Report lists rural hospitals at risk of closing; see local data

Number of hospitals at immediate or high risk of closure before pandemic.
CHQPR map; click the image to enlarge it.

A newly updated report from the nonpartisan Center for Healthcare Quality and Payment Reform lists the more than 800 rural hospitals—40 percent of all rural hospitals in the U.S.—in danger of closing even before the pandemic. That includes over 500 hospitals that were at an immediate risk of closure because of longterm financial losses and lack of financial reserves. Another 300 hospitals are at high risk of closure in the near future, most because of low financial reserves or high dependence on revenue from non-patient sources such as local taxes or state subsidies. The report is based on the latest data from the Centers for Medicare and Medicaid Services.

Almost all of the rural hospitals at immediate risk are in isolated rural communities, making such locations all the more critical to locals, the report says. Almost every state had at least one rural hospital at immediate risk, and in 22 states, at least a quarter of rural hospitals are at immediate risk. In every state, more than 20% of rural hospitals are at high or immediate risk of closing, and in 14 states, the majority of rural hospitals are at high or immediate risk of closing. Click here for a searchable database of all rural hospitals in the U.S.

Many more hospitals may be at risk due to the pandemic. "Margins at many hospitals may be worse in 2020 because of the combination of the higher costs hospitals incurred during the pandemic and the reduction in revenues because patients avoided seeking non-emergency services," the report says.

"A major cause for financial struggles at rural hospitals is that they earn lower profits on basic services like emergency departments – a critical service in a rural community, but one that requires basic staffing and equipment costs that urban hospitals can more easily translate to profits," Erik Neumann reports for NPR affiliate Jefferson Public Radio in Oregon.

So says Center for Healthcare Quality and Payment Reform CEO Harold Miller, who noted that more than 130 rural hospitals have closed over the past decade. "In a small rural area, you don’t have as many emergency department visits as you do in a larger urban area. So, you don’t generate as many visits and you don’t generate as much revenue for those visits as you do in an urban area," he told Neumann.

Miller says the solution is to get private health insurance plans to pay enough for rural hospitals to stay afloat. "The hospitals are not losing money because they’re too expensive, they’re losing money because they don’t get paid enough to be able to sustain those services," Miller told Neumann. Here's another recent take on what the Biden administration can do to improve rural health care.

Click here for an interactive map showing at-risk hospitals in each state, and click here for a report overview and table with statewide figures.