A San Antonio psychiatric hospital is laying off 648 workers effective June 26, after a federal decision terminated its Medicare provider agreement. Laurel Ridge Treatment Center — which serves some of the most medically complex patients in South Texas — is not just cutting staff. It is closing its short-term housing program for people transitioning out of psychiatric care and eliminating its services for refugees and immigrants who have survived human trafficking. The federal action that triggered the collapse is the same policy framework reshaping Medicaid nationally under the One Big Beautiful Bill Act. According to reporting by Xtalks and Becker’s Hospital Review, over 70% of 2026 healthcare layoffs are hitting non-patient-care roles — the food, nutrition, housing, and support positions that hold the care infrastructure together.
Houston is not insulated. Sodexo filed a WARN notice affecting approximately 296 food and nutrition workers at HCA Houston Healthcare facilities, with displacement effective June 13. HCA says affected workers were offered the chance to stay on as HCA employees — but the terms of that transition, including whether wages, seniority, and any existing protections carry over, have not been publicly disclosed. For the predominantly Black and Brown workforce in hospital support services, “you can keep your job” under undisclosed terms is not resolution. It is the beginning of a different story.
The system being dismantled is not peripheral. It is the layer of care that keeps people out of emergency rooms, out of incarceration, and out of institutional settings. When it goes, the costs don’t disappear — they transfer.