Rural hospitals nationwide are facing a host of financial challenges, but states can still take action to keep them open, the head of a rural health group told the Governor’s Rural Health Working Group on Wednesday in Topeka.
Alan Morgan, CEO of the National Rural Health Association, said that people in urban areas have a few explanations for why rural hospitals are struggling: irreversible population decline in rural areas, low-quality care and bad management practices.
In fact, he said, rural population across the nation appears to be stabilizing, rural hospitals do as well as or better than urban hospitals on quality measures, and insurance companies have struggled with the economics of serving rural populations.
However, he said, that doesn’t mean the problems of rural hospitals are an urban exaggeration. If hospitals continue to close at the current rate, about one in four rural hospitals will close in the next 10 years, Morgan said. A study released earlier this year by the NRHA and iVantage found that 673 U.S. hospitals, including 29 in Kansas, were at risk of closing in the next decade.
Gov. Sam Brownback announced formation of the working group in January to address the challenges of health care delivery in rural Kansas.
Part of the challenge is that rural residents tend to have more health problems than people who live in urban areas, Morgan said, and rural communities have been hit especially hard by increases in opioid abuse and other behavioral health issues. That translates into a disproportionate number of patients who can’t afford preventive care and use the emergency room for treatment, he said.
“We have a low-income population with great health needs,” he said.
Since 2010, hospitals also have been hit with a series of financial blows, including federal budget cuts associated with sequestration, reduced Medicare reimbursements under the Affordable Care Act and a shift toward outpatient care, Morgan said.
Until that time, most rural hospitals operated with from roughly a 2 percent profit to a 2 percent loss, he said. Now, the average is closer to running in the red by 6 percent.
“We have a low-income population with great health needs.”- Alan Morgan, CEO of the National Rural Health Association
Rural hospitals also disproportionately suffer from difficulty recruiting health care providers, and many are burdened by debts or old facilities that aren’t well-suited to providing the outpatient care that people use more often now, Morgan said.
“These hospitals are still structured like they were in the 1940s,” he said.
States and communities are exploring ideas to stabilize rural hospitals, Morgan said. No one has found a silver bullet to solve the problem, but he said some show promise. These include efforts to:
- Set up programs to encourage rural teens to pursue health care as a career. Providers who grew up in rural areas and do a residency there are more likely to stay.
- Expand the roles of people without a medical degree, such as paramedics, patient navigators and community workers who provide health information.
- Allow nurse practitioners, physician assistants and dental therapists to practice more independently, with a physician or dentist on call.
- Evaluate what services a community needs from its hospital.
- Increase the use of telemedicine to support rural providers.
- Offer grants to help hospitals cross the “shaky bridge” between payment models.
The one thing states shouldn’t do is wait for the federal government to come up with a model based on what works in urban areas, Morgan said.
Lt. Gov. Jeff Colyer, who leads the nine-member work group, said some of the ideas Morgan brought already are moving forward in parts of Kansas. The key will be rewarding successful initiatives and finding “blockages” in the system that prevent innovation, he said.
“Kansas is actually a pretty innovative place itself,” Colyer said.