Rural hospitals on the brink due to COVID-19
The COVID-19 pandemic has placed a significant and unexpected financial burden on rural health-care providers who were already struggling to maintain hospitals and clinics that help keep small-town residents — and their communities — alive and well. A slowdown in patient visits and drop in medical procedures due to fears of spreading the virus have led to a major loss of revenues for medical providers and health-care systems that serve rural areas. While the virus has not led to mass infections in small towns, the drop-off in activity and billable services has put stress on the already fragile financial state of many rural clinics, small hospitals and dental offices. With the first wave of the pandemic possibly over, more safety measures in place and life returning somewhat to normal, most clinics and hospitals in rural South Dakota have headed off any imminent concern of closure. Yet in a rural health-care system made up of a patchwork of providers and hospital systems, the losses from the pandemic could curtail the hiring of health-care workers, slow plans to expand services, and further restrict access to health care for hundreds of thousands of small-town and rural residents of the state. In a state of 885,000 people spread out over roughly 76,000 square miles, and with only nine of 66 counties having more than 20,000 people, South Dakota is among the most rural of all states and home to a heavily diffused population. Even before the pandemic, that equation presented a major challenge for health-care providers to serve small-town and remote populations, and do so in a financially viable manner. Likewise, rural residents have a hard time getting adequate preventive, maintenance, emergency and palliative health care. “Do I think rural health care is at risk? Absolutely,” said Thomas Worsley, president of Spearfish Hospital and Hills Markets for Monument Health, the largest medical system in West River with its flagship hospital in Rapid City and smaller facilities in Hot Springs, Custer, Sturgis, Lead-Deadwood, Wall and Buffalo, among others. “It’s always going to be at risk because it’s not a profitable endeavor or something that is going to attract big dollars, but it’s something that fills a real need in these rural communities.” Worsley, who also serves on the Future of Rural Health Task Force within the American Hospital Association, said the challenge for rural health-care providers and hospital groups is to maintain the highest level of care possible while also protecting the overall financial viability of the health-care system. “If you polled all these rural health-care CEOs [on the task force], I think they all feel like they’re fighting for their lives on a daily and yearly basis,” he said. Thomas Worsle “Do I think rural health care is at risk? Absolutely. It’s always going to be at risk because it’s not a profitable endeavor or something that is going to attract big dollars, but it’s something that fills a real need in these rural communities.” — Thomas Worsley, Monument Health Horizon Health Care, a rural health provider with more than two dozen medical and dental clinics in small towns across South Dakota, saw its revenue fall by roughly half in the weeks after the pandemic hit and patients began staying home, according to Wade Erickson, chief financial and operations officer. By early June, patient activity and revenues had returned to about 90% of normal, Erickson said, and the group benefited from receiving about $3 million in emergency aid from the federal CARES Act pandemic bailout fund. The aid and bounceback in procedures have been critical to Horizon, based in Howard, S.D., but especially to its patients in rural communities who are never turned away because of ability to pay, Erickson said. About a third of Horizon’s funding comes from the federal government, and about 20% of its patients are uninsured. “In really rural communities where we are, just about touching every corner of South Dakota, we’re really the only access to care that they have,” Erickson said. Access to health care remains a serious challenge in much of rural South Dakota, where federal data show that residents tend to have greater rates of serious illness and death from diseases and far less access to doctors, nurses and dentists than in the state’s few urban areas. Rural residents “face a unique combination of factors that create disparities in health care not found in urban areas,” according to the National Rural Health Association. The South Dakota Office of Rural Health has performed a needs assessment that ranks all 66 counties in terms of resident health status, access to health care and other health-risk factors. Ten counties — all rural and several home to Native American reservations — have consistently ranked in the bottom quartile in all health and access categories (Buffalo, Bennett, Corson, Dewey, Gregory, Jackson, Mellette, Roberts, Todd and Ziebach.) The pandemic has heightened the challenge of providing medical care to rural areas and small towns that the vast majority of South Dakotans call home. In rural South Dakota, serious health problems are more common while health care is less accessible. Rural South Dakotans have a higher rate of death from many health conditions, a higher prevalence of poverty and less access to health-care providers than non-rural residents, according to data from the Rural Health Information Hub. The following data show the rate of death per 1,000 residents or the prevalence of diseases in percentages in non-rural (metro) and rural (non-metro) areas. Meanwhile, doctors, dentists and nurses are far less accessible to rural residents of South Dakota compared to non-rural residents. The data indicate the number of practitioners available per 1,000 residents in 2018. Notes: Death rates are rates per 1,000 residents from 2005-2016; illness percentages are from 2018; life expectancy is from 2014. Rural/non-rural designation based on population of counties. Sources of data include National Center for Health Statistics, Health Resources & Services Administration, Kaiser Family Foundation and U.S. Census. The rural medical system in South Dakota varies by location, but in general, health care is provided through an informal continuum of care in which patients must travel more owing to the remoteness of their residence or as their care needs increase. The smallest towns and most remote areas likely have no local health-care provider; as towns get larger, they are more likely to have non-emergency clinics that provide basic diagnostics or treatment during regular business hours; medium-size cities often have a “Critical Access Hospital” with 24/7 emergency services and greater diagnostic and treatment capabilities that qualify for significant federal funding; and urban areas are home to full-service hospitals with critical care, extensive diagnostics, multiple surgical options and specialty providers. In major medical emergencies, rural residents can expect to drive hundreds of miles or pay for a ride in an ambulance or a helicopter in order to survive, making local ambulance services and emergency medical technician teams critical elements of the health-care delivery systems in rural areas. During the pandemic, the urban medical centers in South Dakota collectively lost hundreds of millions of dollars in revenue due to a lack of elective surgeries and routine and preventive care. Though federal emergency funding has helped counter those losses, some staff was laid off and the long-term impacts are still unknown. ..The drop in people seeking medical treatment during the pandemic may have unexpected consequences, including among patients who miss an annual physical and could be exposed to greater danger from slow-developing illnesses such as skin cancer.
Medicare for All would crush rural hospital reimbursement rates
Adopting a single-payer government health care program that covers all Americans would force more rural hospitals to close, according to hospital administrators from Texas to Maine. Universal health care — also known as “Medicare for All” — is a long way from becoming law. But the issue is already dividing Democrats trying to unseat President Trump in the 2020 election. Get the editor’s can’t miss stories of the week, and tips for navigating life – and weekends – during the coronavirus outbreak. Sign up now. Some progressive front-runners like Elizabeth Warren and Bernie Sanders say they’d be willing to do away with private insurance in favor of a government plan. Moderates have balked at that idea — and at the price tag. Here’s how former Rep. John Delaney put it during the Democratic debate in June: “If you go to every hospital in this country and you ask them one question, which is, ‘How would it have been for you last year if every one of your bills were paid at the Medicare rate?’ Every single hospital administrator said they would close.” “Congressman Delaney is wrong — full stop,” says Craig Garthwaite, a health care economist at Kellogg School of Management at Northwestern University. Garthwaite says it’s more likely hospitals will be forced to scale back services, amenities and staff under a Medicare for All system. We’re going to get a different kind of hospital going forward and we’ll have to decide if that’s what we want,” he says. “But it’s hyperbole to say all hospitals will close.” But that is the position of hospital executives at Central Maine Healthcare. About two-thirds of patients using the company’s two critical-access rural hospitals are covered by either Medicaid or Medicare. The government pays the hospital 99% of allowable Medicare costs, says Peter Wright, who runs the company’s Bridgton and Rumford hospitals. That means — hypothetically — if an X-ray costs $100, Medicare will reimburse the hospital $99. “It doesn’t leave us any surplus funds to reinvest in our facility, to reinvest in our equipment, reinvest in our people,” Wright says. On the other hand, he says about a quarter of his patients use private insurance, which pays well above $100 for the same X-ray. “If you’re talking about Medicare for All and turning every one of our patients into a Medicare patient, we’d probably end up closing our doors eventually,” he says Across the country, 113 rural hospitals have closed since 2010, according to University of North Carolina researchers. Population loss in rural areas and increasing technological demands of a modern health care system have made it difficult for these hospitals to maintain the revenues they need to operate.