Rural Hospitals Closing at an Alarming Rate

Rural Hospitals Closing at an Alarming Rate
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When Terry Fulmer’s 90-year-old aunt fell and tore her shoulder ligaments, she had surgery in Albany, a two-hour drive from her home in rural upstate New York.

“Maybe she could have gotten care in a closer town. But her daughter lives in Albany so she had to go there because that’s where she recovered. She couldn’t feed herself, she couldn’t dress herself,” said Fulmer, Ph.D., R.N., F.A.A.N., president of the John A. Hartford Foundation in New York, a foundation dedicated to improving the care of older adults.

For people living in a city, or even in a suburb, the nearest hospital is often a short drive — or bus or subway ride — away.

This is not true for people living in rural America.

As part of a study on barriers older adults face to entering nursing homes, Carrie Henning-Smith, Ph.D., M.P.H., M.S.W., a research associate at the University of Minnesota Rural Health Research Center, hears stories of people who are discharged from the hospital ending up in a nursing home four or five hours from their home — or worse.

“We talked with a discharge planner who placed someone 10 or 11 hours away from their home, which is a bit of an outlier case. But those things happen in rural communities in ways that they don’t in urban communities,” Henning-Smith, told Healthline.

In recent years, the situation has become even more dire, particularly for rural hospitals.

According to the North Carolina Rural Research Program, 80 rural hospitals have closed since 2010.

On top of that, 673 vulnerable rural hospitals are teetering on the edge, according to a 2016 report by the Chartis Center for Rural Health.

Obamacare’s lifeline to rural hospitals

Rural America tends to be sicker, older, and poorer than the rest of the country.

“This group suffers many health disparities. That includes higher rates of diabetes, higher rates of child mortality, fewer years of life, and loss of years of productive life,” Michael Topchik, the national leader for the Chartis Center for Rural Health, told Healthline.

Health insurance coverage is an important tool for helping people stay well and manage their chronic conditions.

The expansion of the Medicaid program under the Affordable Care Act provided coverage to millions of previously uninsured people from low-income households, including those in rural areas.

The law also enabled people with lower incomes — but above the poverty line — to buy coverage through the states’ health insurance marketplaces.

Before the expansion, hospitals still treated uninsured patients. But they were never paid for the medical care provided.

This “charity care” eats away at a hospital’s bottom line, as do other bills that aren’t paid.

By increasing the number of people with health insurance, the Medicaid expansion directly benefitted rural hospitals.

In states that expanded Medicaid, “we saw two important trends — reduction in uncompensated charity care and a reduction in the number, or the velocity, of the rural hospital closures,” Dr. Daniel Derksen, director of the Arizona Center for Rural Health, told Healthline.

Nineteen states, though, opted not to expand Medicaid. In those states, the suffering among rural hospitals is palpable.

The Chartis report found that Mississippi, Louisiana, Georgia, and Texas all have particularly high rates of vulnerable rural hospitals. At the time the report was released, none of those states had expanded Medicaid.

Rural safety net unraveling

In spite of the boost given by Medicaid expansion, the healthcare outlook for rural areas is still grim.

“We see that the safety net is fiscally strained,” said Topchik, “and we worry that the erosion of the operating margin will impact the mission.”

The rural healthcare safety net is a collection of programs and policies with a mission to ensure that the almost 60 million people living in geographically isolated regions of the United States have access to quality healthcare.

Medicaid is a big part of the net, as are Medicare and the State Children’s Health Insurance programs.

“It’s a pretty noble mission,” said Topchik. “But there’s an old expression in business, which is ‘no margin, no mission.’”

In recent years, some state and federal policies have been chipping away at the operating margin of many rural hospitals.

“It’s often referred to by advocates as ‘death by a thousand cuts,’” said Topchik. “If you have a safety net and you start snipping individual webs in the net, eventually it unravels.”

According to the Chartis report, in states that expanded Medicaid, 36 percent of rural hospitals had a negative operating margin in 2015 — meaning they are losing money. In states that didn’t expand Medicaid, 47 percent of rural hospitals had a negative operating margin.

For hospitals with the worst operating margin — lower than negative 5 percent — about 18 percent of rural hospitals in Medicaid-expansion states fell into this category, while 30 percent in non-Medicaid-expansion states did.

Repeal, replace may hurt rural health

Hospitals with a negative operating margin have a harder time absorbing cuts to government funding.

Like the reductions that may come with the Republican-controlled Congress’ plan to “repeal and replace” Obamacare.

Because no alternative plan is in place yet, its effect on Medicaid and the state health exchanges is unknown, leaving already vulnerable rural hospitals hanging in the wind.

This could have an even wider effect on rural communities.

“Hospitals are often important parts of rural communities, sometimes serving as the community's largest employer,” said Henning-Smith. “Closing a rural hospital means all of the people who were employed there lose their jobs — or be transferred out of town.”

When hospitals leave, physician practices, pharmacies, and other medical services may follow. So may nonmedical businesses frequented by hospital employees, like restaurants and shops.

According to the Chartis report, if all 673 vulnerable rural hospitals closed, it would mean a loss of 99,000 healthcare jobs and 137,000 community jobs.

This can add to the stress experienced by people in rural areas, especially for the aging population that lives there.

“You can imagine how terrifying it is in these communities if they believe that one of their hospitals is going to close,” Fulmer told Healthline. “Not only do they lose the personal relationship with the care providers, but also how will they get to where they need to go for healthcare?”

By Shawn Radcliffe

The original story was published on

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