Why rural hospitals may not survive COVID-19

With fear of COVID-19 keeping many routine visitors away, rural hospitals have too few patients to stay afloat financially, and virtual medicine isn't saving them.

Photograph by Lynn Johnson
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The women's clinic is one of seven clinics closed during the pandemic at Whidbey Health Medical Center in Coupeville, Washington. Critical access hospitals like Whidbey are often the sole hospitals for large parts of rural America, yet these facilities are struggling during the COVID-19 pandemic due to patient and financial shortages.

Photograph by Lynn Johnson

To reach North Sunflower Medical Center from any direction, travelers must first drive through miles of open fields filled with cotton, corn, and soy. Eventually, they’ll land in the center of Ruleville, Mississippi, whose population of 2,800 is smaller than the number of monthly visitors the clinic sees ordinarily. Some patients travel from as far as 45 miles away to receive care here.

But the past couple months have not been ordinary. Since March, when the World Health Organization labeled COVID-19 a pandemic, almost 50 percent of North Sunflower Medical Center’s patients have stopped showing up.

This pattern is playing out across the country at both rural and urban hospitals: Fearful of the pandemic, non-coronavirus patients are staying home, despite suffering conditions ranging from minor rashes to major heart attacks. In response, many hospitals have created ad hoc systems for delivering primary care through telemedicine, buoyed by the mantra: If patients won’t come to the hospital, the hospital will come to the patients.

Virtual health care, in theory, sounds perfectly suited to the needs of rural populations. It kicks down the barrier of traveling great distances for medical needs and works increasingly well for diagnosing and managing the chronic and non-emergency health issues endemic to these parts of the country, such as diabetes, hypertension, asthma, and melanoma.

Yet success at implementing these virtual systems has been a patchwork. Unreliable access to at-home technology, broadband internet service, and cell reception have plagued some places, while ever present financial hurdles abound. Rather than usher in a long-anticipated telemedicine revolution in remote areas, COVID-19 has exposed its limitations, and highlighted what tools and regulations rural hospitals will need to survive the pandemic.

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Pediatric speech therapist Peyton Wischmeier working with a child remotely in a telemedicine appointment at Whidbey Health Medical Center in Washington state. Whidbey has had better luck than most rural hospitals at implementing telemedicine because of existing infrastructure. For a lot of rural hospitals, cell towers are challenged, says Whidbey Health CEO Ronald Telles, but “we don't have that here.”

What is telemedicine?

Telemedicine, as a term, is not very descriptive. It can mean something as simple as an audio-only phone call between a hospital physician and an at-home patient, or it can mean medical workers in separate hospitals sharing data via a Bluetooth-enabled stethoscope.

Some types of virtual care have been successfully folded into the rural health experience for up to a decade now. One example is teleradiology, in which the readings of X-rays, CT scans, and MRIs are outsourced to radiologists who are not only outside the hospital but are sometimes even in other countries. Another popular tool is tele-consultation, when a specialist from another hospital can virtually drop into an in-person visit between a patient and a primary care physician, to offer insight beyond the scope of what the local hospital can provide.

These interactions have worked well in the past because they don’t rely on the patient having access to technology or broadband at home, and because the hospitals could run these side activities while the rest of its normal—and more lucrative—services carried on.

Paying for rural telemedicine has long been a struggle, even though doctors and patients tend to love the convenience and expanded expertise. Many rural patients are on either Medicare or Medicaid, and reimbursements from these government health-care programs, as well as from private insurance companies, haven’t fully covered the costs of virtual care.

Joanie Perkins, chief compliance officer at North Sunflower Medical Center, says her team used telemedicine infrequently due to cost issues even before the pandemic. “We’ve used it to connect to a pharmacist or endocrinologist, but only as part of our grant program, because the reimbursements are just so awful.” She adds that for her patients, who are mostly black women, her team is “always looking for grants for devices, because my people can't afford laptops or anything like that.”

In addition to grants, rural hospitals normally offset some of the costs of telemedicine through revenue brought in by regular services, such as orthopedic surgery, colonoscopies, or breast exams. But those elective or outpatient procedures, which make up 80 percent of the services typically offered by rural hospitals, were the first to see staggering decreases because of COVID-19.

The problem is especially acute at critical access hospitals, federally funded medical centers with fewer than 25 beds that are more than 35 miles away from the next nearest hospital. Such facilities have always operated on razor-thin financial margins, and in the absence of regular patients, it’s become more obvious that shifting large amounts of patient care to telemedicine isn’t a sustainable way to keep their facilities open.

Shaky support

As part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, the federal government has temporarily walked back regulations that previously stymied telemedicine, such as prohibiting physicians from practicing across state lines without a license, or preventing Medicare and Medicaid from reimbursing hospitals for audio-only virtual visits. But these changes are set to expire when the pandemic ends, and in their current form, they are still not enough to make telemedicine financially sustainable.

Perkins says 53 percent of her patients use Medicaid, and about 25 percent of the care they would normally manage in person is now happening through telemedicine. Medicaid states that their CARES Act rates for reimbursing telemedicine are equal to what they offer for in-person visits. Yet Perkins says Medicaid will only reimburse her $37.29 for a 10-minute phone call, while a similar in-person visit would garner more than $100.

“It's not very cost effective, but I’ll take what I can get,” Perkins says with a heavy sigh. “At this point, we're just here for the patient.”

It’s hard to say how much longer some rural hospitals can hold on like this, though. Last year was already the worst in a decade of ongoing rural hospital closures. In that time, 120 locations have shuttered, and earlier this year another 453 were marked as vulnerable to closure before the pandemic even started. Moreover, federal pandemic aid has been disproportionately allocated to urban hospitals already buttressed by large financial reserves, and not to struggling rural medical centers.

“There really is no room for error in these communities,” says Alan Morgan, CEO of the National Rural Health Association. “Rural is not just a small version of urban. [It’s] the study of underserved populations and health professional shortage areas.”

Seeing rural medical centers close can have all kinds of ripple effects, says Ken Hunter, CEO of Kimball Health Services. By mid-April, the medical center in the Nebraska panhandle had gone three weeks without seeing a single overnight patient. At that time, Hunter said he had 60 to 75 days of cash on hand, which he was using to keep his employees on payroll at reduced hours while he waited for a loan from the Protected Paycheck Program to kick in. Hunter stressed that the hospital, in addition to being critical for the community’s wellbeing, is also a main source of employment in the area.

“If you lose your hospital, you’ve pretty much lost your town,” he says.

Staying connected

COVID-19 and telemedicine are also exposing the long-running technological disparities between rural and urban areas.

Hunter says the issue isn’t technological literacy, as many of the seniors in the agricultural community surrounding Kimball Health Services are familiar with FaceTiming their grandchildren. It’s the internet and cellular infrastructure that doesn’t always hold up.

“We have a high-speed, fiber [optic] system out here and, you know, every once in a while the cable gets cut,” Hunter says. (Just minutes before, our own cell phone conversation was cut off by a snow storm, and he had to call back via a landline.)

Data from the Pew Research Center say that at least a quarter of people in rural communities across the U.S. are not covered by cellular and broadband internet service, but those numbers may be underselling the problem, according to Marilyn Serafini, director of the health policy project at the Bipartisan Policy Center. She says that if just one person in one county claims to have broadband, then the entire county gets marked as an area that broadband covers. The CARES Act set aside $100 million in grants to help install broadband in rural areas, but the general consensus is that it’s far from enough.

With inconsistent cell phone service and broadband internet, some rural hospitals may be forced to rely on landlines for telemedicine in the long run. And if reimbursement for audio-only visits is abandoned when the CARES Act expires, then broad swaths of rural America will be forced to go back to traveling great distances for primary care.

A way forward

Rural communities aren’t a monolith, and both the technology infrastructure and health conditions they face can vary widely.

Morgan points out that in the western mountain states, where suicide rates are high, being able to make a voice call with a psychologist that won’t cut out might be the most beneficial telehealth service. In the Southwest, where chronic conditions such as diabetes are a bigger concern, health care workers might need a camera supported by broadband to diagnose an associated skin infection, such as diabetic blisters.

Morgan and Serafini both agree that the huge diversity within rural communities is why it’s exceedingly important for any plans around telehealth to be flexible—something the temporary regulations under the pandemic do, in part, account for. The hope is that they’ll be made permanent, and financially sustainable, before it’s too late.

“The pandemic will end, and when it does, people in rural areas are still going to need to get care from a distance. This is the way of life in rural areas,” says Serafini. “If we don't do something to make some of these regulatory changes permanent, then rural areas are going to go back to the difficulties that they've had, and they're going to continue to miss out on care.”

Editor’s note: This article originally misspelled the last name of Ronald Telles.