453 rural hospitals are failing — Medicare for All would save them

Our for-profit health care system isn’t working for rural Americans. More than 120 rural hospitals have closed since 2010. According to a new report from Chartis Center for Rural Health, another 453—almost one in four—are at risk of failing. Corporate health insurers can’t provide coverage to meet rural patients’ needs, and it’s endangering the bottom line of rural hospitals. Medicare for All would save them.

In congressional testimony, Dr. Jessica Banthin, Deputy Assistant Director for Health, Retirement, and Long-Term Analysis at the Congressional Budget Office, explains that enacting single-payer Medicare for All could keep rural hospitals afloat. Everyone would have good coverage. And, hospitals would be compensated at Medicare rates, or better, for the care that they deliver.

Other health care reform proposals that allow people the option to buy into Medicare, such as a “public option” or “Medicare buy-in,” would not ensure rural residents access to care. A new study published in the Lancet by Yale Professor Alison Galvani et al. finds that these proposals would drive health care costs higher. Health care would continue to be unaffordable for much of rural America. Thousands of rural Americans would continue to die unnecessarily each year.

Right now, our for-profit health care system leaves millions of rural residents uninsured or underinsured and unable to get the care they need. It is not designed to serve rural communities. Mountains of research show that rural Americans with low incomes and chronic conditions often cannot afford needed care or coverage. Not surprisingly, the 46 million rural residents — one in six Americans—have far poorer health outcomes and lower life expectancies than Americans living in urban areas.

Because rural hospitals are not reimbursed for much of the care they deliver, many of them cannot generate the revenue needed to serve their communities. Nearly four in 10 rural hospitals are unprofitable. Low patient numbers contribute to the problem. Hospitals are cutting services and closing. Rural Americans sometimes must travel 30 miles to the nearest hospital.

Public health insurance helps rural hospitals to a limited extent. Rural hospitals are stronger in states that have expanded Medicaid under the Affordable Care Act. The uninsured rate in those states for people with incomes under 138 percent of the federal poverty level has dropped from 35 percent to 16 percent. Medicaid provides necessary revenue to hospitals in those states. But 14 states have not expanded Medicaid, and the Supreme Court ruled that Congress cannot require states to expand Medicaid.

Moreover, if the Trump administration is successful at repealing the Affordable Care Act, which covers the cost of Medicaid expansion, uninsured rates will rise significantly and hundreds more rural hospitals will be at risk. Rural Americans living in the South and in states that have not expanded Medicaid have witnessed the highest number of hospital closures.

In states that have not expanded Medicaid, rural hospitals must serve more uninsured patients and deliver a significant amount of uncompensated care. Nearly one in three people with incomes under 138 percent of the federal poverty level are uninsured.

Residents of Texas, Tennessee, Oklahoma and Georgia—none of which expanded Medicaid—are among those at greatest risk of losing access to hospital care. Over the last 10 years, Texas saw 20 rural hospitals close and Tennessee saw 12 hospitals close. Oklahoma and Georgia each saw seven hospitals close.

Beyond struggling to meet their health care needs, rural patients are often burdened with sky-high medical debt. Many are low-wage workers, with little hope of paying off their hospital and medical bills. Rural hospitals and doctors have taken to suing patients for the cost of their care. Thousands of rural Americans are jailed or threatened with jail each year when they don’t show up in court for unpaid medical bills.

With Medicare for All, Congress would ensure the viability of rural hospitals. Rural hospitals would be properly compensated for the care they deliver, strengthening their balance sheets.

Medicare for All’s guaranteed health care coverage would ensure that rural Americans could get the health care they need, without fear of medical debt. Medicare for All eliminates deductibles and coinsurance, treating rich and poor equally instead of rationing care based on ability to pay.

The cruel and discriminatory logic of the marketplace should not mean that rural Americans go without needed care.

Diane Archer is a senior adviser at Social Security Works.