THOMASVILLE, ALA.—Thomasville Regional Medical Middle was imagined to be a gamechanger. Located within the U.S. Congressional district with the worst well being outcomes within the nation, the hospital opened in 2020 with state-of-the artwork tools, together with a 3D mammogram and an MRI scanner. However it closed lower than 5 years later in Sept. 2024.
The hospital now stands empty: its pristine hallways darkish, its costly machines gathering mud. “It’s nearly just like the apocalypse occurred,” says Sheldon Day, the mayor of Thomasville, who had labored for nearly a decade to get a hospital to open there.
This apocalypse is occurring all through rural communities throughout the nation. More than 100 rural hospitals have closed prior to now decade, in line with the Middle for Healthcare High quality and Fee Reform (CHQPR), a nationwide coverage heart that works to enhance well being care fee techniques and whose knowledge have been cited by the Bipartisan Policy Center. About one-third of all rural hospitals within the nation are vulnerable to closing due to monetary issues. In Alabama, 23 rural hospitals—about half of all of them within the state—are at instant danger of closing, in line with CHQPR.
Much more rural hospitals is likely to be in hassle if Congress passes the large piece of laws earlier than it, known as the One Huge Lovely Invoice Act, which incorporates vital cuts that might slash Medicaid spending in rural areas by $119 billion over 10 years, according to KFF. Thom Tillis, the U.S. Senator from North Carolina who stated he couldn’t assist the invoice in its present type, stated in a statement on June 28 that Congress wanted to realize the tax cuts and spending within the invoice “with out hurting our rural communities and hospitals.”
Why rural hospitals are closing
Folks typically blame rural hospital closures on poor reimbursement charges from Medicare and Medicaid. There’s a cause for that assumption: Nearly each hospital loses cash on Medicaid and Medicare, since reimbursement charges are low nationwide. However hospitals just like the one in Thomasville are struggling not as a result of they serve a big share of poor sufferers or aged individuals on these plans.
“If you have a look at the information, what you see is that Medicare and Medicaid should not the issue,” says Harold Miller, president and CEO of CHQPR. “The issue is personal insurers.”
Rural hospitals rely on personal insurers for almost all of their affected person prices, Miller says. In Alabama, as an illustration, CHQPR’s data exhibits that the majority rural hospitals rely on personal insurers for wherever between 65-80% of affected person prices; in Thomasville, 18.4% of sufferers had been utilizing Medicare to pay for his or her protection, 16.2% had been utilizing Medicaid, and 65.4% had been utilizing personal insurance coverage.
However many rural hospitals are dropping cash on what personal insurers can pay for affected person care. The one in Thomasville, as an illustration, was getting paid by personal insurers roughly half of what it was costing to ship providers, in line with federal data compiled by CHQPR.
It is a very totally different scenario than what is occurring between personal insurers and concrete hospitals, he says. City hospitals and enormous rural hospitals are in a position to make up for the losses from Medicare and Medicaid sufferers with what they’ll cost personal insurers. Small rural hospitals can’t try this.
Rural hospitals really want larger compensation than city hospitals, Miller says, as a result of they’ve the identical mounted prices like 24-hour staffing, however have a decrease quantity of sufferers to cowl these prices.
Why small rural hospitals get much less from personal insurers
One cause why small hospitals get much less cash: Insurers demand reductions. Bigger hospitals have extra leverage to barter with personal insurers over these reductions as a result of they’ve larger affected person volumes. Smaller hospitals have much less wiggle room to barter.
One other drawback in Alabama specifically is that only one well being insurer, Blue Cross and Blue Protect of Alabama, has an estimated 94% of the large-group personal insurance coverage market, which most individuals with personal medical insurance fall underneath. Hospitals can’t negotiate as properly as a result of they’ve to just accept Blue Cross and Blue Protect of Alabama sufferers, and dropping these sufferers can be financially ruinous. That’s how one small rural hospital in Alabama, Medical Middle Barbour in Eufaula, will get paid simply $65 for an X-ray by Blue Cross and Blue Protect of Alabama, in comparison with $97.03 by Aetna, in line with Miller’s knowledge.
“Alabama Blue Cross might single-handedly save all the agricultural hospitals in Alabama,” Miller says. “It simply has to pay adequately.”
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In an announcement, Blue Cross Blue Protect of Alabama stated that it really works annually with the Alabama Hospital Affiliation to judge the care rural hospitals present and to compensate these services. It disputed CHQPR’s assertion that non-public insurers are answerable for 65-80% of affected person prices in rural hospitals in Alabama, saying that Blue Cross and Blue Protect of Alabama sufferers comprise solely a small share of affected person quantity at rural hospitals in Alabama (whereas declining to supply particular numbers). “Thus, the most important monetary affect to rural hospitals is the federal government payer sector,” the corporate stated. A Blue Cross and Blue Protect of Alabama spokesperson stated the corporate’s market share statewide is “totally different for various market segments”—however referred TIME to federal data displaying that it, and never another insurer, covers the overwhelming majority of Alabamans.
The corporate launched a medical scholarship program in 2016 to advertise entry to high quality well being care in rural areas of Alabama, a spokesperson stated, and 38 medical college students have now graduated and are training in rural elements of the state.
The challenges going through rural hospitals nationwide have gotten worse within the final 12 months or two, Miller says, as a result of prices have gone up after the pandemic as labor turned scarce and plenty of medical doctors and nurses stop the sphere after getting burned out. What’s extra, the federal authorities provided many pandemic-era grants to hospitals so they might keep open, however these have run out. One cause the Thomasville hospital failed is that it couldn’t get any of these federal grants as a result of it had not been open lengthy sufficient.
What occurs when a rural hospital closes
On a current weekday afternoon, Dr. Daveta Dozier, a household doctor who has practiced in Thomasville for 40 years, walked me by means of the closed Thomasville hospital. The hallways and affected person rooms ought to have been buzzing with beeps and medical conversations, however the constructing was eerily quiet, prefer it had flatlined. She identified the MRI machine the place she’d ship sufferers so they might keep away from the 90-minute roundtrip drive to Cell, and the laboratory the place her sufferers might get blood work achieved.
Now, she says, when she tells her sufferers to get difficult lab work or imaging, they’ll’t do it regionally. So many don’t do it in any respect.
“Half the time they don’t go,” she says. “Both they’ll’t discover household to take them or they’re working and so they can’t get off.”
This implies by the point they find yourself looking for well being care, they’re sicker than they’d have been had the hospital stayed open. That corresponds to what medical doctors have been seeing throughout the nation after remoted rural hospitals shut. One study found that following a closure, the hospitalization charges and common size of hospital stays elevated for locals. When hospitals had been extra remoted, rural sufferers had been extra more likely to be readmitted to a hospital after an preliminary keep.
Dozier is in personal apply together with her husband, who can be the medical director for the native nursing residence. Prior to now few weeks, she says, the nursing residence had eight separate sufferers with medical wants like urinary tract infections and pneumonia that required them to be transported to hospitals in Cell. Had the hospital in Thomasville been open, they might have been handled there.
Now, their households should make the trek to go to them. “The very first thing you hear them say is, ‘I don’t need to go to Cell,’” she says.
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Barbara Smith, 78, is aware of what it’s wish to drive continuously to Cell for care. Her husband, who just lately handed away, had bladder cancer, and the closest remedy heart was practically 2 hours from their residence. “It certain was a whole lot of driving,” she says.
With closures of rural hospitals just like the one in Thomasville, some hospitals’ emergency rooms in city areas of Alabama develop into full and ship sufferers to different hospitals—and generally different states—to be seen, Dozier says. Emergency department crowding is a rising drawback throughout the nation.
There may be one other hospital 20 minutes south of Thomasville known as Grove Hill Memorial Hospital. However additionally it is financially struggling and just lately made the choice to transform to what’s known as a rural emergency hospital, which suggests it would only have an emergency room and never inpatient care. With that conversion, it receives federal funding to assist it keep open—however sufferers received’t be capable of get a lot there aside from emergency providers.
I requested Stacey Gilchrist, chief working officer of the Thomasville hospital in receivership, why Thomasville wanted a hospital when sufferers might go to Grove Hill for emergency providers. She gave the instance of a 40-year previous girl who rushed to the Thomasville hospital when she was having chest pains; medical doctors there stabilized her, however different physicians in Cell who later handled her stated she would probably have died if she wanted to drive additional. “When you’re having a coronary heart assault, do you need to trip 20 minutes down the highway, or 5 minutes?” she says.
Lots of Thomasville’s sufferers come from much more rural areas. Using 20 extra minutes may very well be the distinction between life and loss of life for them, she says.
What’s extra, she says, Thomasville’s hospital was way more than an emergency room. It had 29 rooms the place sufferers might keep in a single day and be handled for critical circumstances, a lab, and the latest tools that isn’t in another rural hospital within the area.
Shrinking entry, much less well being care
Thomasville is positioned in Alabama’s seventh Congressional District, which stretches between Birmingham and the state’s border with Mississippi. A Harvard study from 2022 discovered that the district ranked final when it comes to life expectations nationwide.
Officers like Mayor Day say that is partly as a result of it’s so exhausting to entry well being care. “Folks simply merely don’t go to the physician till they get actual sick,” he says.
He had hoped that opening the Thomasville hospital would assist. He and native officers had labored for years to place collectively an incentive bundle to encourage somebody to reopen a hospital in Thomasville, after the final one closed within the wake of the Nice Recession.
“We actually wished to vary the dynamic of well being care right here,” he says.
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Thomasville shouldn’t be the one neighborhood optimistic sufficient to attempt to open a rural hospital at a time when many had been closing. Between 2017 and 2023, 11 acute care basic hospitals had been opened in rural areas, in line with data from KFF. However 61 hospitals closed throughout the identical time interval.
Town gave the traders who constructed the Thomasville hospital a reduction on the land and accepted a one-cent gross sales tax that might go to the hospital to assist it keep open. The traders purchased new tools, figuring out that cash might be made in diagnostics if they might get individuals to return to Thomasville slightly than going elsewhere for exams like MRIs and CT scans.
Specialists from Cell began arising a number of days per week to see sufferers, sparing residents the lengthy drive. A bodily remedy apply opened within the constructing, and Day had plans to broaden the campus and open a cancer remedy heart.
However then the pandemic hit, and prices spiraled uncontrolled as a result of the hospital might do fewer money-making procedures and needed to spend extra on private protecting tools and different pandemic-related providers. Compensation by personal payers remained stubbornly low at rural hospitals throughout the nation through the pandemic, according to CHQPR.
Lastly, the Thomasville hospital’s homeowners ran out of cash, filed for chapter, and shut it down.
The hospital closure had an affect on the native financial system. Companies assume twice about opening in a rural location with out well being care, Day says. And current companies that may’t transfer, like farms who want plenty of rural land, should take care of sicker employees.
How rural hospitals can succeed
A brand new proprietor has purchased the Thomasville hospital’s property out of chapter, and Day says they plan to reopen the Thomasville hospital quickly. He’s hoping they’ll do issues otherwise this time in order that they’ll determine a strategy to maintain the agricultural hospital from dropping cash.
One concept is to affix a community with a giant, city hospital to allow them to extra successfully negotiate reimbursement from insurers. One other is to create a community of rural hospitals that may band collectively to barter.
And Day is hoping that Congress will act. One invoice, the Rural Hospital Stabilization Act of 2025, was launched in April and would give grants to rural hospitals to assist them keep out of the purple.
U.S. Well being and Human Companies Secretary Robert F. Kennedy Jr. has talked about being extra proactive to forestall continual illnesses earlier than they occur, and Day thinks the Thomasville hospital might play a job in that by making it simpler for sufferers to get preventative care near residence.
Day is already speaking about utilizing AI within the hospital and making a medical campus to draw individuals from throughout the area, including assisted residing providers and dementia care. Particulars are skinny, and all of that takes cash. However as a mayor who has seen a hospital shut twice in his city, he hopes that, working with elected officers, he can determine a strategy to change the hospital’s destiny this time.
“Each rural neighborhood within the nation is going through this battle,” he says. “However closing hospitals shouldn’t be an choice. When you don’t have fundamental well being care, you’re going to kill your neighborhood.”
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