By Katelyn Newman, Staff Writer – US News & World Report
IN NOVEMBER 2017, A Southern town that was home to the nation’s first 911 call was hit with hard news: Its local hospital would close its doors by year’s end.
With Lakeland Community Hospital gone, the closest emergency room for residents of Haleyville, Alabama – a town of about 4,000 people – would be at least a 45-minute drive away, and the community would lose one of its largest employers. Mayor Ken Sunseri says he began making calls – to other hospitals in the region, to local legislators who had faced similar situations, to his U.S. congressman’s office and to potential investors – to figure out how to keep Lakeland open.
The repeated response he got: Take ownership of the hospital, the only one in Winston County. So that’s exactly what the community did.
Hospital employees worked extra shifts as Sunseri and the City Council worked on the necessary contracts, partnerships and loans to acquire the facility from Tennessee-based Curae Health, which filed for bankruptcy late last year. Officials cut the number of inpatient beds from 59 to 49, and local authorities approved a 1-cent sales tax, as well as a county property tax increase, to help fund hospital efforts.
A city and county authority now owns Lakeland, which is operated by Java Medical Group.
“Nobody likes an increased sales tax – that’s a reelection death notice,” Sunseri says. But “I never received one negative phone call over the tax increase. So I felt like we had the community’s support, and they want that hospital and they want it there.”
The success of the effort to salvage hospital access in a slice of rural Alabama comes as dozens of hospitals in similar areas across the country have struggled to stay open in the face of financial distress and recruitment challenges.
Since 2010, more than 100 rural hospitals have shut their doors, according to The Cecil G. Sheps Center for Health Services Research at the University of North Carolina–Chapel Hill. Six of those hospitals were in Alabama, with the most recent closure occurring in March.
“Simply stated, rural hospitals are anchor institutions – their success or failure dictates the success or failure of the community itself,” says Alan Morgan, chief executive officer of the National Rural Health Association. “There’s so many other health care services that are anchored into these rural hospitals. So hospitals, schools, small business – if you pull the leg out on one of those three, you’re going to lose the little town.”
According to Morgan, hospitals in an initial wave of closures were located predominantly in low-income communities of color with high rates of Medicaid coverage. The public health insurance program tends to reimburse health care providers at a lower rate than private carriers, which can eat away at a hospital’s bottom line. At the same time, states that haven’t expanded Medicaid coverage – like Alabama – can be hit especially hard, with hospitals providing pricey, unreimbursed care to large pools of people who don’t have any insurance at all.
Another challenge facing rural and urban hospitals alike is the limited number of new physicians entering the field as older physicians retire, says Susan Salka, CEO of AMN Healthcare Services, a health care staffing company.
In 2018, the median age for physicians and surgeons was 46.4, according to the Bureau of Labor Statistics. By 2032, the Association of American Medical Colleges projects the U.S. could see a shortage of up to 55,200 primary care and 65,800 specialty care physicians.
“For about every two jobs that are open, only one gets filled – and I’m talking all health care jobs, not just temporary jobs,” Salka says. “Whether you’re in a rural or urban area, we’ve got this collision of demand for health care services rising significantly, just at a time when the shortages are becoming increasingly severe.”
Rural communities can face greater challenges recruiting physicians who do enter the workforce, with a lack of jobs for a doctor’s spouse or the appeal of a big city winning out over small-town life. And not being able to replace a provider can mean a severe financial hit.
“As we get into it, and we tear apart the books of these hospitals, and we look at their finances, we look at their service lines, we look at where their risk is – much of it comes down to they just lost one or two key providers,” says Travis Singleton, an executive vice president with physician recruitment agency Merritt Hawkins, which is part of AMN Healthcare.
Overall, Singleton says, roughly half of rural hospitals are facing some kind of financial risk, and about 20% are on “the brink of closing.”
Yet along with Haleyville, Alabama, there are bright spots. In Kalispell, Montana, hospital officials say they have less trouble with recruitment thanks to the appeal of skiing, Glacier National Park and two nearby lakes attracting people to the area.
On July 1, nonprofit Kalispell Regional Healthcare opened the first floor of Montana Children’s – a $60 million pediatric facility funded by debt, operating reserves and philanthropy that offers high-level specialists and residential options for families whose kids are receiving care.
Previously, the closest, similar type of children’s medical facility was in Spokane, Washington – a more than four-hour drive featuring mountain passes that could be treacherous in winter, says Jason Spring, chief strategic officer for Kalispell Regional Healthcare.
“Traditionally in Montana, we had specialists that came from Seattle or Colorado or someplace and would come once a month, and have a clinic for a day or two, and then go back to their respective institutions,” Spring says.
Now, “if you live in Montana and you have a child that has a chronic disease, then you don’t necessarily have to move to Denver anymore to be able to get access to care,” Spring says.
In neighboring North Dakota, some residents have gotten better health care access thanks to an industry-driven population boom.
McKenzie County‘s population more than doubled between 2010 and 2018, according to U.S. Census Bureau estimates, thanks primarily to oil and gas operations. The county’s population surged from 6,360 residents to an estimated 13,632 over that time, and local leaders recognized an urgent need to expand their health care system.
Thanks to federal and state loans, oil industry and private-citizen donations, and local funding– including a sales tax increase – the new McKenzie County Hospital in Watford City marked its one-year anniversary in June.
Residents used to have to drive at least 50 minutes to get certain surgeries or preventative health care services now offered at the new facility, says Patsy Levang, board chair of McKenzie County Healthcare Systems. Plans to open an obstetrics unit and recruit a pediatrician also are in the works.
“Not everybody wants to live in a city, and not everybody should, and there are great places in America that should not have to suffer with second-class health care,” says Levang, who grew up in McKenzie County. “No matter what the industry is, it’s in our backyard. We need to be making those partnerships, we need to be talking to those people, we need to be arm-and-arm with city, county, state and our local industry partners to have the very best we can offer to our citizenry.”
Each rural community is unique, Morgan of the National Rural Health Association says. But among those where hospitals have survived, “the secret sauce is always just really strong, collaborative leadership.”
“In rural (health care), you don’t have in many cases that intense competition that you’ll have in an urban setting where you have multiple actors playing in the same service area,” Morgan says. “In a rural setting, you have to have collaboration to keep community access to health care open.”