The U.S. healthcare system’s increasing complexity is taking an unbalanced toll on rural America. Shrinking access, growing health disparities and rising mortality rates put the well-being of 60 million people – roughly one in five Americans – at risk. The situation is dire, and immediate action is imperative to reverse that trajectory.
To increase access to high-quality care and help 700 rural hospitals facing closure, Intermountain Health, Microsoft, Gates Ventures, Epic and West Health recently formed a coalition to help meet rural patients’ needs and improve rural facilities’ financial health. In December, the group published a white paper that laid out solutions to create lasting, sustainable change.
Identifying the crisis’ depth
Rural hospitals are facing seemingly insurmountable obstacles: diminishing patient access, insufficient staff and unsustainable financial models. As bad as the situation is for these hospitals, it’s even more dire for rural communities. The Journal of the American Medical Association reveals roughly 20% of rural Americans live in counties without hospitals. Seven out of 10 reside in a county that doesn’t have a practicing oncologist. This reality underscores a troubling trend: Mortality rates that have nearly tripled in the last two decades for every leading cause of death, deepening disparities with urban populations.
The gap between urban and rural health includes staffing shortages. Health and Human Services Department data from September 2022 shows that more than 65% of primary care professional shortages were in rural areas. The Health Resources and Services Administration warns that by 2030, there will be a shortage of over 17,000 primary care physicians, and rural areas will be disproportionately impacted.
Related: Rural providers beg employers: No retirees in Medicare Advantage
Meanwhile, the Center for Healthcare Quality and Payment Reform’s 2022 data underscores the alarming financial situation at rural hospitals. Many facilities only have an average of 33 days cash available. In 13 states, rural hospitals have up to 19 days of cash on hand, leaving them on the brink.
Soaring costs and shifts in the payer landscape – as well as the discontinuation of specific specialties, including maternity, oncology, mental health, addiction and cardiovascular care – contribute to financial instability. The outcome: In the past decade, 136 rural hospitals have shuttered and 30% still face closure.
Partnering to implement innovation
Our coalition identified a “hub-and-spoke” strategy to help remedy the crisis. Through this approach, independent rural “spoke” hospitals partner with large “hub” health systems to access resources they cannot financially procure on their own. National systems extend their technology, staffing, medication discounts and other assets to rural hospitals to boost revenue, expand specialty care and narrow disparities. This strategy empowers rural hospitals to maintain their independence, stabilize their finances, keep more resources in the community and help patients find care closer to home – ensuring they are near family, friends and support systems.
Increasing clinical and telehealth capabilities is the most crucial intervention. According to the Rural Health Information Hub, rural patients travel twice as far for medical and dental care – and three times the distance for cancer treatment – as urban patients. Creating regional sites for critical specialty care services, such as oncology and transfusions, and establishing innovative delivery models for key services, including mobile mammography, also should improve care.
Furthermore, the availability of telehealth and other remote care models can reduce costs, increase provider-to-provider consultations and expand virtual care beyond voice and video calls. Innovations could include chat-based platforms, provider-to-patient messaging services and virtual triage engines.
Building a larger rural physician workforce is essential for access to high-quality care and improved patient outcomes. The coalition recommends:
• Expanding existing interstate licensing compacts to include telehealth services, connecting more physicians to more patients.
• Reviewing qualification criteria for rural placement of residents and early career doctor programs, including which specialties qualify for rural residency and are better served by rotational models, like The University of Washington’s WWAMI (Washington, Wyoming, Alaska, Montana, and Idaho) program.
• Easing J-1 visa requirements to boost the number of immigrant physician visas. The existing Conrad 30 waiver program ensures foreign doctors trained in the U.S. can stay to work in underserved areas for two years. We recommend loosening restrictions, which currently only allow each state to sponsor up to 30 doctors per year. Approving more J-1 visas can increase the number of eligible participants and rural care access.
Upgrading technology
Updating technological infrastructure not only protects rural hospitals from data breaches and cyberattacks; it also enhances system efficiency and accuracy. This is crucial to improve patient quality and safety. Rural hospitals must accelerate their technical maturity to bolster cybersecurity and partner with national hospital hubs to adopt their electronic health record (EHR) and revenue cycle software.
When rural facilities tap a large health provider’s EHR capabilities, they can experience as much as a 70% reduction in installation costs and a 40% decrease in maintenance costs. Moreover, the American Medical Association reports 62% of rural hospitals take a loss on privately insured patients and typically wait 30-60 days for those payments. Accessing a hub’s revenue cycle tool can empower spoke facilities to make more informed negotiations, amplifying health outcomes, lessening costs, reducing denial rates and boosting revenue.
Moving beyond operational sustainability
While the current situation is distressing, there is a path forward to stabilizing and improving the rural hospital model. The coalition’s vision extends beyond rebuilding a troubled business structure. It’s about reviving the health of communities and their economies. With advances in technology and healthcare delivery, proximity to a big city needn’t be a headwind in the health and well-being of people and their communities. Through our hub-and-spoke strategy, we’re confident urban-rural partnerships could revive America’s heartland.
Looking ahead
While these interventions can deliver lasting, transformational change, the coalition’s efforts are not limited to these solutions. The group will continue to seek out new partnerships with healthcare providers, policy advocates, technology companies and civic organizations to drive sustainability across America’s rural healthcare system. It’s only through these partnerships – and a deep commitment to meaningful action – that we can help these communities achieve better health for generations to come.
Read the organizations' complete rural health white paper.
Niranjan Bose is the managing director of Health and Life Sciences Strategy at Gates Ventures. Dr. Jackie Gerhart is the vice president of Clinical Informatics at Epic. Goutham Kandru is the associate director of Health and Life Sciences at Gates Ventures. Timothy Lash is the president of West Health. Dan Liljenquist is the chief strategy officer at Intermountain Health. Dr. Jim Weinstein is the senior vice president of Innovation and Health Equity at Microsoft.
