- Lakeland Community Hospital in Haleyville, Alabama, said it will cease operations by the end of the year. The 59-bed facility is the sole hospital serving rural Winston County.
- Hospital officials blamed the move on shrinking reimbursements, saying Lakeland faces payment cuts of nearly $2 million.
- “Our team explored every viable option to avoid closing the hospital,” CEO Debbie Pace said in a statement. “Unfortunately, as with many other rural healthcare facilities in the Southeast, we are unable to continue operations due to such drastic reductions in reimbursement.”
Rural hospitals across the U.S. are struggling to survive. Since 2010, 80 rural hospitals have closed and 673 are at risk of closing — 210 of which are at “extreme risk,” according to iVantage Health Analytics.
Under the Affordable Care Act, Disproportionate Share Hospital payments to rural facilities were sharply reduced. Further cuts in CMS reimbursement for low-volume adjustments for rural hospitals and reductions in commercial payer rates have hurt hospitals’ bottom lines, forcing many to operate at a loss.
Rural hospitals are also facing demographic changes and declining inpatient volumes as more patient care shifts to outpatient settings. Meanwhile, President Donald Trump’s fiscal year 2018 budget proposal calls for $627 billion to be cut from Medicaid over a decade — a potential death knell for rural hospitals serving largely low-income populations.
While the outlook is not good, some rural hospitals are beating the odds by focusing on outpatient offerings and employing creative solutions like eHospitalists to help staff emergency departments during nighttime hours.
Others are partnering with other rural facilities to gain economies of scale and bargaining power. “We can’t afford a data analyst, but five hospitals together can afford and share a data analyst,” Leslie March, CEO of Lexington Regional Medical Center in south central Nebraska, told Healthcare Dive last month.