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More than 700 rural hospitals across the U.S., including four in Indiana, are at immediate risk of closing because of serious financial problems they are experiencing, according to a new study.
The hospitals are not identified by name, but a map included in the study shows about 15 of Indiana’s 54 rural hospitals operating at an overall loss, or about 28% of the state’s rural hospitals.
The analysis, issued this month, comes from the Center for Healthcare Quality and Payment Reform, an independent policy center that focuses on improving health care payment and delivery systems.
The center periodically issues studies on the viability of rural hospitals, as well as other health care topics. For this study, it used hospital financial information from the Centers for Medicare and Medicaid Services.
Rural hospitals have long struggled to stay afloat, serving populations that are older, less healthy and less affluent than those of their urban counterparts. Nearly 130 rural hospitals across the nation have shut their doors since 2010.
Financial pressures at many rural hospitals include a low percentage of patients with private insurance and a lack of high-margin service lines, such as neurosurgery and orthopedic surgery, due to limited demand.
“Over the past two decades, nearly 200 rural hospitals have closed,” the report said. “As a result, the millions of Americans who live in those communities no longer have access to an emergency room, in-patient care and many other hospital services the rest of the country has taken for granted.”
The closings in Indiana have included Fayette Regional Health in Connersville (2019), Ascension St. Vincent Dunn Hospital in Bedford (2022) and the Indiana University Health Blackford Hospital’s emergency room and in-patient services in Hartford City (2023).
The hospitals at greatest risk of closing do not have adequate net assets to offset their losses on patient services for more than a few years.
“Rural hospitals are at risk of closing in almost every state,” the report said. “In the majority of states, over 25% of rural hospitals are at risk of closing, and in 10 states, over 50% are.”
Overall, more than one-third of rural hospitals lost money in 2023.
Many factors are pushing rural hospitals into red ink, including private insurance plans that pay less than what it costs to deliver services to patients. Other factors include Medicaid patients and uninsured patients.
Most at-risk hospitals are in isolated rural communities, where closure of the hospital would force residents of the community to travel a long distance for emergency or in-patient care, the study said.
Rural hospital patients are often farmers, small-business owners, retail workers and shop workers. The hospitals usually offer basic service lines, including emergency, general surgery and rehabilitation therapy.
The Indiana Hospital Association did not provide a comment by press time. The Indiana Rural Health Association did not return a phone call to IBJ.
Indiana actually has fewer hospitals in immediate danger than some its neighbors, including Michigan (7), Illinois (6) and Kentucky (6).
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