Going Beyond Rural Hospital Closures
By Jose Fernandez, PHD
November 8, 2022
This week’s contributor is Jose M. Fernandez, an associate professor and Chair of the Economics Department at the University of Louisville. His research focuses on illicit drug use, risky behaviors and children with disabilities. Jose is a member of the 2022 Research Council.
In the last decade, more than 130 rural hospitals closed — a stat that’s regularly invoked as a shorthand for the plight of health care in rural America. Over the same time period, rural America’s population decreased for the first time in the country’s history. On the brightside, the Affordable Care Act increased insurance coverage more in rural counties than it did in urban counties.
Given the population loss and the increase in insurance, a natural question I have is: What happened to health care access and capacity, specifically around rural hospitals? A trio of articles, published in the latest issue of the journal Health Service Research, tackle this question.
First, researchers Paula Chatterjee, Yuqing Lin and Atheendar Venkataramani considered the ramifications of hospital closures on the economies of rural counties through a variety of variables, including unemployment rates, per capita income, total jobs and health care sector jobs. Comparing counties that experienced hospital closures to those that had not, they found a 13.8 percent decrease in health care sector employment. But surprisingly, there were no statistically significant changes in the other economic measures. The authors concluded rural counties that lost hospitals had already been experiencing economic downturns, independent of hospital closures.
Another article in the series looked at hospital capacity (i.e. number of beds) in rural hospitals. Researchers Thomas Hegland, Pamela Owens and Thomas Selden found rural hospitals had 20 percent greater capacity than urban hospitals, based on an expanded definition of a hospital market which extended beyond geographic boundaries and accounted for hospital transfers and multi-hospital systems. Rural hospitals had fewer staff and resources, but that did not lead to a reduction in quality, according to the study.
Our last paper found rural patients are often opting not to make use of all that space. Researchers Hannah Friedman and Mark Holmes found rural Medicare patients were increasingly likely to be admitted to urban hospitals rather than rural ones. While urban hospitals may have less capacity, the authors argue they often have a better mix of services than rural hospitals, making them more attractive to rural patients.
These studies have limitations that make it impossible to draw hard and fast conclusions, specifically about how these hospital closures affect the actual health of rural Americans. But, to me, they collectively suggest that looking at just one number — how many rural hospitals have closed — offers too simplistic a view of the state of rural health care. These studies highlight that we cannot treat rural health care delivery in isolation. Rather, there is an important interplay between rural and urban hospitals that needs further attention.