The Big Story: Chartis 2025 Rural Health State of the State
“Across the US, the rural health safety net remains under intense pressure. Since 2010, 182 rural hospitals closed or converted to an operating model that excludes inpatient care. According to our newest analysis, 46% of rural hospitals are in the red, and 432 are vulnerable to closure. This loss—and potential future loss—of access to care is compounded by rural America’s weakening population health status and expanding “care deserts” for vital services.”
Of Headwinds, Community and Creative Solutions
4-minute read
If rural healthcare were your patient, you’d rush them to your ICU. STAT.
The bad numbers from last year have mostly gotten worse, according to the latest bracing data from our Chartis colleagues. More than half of the rural hospitals in states that have not expanded Medicaid are facing negative margins with few encouraging signals in their financial EKG.
Left unattended, the prognosis is dire.
But, to overstretch the analogy, there are care paths worth considering that may yet offer hope for this critical element of healthcare delivery. But first, some diagnostics.
- The population double whammy. In many rural communities, populations are either not growing or are shrinking, leading to a smaller remaining patient base that tends to be aging and carrying higher rates of chronic disease. Fewer and sicker people is a challenge because the volume and reimbursement don’t align to cover the cost of adding specialty services. Rural hospitals are simply trying to maintain what they have today: primary care, chronic disease management, maybe some cardiac care and oncology. OB if you’re lucky.
- Bricks and mortar in decline. Meanwhile, buildings and equipment are aging right along with the patients. There’s not enough revenue to make necessary updates – a situation exacerbated by the high rates of Medicaid and Medicare Advantage coverage among rural populations that bring in less reimbursement than a payer mix weighted more towards private insurers.
- Recruitment challenges. Even if finances and volume allowed, the physician shortage makes it tough to staff new services. Rural providers are constantly working to backfill physicians in primary care, OB/GYN and “basic” but still relatively rare specialties like GI and anesthesia. Many doctors aren’t choosing primary care; few are choosing rural settings.
And yet: Remarkable creativity is coming out of rural healthcare to address these problems.
At the top of the list is a growing roster of rural providers partnering with academic medical centers to build rural residency programs. The Rural Family Medicine Residency at ECU Health and Brody School of Medicine combines the resources of a cutting-edge academic medical center with primary care training in rural community-based FQHCs and community teaching hospitals.
An even longer-term play is to attract trained individuals back to their rural hometowns. We’re hearing of pushes to provide grants and scholarships for high school students to help cover their higher education and then bring that new profession back home, or to help pay education debt of local clinicians.
A sense of community
Rural residents want – and expect – more. But they’re also comfortable with the realities of rural living. For many, living in such a community is a feature, not a downside. Many residents feel close to healthcare workers in their communities – their neighbors.
At the same time, there’s also a willingness to travel to get that specialty care. A recent Jarrard Market Research & Insights survey in North Carolina for Rural Healthcare Initiative found that 75% of rural residents are willing to travel further for greater expertise and to see clinicians who do more volume.
That deep local connection coupled with a broader perspective about the continuum of care is a good combination for providers looking to adjust services and partner with others to provide sustainable rural care.
What does all this tell us about steps providers can take toward more sustainable care?
Work with the community. Losing services like OB means losing things that would contribute to a growing, younger population and economic development.
Publicly owned organizations can make that case to their legislature for support through grants or a tax levy. In our experience, many communities are open to this, knowing those funds go directly to help improve local health. In a related thread, Pennsylvania recently advanced legislation making it easier for small towns to levy taxes for emergency services.
But even private organizations can use the government relations approach. Build a roadshow to explain the organization’s mission and what it does for locals. Advocate for support and legislation that will keep the doors open. Leverage the public’s trust in doctors, nurses and provider organizations to push for needed change (or stability).
Tell the story. Rural hospitals serve a wide and vital purpose. They provide healthcare to aging populations and to those with greater needs. They are major employers, economic engines, trusted voices.
Emphasize that role to leaders at all levels, from local businesspeople to state and federal lawmakers. Ensure they know what the organization is doing to serve the community, as well as the headwinds challenging them. Paint the picture, so influential individuals and the community at large have full understanding of the implications and the day-to-day realities for local rural providers.
Work with caregivers. Our consumer research consistently shows nurses and physicians are the most trusted voices out there, making them the best advocates for the organizations where they work. Yet, at the same time, we see greater skepticism among healthcare workers themselves. In RHI’s North Carolina work, survey respondents in healthcare households express lower satisfaction with healthcare in their area on several measures.
The community trusts these individuals because they’re friends and neighbors, and people connect with who they know, not a building or institution. Make sure you are meeting these caregivers’ needs first. Then ask for their help as ambassadors to your mission.
Pursue unique partnerships. It’s not just about M&A but creating other collaborations with healthcare and community organizations. For instance, many rural hospitals are pursuing joint ventures to begin closing the massive behavioral health gaps in their communities (and it’s not just rural providers taking this approach). Work with social organizations so the hospital isn’t trying to do everything or, worse, duplicating effort. Find friends to help carry the weight.
Finally: In this noisy moment, stay focused on serving the community. Politics and policy matter, but nothing should take away from keeping the aim of caring for people at the center of everything.
Contributors: David Shifrin, David Jarrard, Emme Nelson Baxter, Isaac Squyres
Image Credit: Shannon Threadgill
