Promoting Access To Hospital Care In Rural Areas: Current Approaches And Ongoing Challenges

Financial distress among rural hospitals is a significant concern for policy makers. Poor financial performance increases the likelihood of hospital closure and merger, and it can limit hospitals’ ability to invest in quality improvements. In response to these challenges, policy makers are actively seeking ways to ensure access to affordable, high-quality care for rural communities. We discuss two broad policy approaches for supporting rural hospitals. First, although current policy supports rural hospitals financially through a variety of public programs, this support is not well targeted. There are opportunities to target public funds more effectively to hospitals that are critical sources of care in their communities through Medicare or other public programs. Second, in cases where markets cannot support the delivery of high-quality care at multiple hospitals, regulation is crucial to ensure public benefit and limit the potential deleterious consequences of reduced competition, such as increased prices, reduced quality, and limited access to care.