1,000 rural hospitals could close
What’s going to happen to Macon, Missouri? And why should you care?
HFMA recently published an article written by staff member Rich Daly with this headline: “Public option could endanger 1,000 rural hospitals: analysis.” If that doesn’t get your attention, it should. Navigant conducted the study, essentially stress-testing three scenarios against the financial position of hospitals and arriving at the conclusion that, if a public option were enacted, 1,000 rural hospitals across 46 states would be at risk of closure, affecting 420,000 jobs. That’s 55% of all rural hospitals and, by some estimates, 20% of all hospitals.
I grew up in a Midwest town of 2,000 people, so I know the landscape. This must have been top of mind for me when I stopped briefly in Macon, Missouri, as I drove to Kansas City in August for the Region 8 HFMA meeting. Out of that stop came a new song I wrote by the same name about the decline of small towns. The opening line: “What’s going to happen to Macon, Missouri?”
So what is the future of our rural community hospitals? We will adjudicate which hospitals will make it and which ones will not. In some cases, the decisions will be made by design, driven by public policy. In other situations, it will be done by default, driven by demographics, geography and market dynamics. In the 1920s, about half our population lived in urban and suburban settings. Today that number is more than 80% and growing as young adults increasingly leave small and rural communities for urban areas.
The rural healthcare setting and challenges increasingly look like those faced by safety net hospitals in economically challenged urban neighborhoods and communities. Rural areas are in an economic decline and that is creating pressure on the healthcare delivery models. Payer mix is being challenged as the number of patients covered by private insurance declines while the number with government coverage increases. And the dollars available to care for the rural populations also have declined. Meanwhile, the rural geography and lifestyle make access to talent difficult, particularly for physicians and other clinicians with specialized skills.
If the HFMA headline above plays out, a significant portion of the United States will be without adequate healthcare options. The resulting problems, like those in economically challenged urban settings, would not impact just those communities. The problems would impact us all.
As a cohort of more than 40,000 members across HFMA, we are in a unique position to seed the solutions. With HFMA tools, resources and relationships, we can have a profound influence. I dare you to move!