Geographic Variation in the Profitability of Urban and Rural Hospitals
The popular business quote “No margin, no mission” succinctly states the importance of profitability. The notion that if a hospital doesn’t make enough money to keep its doors open, its higher purpose is moot may be a simplistic view, but historic and recent evidence suggest that unprofitability can reduce hospital services and quality, or worse, lead to closure.
Between January 2010 and January 2016, 66 rural hospitals have closed, a majority of them in the South. Understanding where some hospitals are succeeding, compared to those that are not, is important as policy makers try to craft sustainable models of health care for rural areas.
To help policy makers, researchers, and communities understand which hospitals are likely to be less profitable, the North Carolina Rural Health Research Program’s brief, Geographic Variation in the Profitability of Urban and Rural Hospitals, describes the current geographic variability of hospital profitability by comparing the 2014 profitability of CAHs, other rural hospitals (Medicare Dependent Hospitals, Sole Community Hospitals, and rural PPS hospitals, denoted as “ORHs”) and urban hospitals by census region, census division, and state.