New analysis by Chartis reveals how vulnerable rural hospitals are across the country, especially in certain states.
The number of rural hospitals in danger of closing is increasing, placing greater stress on the health of those communities.
Loss of access to care, combined with the decline in rural population health and growing "care deserts," is creating an unstable ground for rural hospitals to operate on, according to a report by Chartis.
The study found that 46% of rural hospitals are in the red, while 432 facilities are at risk of closure. In comparison, the advisory firm's research from a year ago reported that 50% of rural hospitals were losing money and 418 locations were teetering on closing.
While the national median operating margin for rural hospitals is 1%, that figure is negative within 16 states, the report stated. States with the highest percentage of rural hospitals in the red are Connecticut (100%), Kansas (87%), Washington (76%), Oklahoma (70%), and Wyoming (70%).
There's also a significant discrepancy between states that have expanded Medicaid under the Affordable Care Act and that 10 states that haven't, the report highlighted. In expansion states, the median rural hospital operating is 1.5% and 43% of hospitals are in a deficit. In non-expansion states, which represent nearly 30% of all rural hospitals, the median operating margin is -1.5% and over half of hospitals are in the red (53%).
Overall, 182 rural hospitals since 2010 have either closed or converted to a model that does not provide inpatient care, including hospitals that switched to a long-term care model or a Rural Emergency Hospital designation.
Even when rural hospitals continue to offer inpatient care, it's often with reduced services. For example, the analysis found that between 2011 and 2023, 293 rural hospitals stopped providing obstetrics, which accounts for 24% of the country's rural OB units.
Rural hospitals are more susceptible to policies like reimbursement cuts, the study noted. According to the research, the 2% cut in Medicare reimbursement under sequestration will cost rural hospitals more than $509 million this year and result in over 8,000 jobs lost.
"Our analysis of population health domains indicates that rural hospitals will be challenged to meet the needs of vulnerable communities in the years ahead," Michael Topchik, executive director for The Chartis Center for Rural Health, said in the report.
However, researchers also pointed to programs and initiatives that are improving the viability of rural hospitals.
The Innovation for Maternal Health Outcomes in Minnesota " is improving outcomes in communities experiencing the highest rates of disparities, including rural communities," while the University of Rochester Medical Center's launch of telehealth stations in banks has improved access to care.
Jay Asser is the CEO editor for HealthLeaders.
KEY TAKEAWAYS
Nearly half of rural hospitals are in the red (46%) and 432 are in jeopardy of closing, Chartis' annual report on the state of rural health finds.
Medicaid expansion states have a higher median rural hospital operating margin (1.5%) than non-expansion states (-1.5%), which account for 30% of the nation's rural hospitals.
Since 2010, 182 rural hospitals have moved away from models that provide inpatient services, while many with inpatient care have cut down on services like obstetrics.