Belhaven, NC lost its only hospital on July 1, 2014. The Pungo District Hospital served two rural eastern Carolina counties, Beaufort and Hyde. After Pungo closed, the nearest emergency room for Hyde County residents was 75 miles away. Four days after that closure, 48-year-old Hyde County resident Portia Gibb suffered a heart attack and died while waiting for a Medevac helicopter to take her to the hospital.[i]

The closing of a rural hospital can quickly become a public health crisis. Unfortunately, it’s becoming a more frequent occurrence. Since 2010 48 rural hospitals have closed, and the closure pace has been quickening, from 3 in 2010 to over 15 in 2014.[ii] Those closed hospitals translate to over 1,500 beds that are no longer available to people who need care in rural areas.

 Rural Hospital Closures Since 2010
Rural Hospital Closures Since 2010 
Source: Mitchell Thorson, George Petras and Karl Gelles, USA TODAY

The failure to expand Medicaid is one significant contributing factor. The Affordable Care Act reduced federal reimbursements to hospitals, on the assumption that states would expand their Medicaid programs. But 23 states have rejected Medicaid expansion—including North Carolina—leaving rural hospitals and the communities they serve to bear the costs without federal help. 

These communities were already struggling to keep up before state lawmakers politicized Medicaid expansion. Take North Carolina as an example: The highest county-level poverty rates in the state are all in rural counties.[iii] 

Nationwide, the typical rural hospital is located in a county with a 17.5 percent poverty rate, and charges for Medicare patients representing 31 percent of all hospital charges. “On average, the per capita income in counties where urban hospitals are located is 20 percent higher than the income in counties with rural hospitals.”[iv] Rural counties in the South are particularly disadvantaged: the average poverty level there is 21.6 percent, and average per capita income is $29,801. 

Location of short-term urban and rural U.S. hospitals 
Source: North Carolina Rural Health Research Program, 2015.

Rural hospitals also tend to serve older populations – 16.8 percent of rural county residents are 65 or older, compared with 12.9 percent of urban counties. Per capita health expenditures are typically higher in older populations, since people are more likely to need medical care as they age.[v]

“In rural America, hospitals are often one of the largest employers in the community. Health care in rural areas can represent up to 20 percent of the community’s employment and income.”[vi]

But a rural hospital closing doesn’t just impact community health – there’s also a serious economic risk. The 283 at-risk rural hospitals in the U.S. represent 36,000 health care jobs, 50,000 rural community jobs, and $10.6 billion in local economic activity.[vii] Rural hospitals also have much lower profit margins – an average of 2.7 percent, compared to urban hospitals’ 5.3 percent. And small rural hospitals have the smallest margins overall. 

Rural communities aren’t just facing a hospital shortage, either – they’re also suffering from a lack of healthcare providers in general. Just over 11 percent of physicians work in rural areas, despite 20 percent of Americans living there. In North Carolina, there are an average of 11-23 primary care physicians per 10,000 residents in cities like Durham and Chapel Hill.[viii] That number drops to around four in rural western and eastern North Carolina.[ix] This means that rural citizens aren’t just facing significant geographic obstacles to get emergency care in a hospital. They’re also less able to obtain routine and preventive care on a regular basis.

One potential solution to growing healthcare scarcity is telehealth. Telehealth describes “the use of medical information exchanged from one site to another via electronic communications to improve a patient’s health status”[x] – essentially, health records and healthcare in general going digital. Incorporating technology into healthcare delivery would be especially helpful for rural hospitals, many of which are remote and hard for their community to reach quickly. But it would also require serious investment, including investment in broadband expansion. An IOM report shows that telemedicine is becoming part of hospitals’ business plans, but that is less likely for less profitable hospitals – precisely the hospitals that would benefit the most.

Expanding Medicaid would certainly help rural hospitals, but it wouldn’t necessarily save them. Some analysts argue that the political standoff on Medicaid is just accelerating an inevitable trend. If fewer rural hospitals nationwide will be the new normal, state and local governments need to start investing in workarounds – like telehealth development – so their rural constituents won’t lose the health care they need.



[i] The News and Observer. (July 28, 2014). “Rural hospital closures strand many in need.” Available at http://abc11.com/health/n-o-rural-hospital-closures-strand-many-in-need-/226079/

[ii] Gugliotta, Guy. (March 17, 2015). Rural Hospitals, One Of The Cornerstones Of Small Town Life, Face Increasing Pressure. Kaiser Health News. Available at  http://kaiserhealthnews.org/news/rural-hospitals-one-of-the-cornerstones-of-small-town-life-face-increasing-pressure/

[iii] Mitchell, Tazra. (January 11, 2014). “North Carolina’s counties remain in poverty’s tight grip.” NC Policy Watch. Available at http://pulse.ncpolicywatch.org/2014/01/11/north-carolinas-counties-remain-in-povertys-tight-grip/

[iv] Freeman, Victoria A; Thompson, Kristie; Howard, H. Ann; Randolph, Randy; Holmes, G. Mark. (February 2015). 21st Century Rural Hospitals: A Chart Book. North Carolina Rural Health Research Program, The University of North Carolina at Chapel Hill. Available at http://www.shepscenter.unc.edu/wp-content/uploads/2015/02/21stCenturyRuralHospitalsChartBook.pdf

[v] National Institute on Aging. (October 2011). Assessing The Costs of Aging and Health Care. National Institutes of Health. Available at http://www.nia.nih.gov/research/publication/global-health-and-aging/assessing-costs-aging-and-health-care

[vi] National Rural Health Association. (2015). “Rural Hospital Closures are

Decimating Rural Health Care Delivery.” Available at http://connect.nrharural.org/home

[vii] See note vi.

[viii] Spero, Julie. (July 31, 2013). “North Carolina’s Rural Health Workforce: Challenges and Strategies.” North Carolina Rural Health Research Program, The University of North Carolina at Chapel Hill.  Available at http://www.nciom.org/wp-content/uploads/2013/04/Spero_7-31-13.pdf

[ix] See note viii.

[x] The Institute of Medicine. (November 20, 2012). “The Role of Telehealth in an Evolving Health Care Environment - Workshop Summary.” Available at http://www.iom.edu/Reports/2012/The-Role-of-Telehealth-in-an-Evolving-Health-Care-Environment.aspx