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A Look at Rural Hospital Closures and Implications for Access to Care: Three Case Studies

Executive Summary

The number of rural hospital closures has increased significantly in recent years. This trend is expected to continue, raising questions about the impact the closures will have on rural communities’ access to health care services. To investigate the factors that contribute to rural hospital closures and the impact those closures have on access to health care in rural communities, the Kaiser Commission on Medicaid and the Uninsured and the Urban Institute conducted case studies of three hospital closures that took place in 2015: Mercy Hospital in Independence, Kansas; Parkway Regional Hospital in Fulton, Kentucky; and Marlboro Park Hospital in Bennettsville, South Carolina. Two of these hospitals were in states that did not adopt the Medicaid coverage expansion under the Affordable Care Act (ACA) (Kansas and South Carolina), while one of the hospitals was located in a Medicaid expansion state (Kentucky). Key findings include the following:

A number of factors contributed to the rural hospital closures, including aging, poor, and shrinking populations, high uninsured rates and a payer mix dominated by Medicare and Medicaid, economic challenges in the community, aging facilities, outdated payment and delivery system models, and business decisions by corporate owners/operators.

The hospital closures reduced local residents’ access to care, especially emergency care. While inpatient hospitals in these and other communities may not be sustainable, without new models of health care delivery in place, hospital closures can lead to gaps in access. The closures led to an outmigration of health care professionals and worsened pre-existing challenges around access to specialty care. Some communities were able to adapt to fill in gaps in access to primary care. Elderly and low-income individuals were more likely than others to face transportation challenges following the closures, and were thus more likely to delay or forgo needed care.

New care models may be better able to address the health care needs of rural communities.  Some rural hospitals may be able to adapt and new models may be created to address changing demographics and delivery systems.  Such reconfiguration may require federal support and assistance as well as regional planning efforts. A state’s decision about the Medicaid expansion has an important impact on hospital revenues and access to care, but the sustainability of rural hospitals depends on a broader set of factors.

Issue Brief

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Filling the need for trusted information on national health issues, the Kaiser Family Foundation is a nonprofit organization based in Menlo Park, California.