Rural hospitals are essential to the health of communities nationwide. Beyond providing care, they’re also economic engines, often the largest employer and a driver of additional businesses and jobs to communities.
Since 2010, 5% of rural hospitals have shut down, and the economic effects are immediate — one study found that when a community loses its hospital, per capita income falls by 4% and the unemployment rate rises by 1.6%. These hospitals are more apt to struggle since their populations often have higher rates of uninsured, Medicaid, and Medicare patients, leading to more uncompensated and under-compensated care.
And the biggest problem is that the trend looks likely to accelerate.
A Navigant analysis shows that nearly one-in-four rural hospitals are at a high risk of closing unless their financial situations improve. The figure is approaching 50% for states like Mississippi, Alaska, and Alabama.
The situation would significantly worsen in the case of an economic downturn, something that’s looming given that the country is in its longest period of economic expansion ever.
One-in-four U.S. rural hospitals are at risk of closing, a trend that would worsen as a well-overdue economic downturn looms.
What Providers need to do
Better reimbursement around telehealth can help promote partnerships between rural hospitals and regional tertiary centers and academic medical centers.
Rural hospitals must explore such partnerships and turn to their local and state legislators to help make legislative changes happen.
Dave's View:
The decline in rural hospital finances and the services they offer their communities will only worsen when the economy hits a rough patch.
Next Trend:
Too Big, Or Not Too Big? Weighing In on Scale
Too Big, or not too big? Weighing in on scale
David Burik
Managing Director
Trend 1
Download 2019 healthcare Trends report
Kai Tsai
Managing Director
Medicare Advantage will Extend its Advantage
Trend 2
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of Physician Practice?
Rulon Stacey
Managing Director
Trend 3
Timothy Kinney
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Demanding More from the EHR and its Vendors
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Dave Mosley
Managing Director
Rural Hospitals and Residents
at Risk
Trend 5
David Burik
Managing Director
Too Big, or not too big? Weighing in on scale
Trend 1
Kai Tsai
Managing Director
Medicare Advantage will Extend its Advantage
Trend 2
Rulon Stacey
Managing Director
The Future
of Physician Practice?
Trend 3
Timothy Kinney
Managing Director
Demanding More from the EHR and its Vendors
Trend 4
Dave Mosley
Managing Director
Rural Hospitals and Residents
at Risk
Trend 5
Download 2019 healthcare Trends report