Rural healthcare in America is in serious trouble. Hospitals are shutting down, doctors are in short supply, and patients are left scrambling for care.
If you work with clients in rural areas, this problem is reshaping your world and needs a solution today. This article discusses what this world is now and how likely it will change in the future.
Why Rural Healthcare Is in Crisis
- Hospital Closures Are Piling Up
More than 140 rural hospitals have closed since 2005, with more closing each month. When a hospital shuts down, patients must travel farther for care, sometimes for hours. This inconvenience is life-threatening in emergencies.
- The Doctor and Nurse Shortage
Many hospitals employ doctors who treat patients in offices inside or outside the hospital. When hospitals close, these doctors’ offices close, too.
This activity exacerbates a serious problem for rural communities. These areas are declining in population, and the remaining residents are aging and have lower incomes. These circumstances make attracting medical professionals to these isolated areas with fewer resources more challenging.
With about 20% of the population on Medicaid, Medicaid payments is a larger proportion of rural hospitals’ and health systems’ revenue than their suburban and urban counterparts. For every dollar Medicare and commercial insurance pays to reimburse care to rural hospitals and health care systems, the same payment from Medicaid is about 70% on the same type of service. This 30% decrease in revenue from Medicaid payments is a significant hole for their budgets, making it impossible to pay competitive salaries for physicians and nurses.
The result? A massive shortage of doctors and nurses in rural areas results in overcrowded clinics, long waiting times, and limited specialist care.
- Rising Costs, Shrinking Budgets
The revenue pressures we just mentioned, as well as the smaller, older population with higher rates of uninsured patients, produce budgets with little room to add resources. Rural hospitals and healthcare systems struggle to stay afloat and provide essential services for the population.
Advanced diagnostic equipment, intensive care units (ICUs), and other lab services outside basic testing are rare in rural areas because there isn’t enough money to pay for these care aspects.
- Specialty Care? Good Luck.
Do you need a cardiologist, oncologist, OB-GYN, or rehab services in a rural area? You’ll probably have a long drive ahead since specialists are rare in rural areas for all the reasons we’ve discussed above. That means more travel, higher costs, and delayed treatment for severe conditions for rural patients.
- Telemedicine Isn’t a Perfect Fix
Telemedicine is as good as your internet provider. Many rural areas still suffer unreliable broadband, making virtual care difficult or impossible. Many times, health care providers need to put hands on us and touch us to clarify what’s happening in our bodies for more serious illnesses. This type of hands-on interaction can’t happen in telemedicine.
Solutions to the Rural Healthcare Crisis
The solutions to this crisis are below, but not all of these solutions are easy to realize:
- Expanding Telemedicine & Broadband Access
Telehealth provides essential care in remote areas with provider shortages, but it can only happen if broadband infrastructure significantly improves. Improving rural internet access is critical to making virtual healthcare a reliable option.
- Incentivizing Healthcare Professionals to Work in Rural Areas
Loan forgiveness programs, higher salaries, and better work-life balance incentives will attract more doctors and nurses to rural hospitals and clinics. Developing and executing these programs requires government-business partnerships to facilitate this at the local, state, and federal levels.
- Strengthening Rural Hospital Funding
Increasing Medicaid reimbursement rates and providing federal or state grants will help struggling rural hospitals stay afloat. Exploring ACA options in rural areas to cover more people would expand coverage options and revenue sources for rural hospitals and health care systems.
- Promoting Alternative Care Models
Concierge medicine, direct primary care, and mobile health clinics can help where traditional hospitals and clinics are lacking. These solutions are another area for government-business partnerships at all levels to facilitate their implementation and spread risk and costs.
- Improving Transportation Options
Access to emergency care is a significant concern, so investing in better transportation networks and medical transport services is necessary for timely access to the care patients need. Again, a government-business partnership will facilitate this for the above reasons.
Solutions are available, but most require government-business partnerships to execute, so the likelihood of these solutions happening anytime soon is low.
What This Means for Insurance Agents
If you sell health insurance, here’s how you can help rural clients navigate this crisis:
- Find Plans with Strong Outpatient & Telehealth Benefits
With fewer hospitals, outpatient care and telehealth are more critical than ever, so find plans covering virtual visits and urgent care centers.
- Help Clients Plan for Higher Costs
When local hospitals close, the remaining ones often charge more. Rising premiums and out-of-pocket costs mean you must be ready to guide your clients through these changes and prepare for higher fees.
- Push for Supplemental Coverage
Prepare for these higher costs with a suitable hospital indemnity or critical illness plan, which can be lifesavers in limited healthcare access situations. Coverage solutions that provide clients with extra financial protection for travel and out-of-network expenses are also great possibilities.
- Stay Informed on Coverage Option Changes
Rural hospital closures most affect seniors and low-income populations. If you sell Medicare, Medicaid, or ACA plans, monitor coverage option changes and what’s new for your clients.
- Consider Alternative Care Models
Rural residents need to access concierge medicine, direct primary care, and membership-based health services to bridge the care gap. Agents need to understand how these models work to evaluate whether these models are viable options for providing predictable access to care for rural clients.
The rural healthcare crisis isn’t going away anytime soon, and insurance agents are critical in helping clients adapt and live in this world. Be present for clients and position yourself as the trusted advisor in a rapidly changing rural healthcare landscape.
Agility will inform you of the latest news on the rural healthcare crisis and its impact on insurance agents. Our national insurance product portfolio provides agents access to the coverage options rural clients will need. Agents can contract with these options now on our contracting website page.
Contact Agility now at (866) 590-9771 or email [email protected] to find the products your rural clients will need and get instant answers to their questions. Agility can add you to our free, weekly email list for tips and vital information!
