Longstanding Pressures Contribute to Record Rural Hospital Closures

By: McKesson Health Systems Editorial Team

Read time: 4 minutes

In rural communities across America, hospitals and health systems provide much needed access to affordable, quality healthcare for patients close to home, and operate as economic anchors in their local communities. Rural hospitals make up about 35% of all hospitals int he U.S.¹

Over the last decade, 136 rural hospital and health systems have closed in the U.S. according to UNC Cecil G. Sheps Center for Health Services Research. In response, the American Hospital Association released a new report highlighting the variety of causes that resulted in a record 19 closures in 2020 alone. These include many longstanding pressures, such as low reimbursement, staffing shortages, low patient volume, and regulatory barriers, as well as the continued financial challenges associated with the pandemic. Recently, expenses for labor, drugs, supplies and equipment have also increased dramatically, ultimately causing difficulties in maintaining access to care for people in rural communities.

Key report findings include:

• 136 rural hospitals closed between 2010 and 2021, according to the UNC Cecil G. Sheps Center.
• 74% of rural closures happened in states where Medicaid expansion was not in place or had been in place for less than a year.
• Rural hospitals face significant staffing shortages. Nearly 70% of the primary care Health Professional Shortage Areas (HPSAs) are located in rural or partially rural areas.
• Slightly more than half of the hospitals that have been closed were independent.
• Despite facing ongoing challenges, a number of pathways exist for rural hospitals' financial sustainability.

You can view the full Rural Hospital Closures Threaten Access: Solutions to Preserve Care in Local Communities report here.

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¹Fast Facts on U.S. Hospitals Infographics | AHA