One of America's biggest for-profit hospital operators is bankrupt, broken, and responsible for countless mistreated patients—thanks to its private equity overlords.
RENTON, Wash. — Valley Medical Center will close hospital units and clinics across south King County over the next two months and is planning for potential layoffs as it grapples with financial challenges. The hospital is operating at a loss of $25 million year-to-date, and that figure is growing. That combined with uncertainty from state and federal budgets and private sector reimbursements forced the hospital to scale back operations and restructure its workforce.
After 196 days on strike, Kaiser mental health care workers ratified a new four-year contract Thursday, approving a deal that delivers gains in pay and retirement benefits and delivers a little breathing room for administrative duties.
Five Palm Beach County-based hospitals have filed a federal lawsuit against the nonprofit Leapfrog Group, accusing the watchdog group of publishing misleading safety rankings. According to the lawsuit, Leapfrog Group pressures hospitals to volunteer their data and pay for memberships. The claims indicate that Leapfrog's highest-rated hospitals are paying members.
Crozer-Chester Medical Center in Delaware County is officially closing today, completing the bankruptcy shutdown of all services at the hospital, as well as Taylor Hospital in Ridley Park. Bankruptcy court filings state the closure timeline of both hospitals, which occurred over a span of just under two weeks. Ambulances will still be stationed outside the Crozer ER through May 7, but only to transport patients to other hospitals.
Strategic, bipartisan policy solutions are urgently needed to keep rural hospitals open, says this provider CEO and COO.
Editor's note: Martha Henley is the COO of Java Medical Group and CEO of Unity Medical Center in Manchester, Tennessee. She can be reached at martha@javamedicalgroup.com.
As a lifelong rural resident, and in my dual roles as CEO of a rural hospital and COO of Java Medical Group, a rural hospital management company, I have witnessed firsthand how rural healthcare facilities not only provide essential medical services but also anchor the economies of small towns.
Yet today, many rural hospitals face unprecedented challenges. A report by the Center for Healthcare Quality and Payment Reform revealed that over 700 rural U.S. hospitals are at risk of closure due to financial instability, with more than 300 of these locations facing immediate threats.
The closure of many of these rural healthcare facilities would not only mean the loss of critical healthcare services but also trigger significant economic downturns. Hospitals rank among the largest employers in rural areas. When a hospital closes, the ripple effect can lead to widespread job losses, diminished household income, and the collapse of other local businesses, all of which would adversely impact the community’s vitality.
For example, Williamson Memorial Hospital in Williamson, West Virginia, closed in April 2020, causing a loss to more than 200 hospital staffing jobs overnight. The facility was the largest employer in Williamson and the closure was followed by small pharmacies, cafes, and other closures. Furthermore, the younger working population in Williamson began to leave the community to look for alternate jobs, causing a demographic shift and rise in average age within the population.
To ensure the viability of rural hospitals, we must advocate for targeted, bipartisan policy interventions that address the unique challenges they face. As stakeholders, hospital leaders and rural residents, we can rally behind several key strategies:
Advocate for sustainable funding and reimbursement models. Many rural hospitals operate on thin margins, making them vulnerable to financial instability. Advocating for the permanent extension of programs like the Medicare-Dependent Hospital (MDH) and Low-Volume Hospital (LVH) programs is crucial. These programs ensure that eligible rural hospitals receive reimbursements that reflect their operational realities and provide financial stability. Legislation such as the bipartisan Rural Hospital Support Act aims to address these issues by extending and modernizing critical Medicare programs. Supporting this act will result in direct aid for hospitals facing closure.
Reduce regulatory burdens. Rural hospitals often face regulatory requirements designed for larger, urban facilities, leading to disproportionate administrative burdens. Tailoring regulations to the unique circumstances of rural providers can alleviate unnecessary strain. For instance, adjusting staffing mandates and reporting requirements to align with the capacities of rural hospitals can enhance operational efficiency without compromising care quality.
Expand telehealth services. Telehealth has proven to be a vital tool in bridging access gaps in rural areas. Advocating for the permanent extension of telemedicine coverage under Medicare can ensure that rural residents continue to receive timely care. This includes supporting legislation to make telehealth services a standard component of rural healthcare delivery.
Strengthen the rural healthcare workforce. Recruiting and retaining healthcare professionals in rural areas remains a persistent challenge. Programs that offer scholarships, loan forgiveness, and grants to healthcare providers willing to serve in rural and tribal communities can bolster the workforce. For instance, financial incentives could be used to recruit thousands of new healthcare professionals to rural areas. Currently, the National Health Service Corps (NHSC) offers a national loan repayment program that provides financial support in exchange for a two-year job commitment in an underserved area. In addition, the NHSC offers a scholarship program that further incentivizes healthcare professionals to pursue careers in rural communities. Tennessee also offers its own loan repayment option, the Tennessee State Loan Repayment Program, which works in tandem with the NHSC repayment program and provides up to $50,000 for healthcare professionals who commit to working in rural areas.
Secure key rural healthcare programs. Ensuring the continuity of essential rural healthcare programs is vital. Permanent authorization or long-term extension of programs that support rural hospitals, such as the Medicare Rural Hospital Flexibility Program, an initiative that strengthens financial stability and care services for Critical Access Hospitals, can provide the stability needed for these institutions to thrive.
Engage in collaborative policy development. Building coalitions with policymakers, healthcare providers, and community leaders can amplify advocacy efforts. Participating in task forces and working groups dedicated to rural health policy can lead to the development of comprehensive strategies that address the multifaceted challenges faced by rural hospitals.
Promote public awareness and community engagement. Educating the public and engaging community members on the important role of rural hospitals and involving them in advocacy efforts can generate grassroots support for rural healthcare initiatives. Highlighting the critical role of rural hospitals in local economies and public health can mobilize community action and influence policymakers.
Most importantly, don’t underestimate the power of your voice. Every call, every conversation, and every effort matters. These hospitals are more than healthcare providers; they are lifelines for their communities. Together, we can ensure they remain open, accessible, and equipped to save lives for generations to come.
Editor's note: Care to share your view? HealthLeaders accepts original thought leadership articles from healthcare industry leaders in active executive roles at payer and provider organizations. These may include case studies, research, and guest editorials. We neither accept payment nor offer compensation for contributed content.
