Only 16 hospitals have converted to rural emergency hospitals since the CMS designation was made available Jan. 1, but more may follow suit in the coming quarters as rural hospitals continue to be challenged by staffing shortages and rising costs, which are stifling recovery efforts and leaving some on the brink of bankruptcy or closure.
Since 2005, 100 rural hospitals have completely shut down, with another 95 facilities no longer providing inpatient services, according to data compiled by the University of North Carolina’s Cecil G. Sheps Center for Health Services Research. Thirty-seven of those rural hospital closures have occurred since 2020.
To address concerns that rural and critical access hospital closures are reducing access to care for people in rural areas, CMS established the rural emergency hospital designation, a new Medicare provider type.
The designation aims to curb rural hospital closures by offering them a chance to close infrequently used inpatient beds and focus on outpatient and emergency department services.
In exchange for giving up their expensive inpatient beds and focusing solely on emergency and outpatient care, rural emergency hospitals receive a 5 percent increase in Medicare payments as well as an average facility fee payment of about $3.2 million a year.
While the designation has helped some hospitals survive under a new provider type, others are still weighing the benefits and drawbacks of implementing such a drastic change to their services and business model.
The hospitals that have made the switch are predominantly in the South and in states that have not expanded Medicaid coverage. Here are the 16 facilities that have converted to rural emergency hospitals, beginning with the most recent:
- Harper Community Hospital (Buffalo, Okla.)
- South Central Kansas Medical Center (Arkansas City)
- St. Bernards Five Rivers Medical Center (Pocahontas, Ark.)
- Assumption Community Hospital (Napoleonville, La.)
- Sturgis (Mich.) Hospital
- TriStar Ashland City (Tenn.) Medical Center
- Stillwater Medical-Blackwell (Okla.)
- Blue Ridge (Ga.) Medical Center
- St. Luke’s Health-Memorial San Augustine (Texas)
- Jefferson County Hospital (Fayette, Miss.)
- Stillwater Medical-Perry (Okla.)
- Anson (Texas) General Hospital
- Alliance Healthcare System (Holly Springs, Miss.)
- Falls Community Hospital and Clinic (Marlin, Texas)
- Irwin County Hospital (Ocilla, Ga.)
- Crosbyton (Texas) Clinic Hospital
St. Bernards Healthcare’s Five Rivers transitioned to a rural emergency hospital on Sept. 1, the first hospital in Arkansas to do so.
With inpatient extended care accounting for only about 5 percent of the hospital’s business, the decision was a relatively easy one for the facility, Randy Barymon, the hospital’s administrator, told local news outlet KAIT8.
“Cost of care has certainly gone up, and reimbursement has gone up. It’s actually harder to get reimbursed for the care that we provide here at Five Rivers,” Mr. Barymon told KAIT8. “I think a lot of rural facilities are seeing a trend down inpatient extended-stay care. This was really just a natural progression for us.”
For Anson General Hospital, the decision to convert to a rural emergency hospital came down to survivability.
The Texas hospital reported three consecutive years of financial losses and patient volumes declined to about 1.7 inpatients a week, on average, partially due to factors related to the COVID-19 pandemic.
“Our numbers drastically declined, and we knew that this was our only hope to stay open,” Chief Nursing Officer Anna Doan, BSN, RN, told Becker’s.
The hospital filed its application in early January and, effective March 27, has been operating as a rural emergency hospital. CEO Ted Matthews retired from the hospital more than a decade ago and returned to helm the facility in February.
“We have embraced this new identity,” Mr. Matthews told Becker’s. “What it allowed us to do is continue to provide access to care. We were the only hospital at one time. Jones County had three hospitals, and we are the lone surviving hospital. And if we had to close, there would have been no hospitals in the county.”