Closures of rural hospitals hurt local economies

Some rural hospitals in states that chose not to expand Medicaid under federal health reform have struggled to remain open. When a hospital closes, residents not only lose their local source of medical services, but the closing also adds to the financial woes of the area, Adam Ragusea reports for Marketplace. (Ragusea photo: An overgrown sign at the closed Hancock Memorial Hospital in Sparta, Ga.)

University of North Carolina professor Mark Holmes studied the economic impact of 140 rural hospital closures nationwide, finding that "Three years out, losing a hospital costs a community, on average, 'about 1.6 percentage points in unemployment, about $700 in per capita income, and that was in 2000 dollars, so that’d be probably about $1,000 currently,'" Ragusea writes.

After four rural hospitals closed in Georgia in the past year, Republican Gov. Nathan Deal proposed a plan to help ailing hospitals—and those that were recently shuttered—to offer only more limited services such as emergency care. State Community Health Commissioner Clyde Reese "says America’s healthcare system doesn’t provide enough ways for the operator of that kind of place to get paid," Ragusea writes. Reese told him, “They’re not going to be hospitals; they won’t be reimbursed as hospitals; they won’t be able to charge a facility fee; they won’t get the Medicaid add-on rate, etc.” (Read more)