by Tina Reed |
Feb 20, 2019 8:00am
Unless their financial situations improve, at least 21% of rural hospitals in the U.S. are at high risk of closing, according to a new report from Navigant.
In all, at-risk hospitals represent more than 21,000 beds staffed by 150,000 employees and $21.2 billion in total patient revenue. Of high-financial-risk rural hospitals, 64% of them are considered essential to their communities based on their trauma status, service to vulnerable populations, geographic isolation and economic impact.
Officials called for solutions such as advancing legislation around telehealth reimbursement and such bills as the Rural Emergency Acute Care Hospital Act.
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The report comes just a day after the largest hospital groups around the country called on congressional leaders to delay the start of $4 billion in Medicaid disproportionate share hospital cuts, which are scheduled to begin Oct. 1, 2019.
• Mississippi has 31 rural hospitals at high risk of closure if their financial situations don’t improve, making up nearly half of their rural hospitals. Alabama is at risk of losing 21 of its rural hospitals, representing exactly half of its rural hospitals.
• Of Montana’s 12 at-risk rural hospitals, all of them are considered essential to their communities. Kansas has 29 total at-risk rural hospitals with 25 of them—or 86%—considered essential to their communities. Georgia and Mississippi have seen 77% and 61% of their essential rural hospitals at financial risk, respectively.
• At 127, Texas has the most rural hospitals by far. But less than 10%, or 12 rural hospitals, are at great financial risk.
• Four states have no rural hospitals at risk including Massachusetts, Maryland, Utah and Vermont.
What’s driving this problem?
While rural hospitals face unique challenges to delivering healthcare, a number of emerging issues—from the opioid epidemic and cybersecurity threats to high drug costs and workforce shortages—could exacerbate their financial instability, according to a recent report from the American Hospital Association.
The overall degradation of the payer mix is a factor as well, in part because of a loss of agricultural and manufacturing jobs, the authors of the report said.
Navigant also pointed to declining inpatient care as the overall health system pushes to value-based care in outpatient settings. That “left many rural hospitals overstaffed and underused,” the report said, with average rural hospitals having 50 beds and 321 employees but a daily census of just seven patients.
Rural hospitals are also generally already budget-strapped and unable to keep up with technological trends.