Nearly 90 rural hospitals have closed since 2010, and hundreds more may be at risk of doing so. These closures, occurring primarily in states that chose not to accept federal funding for Medicaid expansion, often have severe health and economic effects on their communities.
Under the Affordable Care Act, the federal government provides millions of dollars to states that choose to expand their Medicaid programs to individuals with incomes below 138 percent of the poverty line, or approximately $16,000 per year. Rural hospitals have benefited in states with expanded Medicaid programs; according to one study, hospitals in expansion states saved $6.2 billion in uncompensated care, which would otherwise have eaten into the hospitals’ profit margins.
In contrast, rural hospitals in non-expansion states often have not been able to compensate for this lost revenue, leading to closures and, subsequently, limited access to health-care services and increased travel times for health emergencies. Research has linked longer travel time to hospitals with higher mortality rates for artery bypass graft patients and higher risks of death and other serious adverse events for trauma cases.
The closures have economic consequences as well, especially in rural communities and small towns where hospitals are among the largest employers. According to a Health Services Research study, when a community loses its only hospital, per-capita income falls by about 4 percent, and unemployment rises by 1.6 percent.
“Options are dwindling for many rural families,” Katy Kozhimannil, PhD, an associate professor at the University of Minnesota, told The New York Times, “and remote communities are hardest hit.”