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Assessing the Health of Rural Hospitals during COVID-19

May 11, 2022

The nation’s rural hospitals faced financial pressures and workforce shortages prior to COVID-19 and will need additional support to avoid closure in the years ahead, according to a new report on rural health care.

The report released this month from the Bipartisan Policy Center (BPC) focuses on rural hospitals’ financial strain and workforce challenges, and the potential solutions to ensure rural residents have access to health care in their communities.

More than 115 rural hospitals closed between 2010 and 2019, but additional federal relief during the pandemic helped support hospitals on the brink of closure or downsizing. The BPC report includes analysis from rural health systems in eight states, as well as other health policy experts specializing in rural health care.

Rural hospitals care for a large share of Medicaid and Medicare beneficiaries. In rural areas across the U.S., 1 in 3 individuals are enrolled in Medicare, and 1 in 4 people under 65 are enrolled in Medicaid, Julia Harris, senior policy analyst for BPC’s health project, said in a statement.

“While all payers must be part of the solution to ensure quality health care services remain accessible in rural America, our report focuses on strengthening health care delivery in Medicare and Medicaid given the outsized role these public programs play in rural communities,” she said.

Here are five takeaways from the BPC report:

  • Uncertain transition:  Once the federal funding from COVID-19 expires, rural health systems may face significant financial pressure and struggle to maintain services. About 440 of 2,176 rural hospitals have three or more concurrent financial risk factors for closure or downsizing, the report notes.
  • Longer travel times:  Following a rural hospital closure, the median travel distance for substance use treatment services increased to 44.6 miles in 2018 (up from 5.5 miles in 2012), according to a report from the U.S. Government Accountability Office.
  • Future of flexibilities:  The ability for patients to receive telehealth from their homes helped maintain access to care in rural areas and will be an important tool if the flexibilities are extended beyond the pandemic.
  • Transformation models:  The report notes the need for new rural care delivery models, and cites the potential of Pennsylvania’s Rural Health Model as one example.
  • Quotable:  “As the Centers for Medicare and Medicaid Innovation (CMMI) tracks progress for these models and similar programs, BPC encourages the secretary of HHS to use lessons from the initiatives to establish multipayer global budget initiatives that are tailored to rural communities and to provide additional opportunities for rural providers to transition to value-based care,” the report says.

The full report is available online. It includes recommendations to stabilize rural hospitals, advance innovative delivery models, and support the rural health workforce.

HAP is committed to supporting Pennsylvania’s rural hospitals to ensure they remain anchors within their communities. This includes advocating for policies and legislation that support their health care workforce and new models of care. 

HAP supported the creation of the Pennsylvania’s Rural Health Model, which provides financial stability for rural hospitals and rewards innovative approaches to delivering health care.

For more information about Pennsylvania’s Rural Health Model, contact Kate Slatt, HAP’s vice president, innovative payment and care delivery.