The Plight of Rural Hospitals in America

Rural hospitals are critical

October 2019 — We first reported this subject in the summer of 2018. Since that time, an additional 15 rural hospitals closed in 2018 and another 17 have closed in 2019.

December 2021 —Another 19 rural hospitals closed in 2020. That is the largest number of such facilities to close in a single year since 2005.

Rural hospitals are in a crisis. Unfortunately, our lawmakers have no solutions they can agree on. Unless you live in a rural area you may not know or even care about this problem. Everyone should care. That is why we are revisiting this article today.

In the past 10 years, eight rural hospitals have closed in Georgia. Only Texas and Tennessee have had more closures. In the last 10 years, 129 hospitals have closed. Of this total 86 were in Texas and the Southeast.

For most rural communities their small nonprofit or city-owned hospital feels like a public asset. Something that is critical and needs to be maintained, like roads and the fire department. Herein lies a big problem.

♦ Should the local hospital be considered a social-welfare organization worthy of government support or a business subject to shifting economic winds?

The closure of rural hospitals increases the difficulty of getting care and in some cases can mean the difference between life and death.

Rural areas have higher death rates from cancer, heart disease and stroke than urban areas do.

The CDC reported that people in rural areas are 50% more likely than city dwellers to die from injuries like car crashes and drug overdoses, in part because of greater distances to emergency care.

Rural hospitals are fragile

There are around 5,100 community hospitals in the United States. A third of these hospitals are in rural areas. Nearly 40% of rural hospitals are located in the South.

Rural communities tend to be both poorer and sicker than urban areas. Rural hospitals are more likely to care for a larger percentage of elderly than urban hospitals.

♦ Rural communities suffer from higher levels of poverty and uninsured. A larger portion of the rural population (46%) depends on government insurance like Medicare and Medicaid for health care coverage. At the same time, rural communities have declining populations.

From 2005 thru 2017, 160 rural hospitals closed. Nearly 21% of rural hospitals are on the verge of closing

♦ Rural hospital closure includes both hospital conversion and abandoned hospitals.

Converted hospitals remain a healthcare facility but do not provide inpatient care. The hospital may be converted to an urgent care or emergency facility. A few have been converted to outpatient or primary care facilities.

• Hospital conversions and closures disproportionately impact non-Whites (particularly Blacks), poor people, and women.

Years ago, federal lawmakers passed legislation authorizing Medicare to make higher payments to hospitals that serve rural communities. This effort was too little and too late.

♦ In August 2019, CMS issued new rules regarding payments to rural hospitals. These rule changes are not likely to stem the tide of closures. Changes to Medicare payments must be budget-neutral which means one service may receive an increase while another area will experience a decrease.

♦ The loss of the local hospital poses a significant barrier to receiving proper health care, particularly for elderly citizens who do not drive.

The most closures have been hospitals located in the South. In states still fighting to scuttle the Affordable Care Act. Texas has seen the most of any state with 13 hospitals closing since 2010. Tennessee closed 8, Georgia 6, Alabama and Mississippi each had 5 closures.

• A study by the Colorado School of Public Health found that states that did not expand Medicaid were six times more likely to close rural hospitals than states that did join Medicaid expansion.

Rural hospitals see more uninsured patients and provide more free care. Medicaid does not pay much but for many smaller hospitals it can mean the difference between keeping the lights on and locking the doors.

♦ The Kaiser Family Foundation reports that one in five adults in the South is in poor health. The South has the highest level of obesity, diabetes and hypertension. Yet their government leaders stand idly by and watch as their rural hospitals close at an ever increasing rate.

Communities suffer

Having a local hospital was once seen as a way to attract employers. The local hospital has now become the primary employer and lifeblood for many communities. When the local hospital closes the surrounding region’s economy declines.

♦ Most rural hospitals were built decades ago and can’t afford upgrades. In some cases residents may have to drive many miles to urban hospitals for specialty care like surgery or even labor and delivery services. When this happens, people then start thinking their local hospital is inferior.

When the local hospital is viewed as low or poor quality, residents with private insurance or other resources are more willing to travel to bigger, newer hospital systems outside the community. Without privately insured patients, local hospitals are left with a higher percentage of uninsured and people with Medicare and Medicaid.

Medicare and Medicaid pay a lot less than commercial insurance, in some cases below costs. Without sufficient revenues to maintain their aging facilities, rural hospital decline will continue.

• Republicans continue to propose cuts to Medicare and Medicaid. This will just make a bad situation worse.

♦ Expanding Medicaid would help low-income people and provide more revenue for local hospitals. But political leaders in the worst states continue to refuse to expand the program, citing the costs for the state and ignoring the costs to their citizens when their local hospital is no more.

No help will be coming from the federal level. Our politicians are too busy fighting with each other to see that the barn is on fire.