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Rethinking the Future of Rural Hospitals

February 9, 2015 BY DHC Marketing

Rethinking the Future of Rural Hospitals

The future of independent rural hospital facilities seems a bit bleak.

This may be because over the past five years, more than 40 rural hospitals have closed due to lack of funding.

Then with most of their funding coming from Medicare and Medicaid, programs that are estimated to make significant cutbacks in 2015 (such as Tenessee according to the Memphis Daily News), many more facilities may look to close as well.

In order to stay afloat, many rural independent hospitals are exploring other options in order to stay financially stable.

At the center of this is the debate around affiliations - should financially struggling rural and independent hospitals remain independent, or should the look to consolidate?

Definitive Healthcare’s hospital database currently tracks 1,329 critical access hospitals, 767 of which are independent and 562 of which are affiliated with a larger health system.

While selling out to a larger health system can be an easier way to get money and support, some rural hospitals choose to remain independent.

The choice to remain independent can allow these more ambitious hospitals ensure that their healthcare mission stays locally focused, allowing them to have more room to adapt to local needs, versus when independent hospitals join larger health systems they risk having their mission to help the local community become overshadowed.

Other tactics struggling rural hospitals are turning to have included creating limited but creative partnerships with larger systems. An example of this would be to create a relationship with a cancer unit of larger system or even a primary care physician service.

These partnerships, along with progressive executive leadership, leadership that is committed to the mission of providing local low cost care to their community, have also been found to be the types of facilities that flourished.

Additionally, a recent Health IT article also reported that business intelligence and analytics tool should be a key component of rural hospital’s strategies.

Another recent debate surrounding rural hospitals has also been the use of telemedicine as an alternative method to the in-person visit.

As these rural facilities have ripe conditions for more-for-less innovation, telemedicine have increasingly been argued as potentially advantageous.

As technology evolves and the healthcare market continually integrates, it will be interesting to keep an eye on the rural hospital market and how it will evolve.

For more related articles, check out these other posts by Definitive Healthcare:
- Top 10 Largest Independent Hospitals