U of Iowa Health Care delays expansion project amid federal cuts
University of Iowa Health Care has decided to delay work on a $2 billion inpatient tower due to federal funding changes that are projected to result in a $9.5 billion reduction in healthcare funding to Iowa.
In an Aug. 28 statement, the academic health system said work on the Jacobson Tower will continue “on a new timeline.” The tower is part of the system’s 10-year revitalization plan and is meant to address capacity issues and expand access for patients requiring complex and specialty care.
Several projects needed to make way for the inpatient tower will be delayed, including the removal of a parking ramp, demolition of the Wendell Johnson Speech and Hearing Center and renovations on the main hospital entrance and skywalk changes.
“While UI Health Care is in a more stable financial position than many other academic healthcare systems across the country, adjustments to capital projects, needed to modernize its facilities, will be necessary,” officials said in a news release.
UI Health Care cited looming federal funding cuts as a key factor in the decision to revisit capital plans.
“Recently announced federal funding changes will significantly affect the healthcare industry over the next 10 years,” officials said. “The Congressional Budget Office estimates a 10-year reduction of more than $1 trillion for healthcare nationally, with the state of Iowa anticipating a $9.5 billion reduction.”
The CBO estimates changes to health funding under the One Big Beautiful Bill Act will result in nearly $1 trillion in cuts to Medicaid and other federal health programs by 2034, with 10 million people becoming uninsured.
Work on two projects related to the new tower — construction of a new road to connect Newton Road to the main hospital campus and a water tower replacement — will continue as planned. The health system also said it plans to move forward with the modernization of downtown medical campuses and the expansion of its cancer research space.
“This remains a priority given Holden Comprehensive Cancer Center’s pivotal role as the only National Cancer Institute-designated comprehensive cancer center in Iowa,” officials said. “UI is a leader in achieving the state’s high cancer survival rates and is a vital player in tackling Iowa’s fastest-growing rates of new cancers in the country.”
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