"In the year before their closure, most of the now-closed rural hospitals nationwide had low cash on hand, negative operating margins, and negative total margins, compared to rural hospitals that stayed open," Clarissa Donnelly-DeRoven reports for North Carolina Health News. Those last two factors means they lost money. Though buyouts from larger health systems and subsequent consolidation might be responsible for a few closures, the researchers found that the vast majority closed for financial reasons. Though this study didn't examine the role of Medicaid expansion in keeping rural hospitals open, a 2018 study out of Colorado found that it makes a big difference in keeping rural hospitals open.
The study was a collaboration between the North Carolina Rural Health Research Program and the Cecil G. Sheps Center for Health Services Research at the University of North Carolina Chapel Hill. UNC researcher George Pink, one of the authors, said the study is the first he's seen that analyzes a hospital's finances immediately before its closure, Donnelly-DeRoven reports. How does your local hospital score? If it won't tell you, trouble may be brewing.
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