Nonprofits	Employees	Revenues	Assets
Dallas	116	126,302	$29.7B	$55.8B
Houston	54	99,517	$24.2B	$49.1B
San Antonio	17	5,617	$1.1B	$1.2B
Abilene	6	6,458	$1.2B	$1.8B
Lubbock	7	4,254	$1.1B	$1.8B
College Station	7	3,424	$553M	$646M
Longview	6	3,246	$642M	$386M
McAllen	5	2,166	$272M	$261M
Austin	7	29	$12.9M	$70M
Tyler	5	0	$468K	$328K

Dallas and Houston dominate the hospital landscape, together accounting for 170 nonprofit organizations, over 225,000 employees, and more than $53 billion in revenues. There are striking disparities between metros: Abilene (population far smaller than San Antonio) has similar or higher revenues and assets compared to San Antonio, reflecting the concentration of regional referral hospitals. Austin appears underrepresented relative to its population, with only 29 hospital employees and $12.9M in revenues in the nonprofit category.

Financial Health of Texas Hospitals

The financial condition of Texas hospitals has been under severe strain since the COVID-19 pandemic, with rising costs outpacing revenue growth and a substantial share of facilities operating in the red.

Hospital Closure Risk by Year

The following table shows the percentage of Texas hospitals at serious risk of closure, defined by having an operating margin below 0%, days cash on hand under 113, and a debt-to-capitalization ratio exceeding 50%.

Year	Overall Risk	Rural Risk	Urban Risk
2020	4.7%	16%	3%
2021	5.5%	16%	3%
2022	9.2%	26%	5%

The risk of closure among Texas hospitals nearly doubled from 4.7% in 2020 to 9.2% in 2022. The disparity between rural and urban hospitals is stark: by 2022, 26% of rural hospitals were at serious risk of closure, compared to just 5% of urban hospitals. One in four rural Texas hospitals was considered financially vulnerable by 2022, underscoring the acute crisis facing non-metropolitan healthcare.

Operating Margin Trends

The following figures show the percent of Texas hospitals with negative operating margins and the change in operating margins relative to pre-pandemic 2019 levels.

2019: 33.9% of hospitals had negative operating margins
2020: 34.7% of hospitals had negative operating margins
2021: 30.4% of hospitals had negative operating margins (temporary relief from CARES Act)
2022: 47.4% of hospitals had negative operating margins

Nearly half of all Texas hospitals (47.4%) had negative operating margins in 2022, up sharply from one-third in 2019. The temporary CARES Act relief helped reduce the proportion in 2021 to 30.4%, but with federal relief exhausted, the situation deteriorated dramatically in 2022. Operating margins were 24.1% below 2019 levels by 2022, and Texas hospitals incurred a $3.2 billion loss relative to pre-pandemic income — approximately a 30% reduction in total state income.

Hospital Expense Growth vs. 2019 Baseline

The following table shows cumulative excess spending above pre-pandemic (2019) levels across key expense categories for Texas hospitals.

Expense Category	2020 vs 2019	2021 vs 2019	2022 vs 2019
Total Expenses (excess $B)	$12.6B	$33.2B	$33.2B
Labor Expenses (excess $B)	$5.0B	$16.4B	$18.1B
Contract Labor (excess $B)	$0.1B	$2.5B	$4.9B
Medical Supplies (excess $B)	$0.6B	$2.7B	$1.3B
Drug Expenses (excess $B)	$1.2B	$2.8B	$2.8B

By 2022, total expenses were $33.2 billion above 2019 levels — a 20% cumulative increase — while revenues grew by only 11% over the same period. Labor costs were the primary driver, running $18.1 billion higher than 2019, partly due to a $4.9 billion surge in contract (travel) labor. Drug expenses alone were $2.8 billion above pre-pandemic levels. This expense-revenue gap is the structural cause behind the surge in hospitals with negative margins.

Lost Hospital Income Relative to 2019

The following figures document lost income for Texas hospitals relative to pre-pandemic levels across the first three years of the pandemic.

2020: -$1.6 billion in income relative to 2019 (partial CARES Act offset)
2021: +$2.6 billion in income relative to 2019 (CARES Act support and recovery)
2022: -$3.2 billion in income relative to 2019 (no further federal relief available)

The financial trajectory of Texas hospitals mirrors a volatile rollercoaster: $1.6 billion in losses in 2020 were partially offset by CARES Act funding, leading to a $2.6 billion income gain in 2021. But 2022 saw the worst outcome yet, with $3.2 billion in lost income relative to 2019, and no federal relief forthcoming. This erosion of income with no relief in sight represents an existential threat to a significant portion of the state’s hospital infrastructure.

Rural Hospital Financial Snapshot, 2023

This table presents key financial and operational indicators for Texas rural hospitals based on 2023 data from the TORCH/Lucky Dog Analytics Hospital Vulnerability Index analysis.

Metric	Value (2023)
Rural hospitals with positive total margins	63%
Median total margin	5.4%
Rural hospitals with negative operating margins	~40%
Hospitals with losses > negative 10%	15%
Rural hospitals with positive net income	63%
Median net income (profitable hospitals)	$1.1M
Rural hospitals with negative net income	37%
Aggregate negative net income	$274M+
Median net income loss	$1.63M
Aggregate net patient services income	$6.3B
Aggregate operating expenses	$6.38B
Total uncompensated care burden	~$660M
Median uncompensated care per hospital	$3.4M
Rural hospitals with positive net income from patient services	< 23% (77% negative)
Median operating expenses (all rural)	$26.6M
Median operating expenses (CAH)	$20.9M
Median operating expenses (rural PPS)	$49.4M
Hospital districts aggregate levy collected	$583M+
Rural hospitals in markets with negative PSA growth	57%
CAHs with ADC-acute below 1	40%

The financial picture for Texas rural hospitals in 2023 is deeply concerning. While 63% reported positive total margins, 77% had negative net income from patient services — meaning virtually all rural hospitals depend on supplemental income sources (tax levies, grants, supplemental payments) to survive. The aggregate net income shortfall of $274M among unprofitable hospitals led analysts to recommend a $274M state investment to bring the sector to breakeven. Hospital districts collected over $583M in property tax levies in 2023, providing critical but inconsistent support.

Healthcare Workforce

Texas faces a severe and worsening healthcare workforce shortage, particularly in nursing. The shortage predates COVID-19 but was dramatically accelerated by pandemic-related burnout, turnover, and early retirements.

Nurse Vacancy Rates, 2022 vs. 2024

The 2024 Hospital Nurse Staffing Survey (HNSS), conducted by the Texas Center for Nursing Workforce Studies, surveyed 739 Texas hospitals and received responses from 297. The following table compares nurse vacancy rates between 2022 and 2024 across all major nursing categories.

Nurse Type	Vacancy Rate 2022	Vacancy Rate 2024
Registered Nurses (RN)	17.6%	16.4%
Nurse Practitioners (NP)	11.9%	23.8%
CRNAs	16.7%	18.8%
CNMs	4.6%	15.6%
Clinical Nurse Specialists (CNS)	7.1%	6.2%
LVNs	23.1%	21.5%
Nurse Aides (NA)	17.0%	14.3%

While RN and LVN vacancy rates showed modest improvement from 2022 to 2024, several advanced practice categories saw dramatic increases. Nurse Practitioner vacancies nearly doubled from 11.9% to 23.8%, and CNM (Certified Nurse Midwife) vacancies surged from 4.6% to 15.6%. As of 2024, there were 8,575 vacant RN positions out of 52,370 total statewide. The overall picture shows improvement in some areas but acute worsening in advanced practice roles that are critical for expanding primary care access.

Nurse Turnover Rates, 2022 vs. 2024

High turnover compounds the nursing shortage by draining institutional knowledge and increasing recruitment and onboarding costs. The following table compares turnover rates across nursing categories.

Nurse Type	Turnover Rate 2022	Turnover Rate 2024
Registered Nurses (RN)	28.3%	23.2%
LVNs	18.9%	21.1%
Nurse Aides (NA)	35.0%	29.9%
APRNs (all types)	N/A	0% (median)

RN turnover fell from 28.3% to 23.2%, and Nurse Aide turnover dropped from 35.0% to 29.9% — both positive trends. However, LVN turnover increased from 18.9% to 21.1%. Turnover at these levels is costly: replacing a single nurse typically costs tens of thousands of dollars in recruitment and training, representing a significant ongoing financial drain for already-stressed hospitals.

Projected RN Supply vs. Demand in Texas

The following projections, based on data from the Texas Department of Health and the Texas Center for Nursing Workforce Studies, show the growing gap between available RN supply and projected demand.

2020: RN supply — 233,968 FTEs; projected demand — 263,133 FTEs; gap — 11% (29,165 FTEs short)
2032 (projected): RN supply — 291,872 FTEs; projected demand — 348,883 FTEs; gap — 16% (57,011 FTEs short)

Texas was already short 29,000 nurses in 2020. By 2032, projections show a deficit of 56,370 RN FTEs, with 15.6% of projected demand going unmet. Despite plans to hire an additional 10,808 nursing FTEs across hospitals in the near term, this is far short of the structural gap. Only 5 of 254 Texas counties have a sufficient number of primary care physicians by federal guidelines, further compounding the workforce challenge.

Primary Care Shortage Areas in Texas

The federal Health Resources and Services Administration designates areas with fewer than one primary care provider per 3,500 residents as Health Professional Shortage Areas (HPSAs). The following table shows the dramatic worsening of primary care shortages in Texas between 2019 and 2021.

Whole county is a shortage area: 129 counties in 2019 → 228 counties in 2021 (change: +99)
Part of county is a shortage area: 91 counties in 2019 → 21 counties in 2021 (change: -70)
No shortage area in county: 34 counties in 2019 → 5 counties in 2021 (change: -29)

The number of Texas counties where the entire county is a primary care shortage area nearly doubled from 129 to 228 between 2019 and 2021 — an increase of 99 counties in just two years. Today, 82% of Texas counties are entirely primary care shortage areas. This is one of the worst rates in the nation, contributing to overuse of emergency departments and high rates of preventable hospitalizations.

Workforce Distribution by Hospital Size

The following table shows the distribution of Texas nonprofit hospitals and healthcare facilities by workforce size.

0 employees: 77 organizations
1–10 employees: 20 organizations
11–25 employees: 9 organizations
26–100 employees: 12 organizations
101–1,000 employees: 51 organizations
1,000+ employees: 58 organizations

The distribution of hospital workforce size is bimodal: 77 organizations report zero employees (potentially inactive or administrative entities), while 58 organizations employ more than 1,000 workers. The 51 hospitals in the 101–1,000 employee range represent the backbone of mid-sized community hospitals. This concentration of large employers underscores the outsized economic impact of hospital closures in their communities.

Healthcare Quality & Outcomes

High spending in the Texas healthcare system has not translated consistently into better patient outcomes. A 2024 analysis by international healthcare recruitment firm Espirita compared Texas against all 50 states on key quality metrics.

Texas Healthcare Metrics vs. National Best and Worst States

The following table compares Texas on nine key healthcare quality and spending metrics against the best- and worst-performing states.

Metric	Texas	Best State	Best Value	Worst State	Worst Value
Medicare Spending/Beneficiary	$11,694	Hawaii	$6,915	Louisiana	$12,211
Successful Nursing Discharge	52%	Utah	69%	Louisiana	44%
Avoidable ER Visits (65+)/1,000	147	Hawaii	114.5	W. Virginia	176.4
Preventable Hospitalizations/1,000	30.0	Hawaii/Idaho	15.8	W. Virginia	40.2
Inappropriate Back Imaging	72%	New Hampshire	60%	Wyoming	78%
Insurance Spending/Enrollee	$6,475	Hawaii	$4,566	Alaska	$8,959
Primary Care Spending (18–64)	7.3%	Minnesota	10%	Georgia	4.1%
Hospital Readmission (65+)	32.9%	Alaska	19.9%	W. Virginia	42.7%
Home Health Hospital Admission	14%	Utah/CA	11–12%	N. Dakota	18%

Texas spends $11,694 per Medicare beneficiary — near the top nationally — yet performs poorly on most outcome metrics. Only 52% of skilled nursing patients achieve successful discharge, compared to 69% in Utah. The 30-day hospital readmission rate of 32.9% is well above the national best of 19.9% (Alaska). Texas’s rate of inappropriate lower back imaging (72%) suggests significant overuse of diagnostic services. On nearly every metric, Texas achieves below-average outcomes despite above-average spending, pointing to systemic inefficiencies in care delivery.

Rural Hospital Crisis

Rural hospitals in Texas face the most severe financial and operational pressures in the state. Texas has the highest number of rural hospital closures of any state in the nation since 2005, and the crisis shows little sign of abating.

Rural Hospital Closures and Bed Losses Since 2005

Key figures on the scale of rural hospital loss in Texas:

Since 2005, Texas has seen 24 rural hospital closures — the highest number of any state in the nation.
Texas lost 880 hospital beds from rural closures between January 2005 and November 2021 — more than any other state.
California, a far more populous state, lost roughly 2.6 times fewer beds over the same period.
21 out of 24 rural hospital closures in Texas since 2005 occurred in counties that are entirely healthcare professional shortage areas.
In the last decade (through 2024), 21 rural hospitals in Texas have closed — more than any other state.

The geographic concentration of closures in East Texas and along the border region has left many counties with no hospital at all. The link between closure and primary care shortages is nearly absolute: 87.5% of closed rural hospitals were in counties where the entire county lacked adequate primary care providers, creating a double burden of inaccessibility for residents.

Texas Counties Without Hospital Access

Access to hospitals is absent in a significant share of Texas counties, with the problem compounded in some areas by the absence of emergency services.

71 counties (28% of all Texas counties) have no hospital of any kind.
Of those 71 counties, 7 previously had a rural hospital that has since closed.
11 counties have no hospital AND no EMS station — leaving residents with no emergency medical services of any kind.

Twenty-eight percent of Texas counties — 71 in total — have no hospital of any kind. Of these, 11 also lack any EMS station, leaving residents with no prehospital emergency care options. For the elderly, those with mobility limitations, or anyone requiring emergency care in these counties, the nearest hospital may be many miles away with no ambulance service to bridge the gap.

Population Trends and Hospital Availability

Population change is a key driver of rural hospital viability. The following table shows the relationship between county population trends and hospital availability in Texas.

Population Trend	No Open Hospitals	At Least One Hospital	Had Rural Closure
Declining	44%	56%	7%
Stable	29%	71%	17%
Growing	19%	81%	10%

The correlation between population decline and hospital absence is stark: 44% of Texas counties with declining populations have no open hospitals, compared to only 19% of growing counties. Shrinking populations reduce patient volumes and revenues while workforce recruitment becomes harder, creating a self-reinforcing cycle. However, it is worth noting that rural hospital closures do not follow population trends in a simple way — the closure of a town’s only hospital can itself accelerate population decline.

Rural Hospital Market Position, 2023–2024

Based on the 2025 TORCH/Lucky Dog Analytics financial solvency analysis, the current market position of Texas rural hospitals is as follows:

29% of rural hospitals are still recovering toward pre-pandemic volume and utilization levels.
30% are growing.
26% are stable.
16% are declining.
Approximately 22% reported they will be barely surviving in 2025.
One hospital indicated it may be at risk of bankruptcy.
About one-third anticipate better financial performance in 2025 than in 2024.
57% of Texas rural hospitals operate in markets with negative primary service area growth.
Only about 40% of Texas rural hospitals currently provide labor and delivery services.

The market position data paints a picture of fragmentation: while 56% of rural hospitals are growing or stable, a substantial portion (45%) are recovering, declining, or barely surviving. The near-universal retreat from labor and delivery services — with only 40% of rural hospitals still offering it — has severe consequences for maternal and newborn outcomes in rural Texas, forcing expectant mothers to travel long distances for care.

Uninsured Population & Charity Care

Texas has the highest uninsured rate of any state in the nation, creating enormous pressure on hospitals to provide unreimbursed charity care and absorb the costs of uncompensated services.

Texas Uninsured Rate

Texas has approximately 5 million uninsured residents — the highest raw number of any state.
Approximately 17% of Texans lack health insurance — more than double the national average of 9.9%.
Texas is one of only 12 states that have not adopted Medicaid expansion under the Affordable Care Act.
In the Panhandle region, more than half of counties have uninsured rates above 25%.
In the Rio Grande Valley, uninsured rates are among the highest in the entire nation.
Texas has 586,000 rural residents without health insurance.

The combination of a large uninsured population and non-expansion of Medicaid has created a structural funding crisis for Texas hospitals. Research consistently shows that non-expansion states have higher rates of uninsured patients, more unrecoverable debt, higher charity care burdens, and more hospital closures. Texas exemplifies this pattern, leading the nation on all four measures.

Charity Care and Uncompensated Care

In 2022, Texas nonprofit hospitals provided almost $2.4 billion in charity care.
Nonprofit hospitals exceeded the state’s charity care standard by 32%, or $576 million above the most commonly used threshold.
Every single nonprofit hospital in Texas met the state’s charity care standards in 2022.
Medicare reimbursement to Texas hospitals reached a historic low of 82 cents on the dollar in 2022–2023.
Texas rural hospitals had a total uncompensated care burden of approximately $660 million in 2023, with a median of $3.4 million per hospital.

Despite their financial struggles, Texas nonprofit hospitals significantly exceeded the state’s charity care requirements — providing $576 million more than the minimum standard. However, the combination of government underpayments (Medicare at 82 cents on the dollar), large uninsured populations, and high uncompensated care burdens creates an unsustainable financial model for many facilities, particularly smaller rural hospitals.

Special Designations & Hospital Oversight

Texas maintains a rigorous licensing and designation framework for its hospitals, administered primarily by the Texas Department of State Health Services.

Hospital Licensing and Accreditation

The Texas Department of State Health Services licenses all hospitals in Texas.
Hospitals must comply with federal Medicare Conditions of Participation to receive Medicare payments.
State inspections are required at least once every three years (per license term), with unannounced visits for complaint investigations.
Most hospitals engage independent reviewing organizations for Medicare Conditions of Participation compliance assessment.
Hospitals that receive accreditation from approved organizations are granted deemed status by the state.

Special Hospital Designations

Trauma Centers: Designated Levels I through IV, with Level I representing the highest care capability.
Stroke Centers: Facilities with specialized resources and trained staff for stroke treatment.
Magnet Recognition: Awarded by the American Nurses Credentialing Center to hospitals whose nurse staffing meets 14 core characteristics of nursing excellence.
Rural Emergency Hospitals (REH): A federal designation available since early 2023 in Texas, allowing rural hospitals to provide emergency, observation, and outpatient care while discontinuing adult inpatient services — enabling financially stressed facilities to remain open.

The Rural Emergency Hospital designation represents a meaningful policy innovation that allows financially strained rural facilities to remain operational in a reduced-service capacity, rather than closing entirely. As of 2023, this designation became available to Texas hospitals and is seen by the Texas Hospital Association as a critical tool for preserving at least some level of emergency access in vulnerable rural communities.

Conclusion

The Texas hospital system is economically significant but faces major structural challenges. In 2022, hospitals employed over 445,000 people, generated billions in economic activity, and provided nearly $2.4 billion in charity care. However, almost half of hospitals operated with negative margins, and 26% of rural hospitals were at risk of closure.

Several interconnected factors drive these problems. Texas has the highest uninsured rate in the United States, with about 5 million residents (17% of the population) lacking coverage. Since 2005, 24 rural hospitals have closed, and 82% of counties are designated as primary care shortage areas. Workforce shortages are also growing, with the nursing workforce projected to fall short by 56,370 full-time equivalents by 2036. Meanwhile, Medicare reimbursement has fallen to about 82 cents per dollar of care provided.

These pressures reinforce one another: uninsured patients delay care and arrive sicker, government reimbursements remain below costs, hospital margins shrink, and staffing shortages worsen care quality and patient outcomes.

Although recent policy measures—including increased Medicaid rural payments, $50 million in rural stabilization grants, the Rural Emergency Hospital designation, and the Texas Healthcare Workforce Task Force—represent progress, they remain insufficient. With one in four rural hospitals at risk, 71 counties without a hospital, and a $3.2 billion industry income shortfall in 2022, sustained investment and coordinated policy action are needed.