Medicaid Cuts Put Rural Hospitals in the Crosshairs

For facilities serving the uninsured, survival depends on government help

For the hundreds of rural U.S. hospitals struggling to stay in business, health policy decisions made in Washington, D.C., this summer could make survival a lot harder, according to a report from Kaiser Health News.

Since 2010, at least 79 rural hospitals have closed across the country, and nearly 700 more are at risk of closing, according to the article. These hospitals serve a largely older, poorer, and sicker population than do most hospitals, making them vulnerable to changes made to Medicaid funding.

The House bill to repeal the Patient Protection and Affordable Care aimed to cut Medicaid by $834 billion over 10 years, and the Senate revision of that bill reduces the program even more on a longer timetable. The Congressional Budget Office has not yet scored the Senate bill, but it said the House version would result in 23 million more people being uninsured during the next 10 years, although that number has been questioned.

Loss of coverage is a problem for small rural hospitals like Pemiscot Memorial in Pemiscot County, Missouri, which depends on Medicaid, according to the article. The hospital serves an agricultural county that ranks worst in Missouri for most health indicators, including premature deaths, quality of life, and adult smoking rates. Closing the county’s hospital could make those problems much worse.

Before 2005, things were different, the article says. The hospital was doing well, and Kerry Noble, CEO of Pemiscot Memorial Health Systems, commissioned a $16 million plan to overhaul the facility, which was built in 1951. But those renovations never happened. In 2005, the Missouri legislature passed sweeping cuts to Medicaid. More than 100,000 Missourians lost their health coverage, and this had an immediate effect on Pemiscot Memorial’s bottom line.

Approximately 40% of their patients were enrolled in Medicaid at the time, and nearly half of them lost their insurance in the cuts. Those now-uninsured patients still needed care, though, and as a public hospital, Pemiscot Memorial had to take them in.

For now, the hospital’s doors are still open. The facility has cut some costly programs (such as obstetrics), outsourced its ambulance service, and skipped upgrades.

“People might look at us and say, ‘See, you didn’t need Medicaid expansion. You’re still there,’” Noble said. “But how long are we going to be here if we don’t get some relief?”

Source: Kaiser Health News; June 23, 2017.