In rural America, some hospitals find ways to thrive

Health care can be an economic lifeline for small towns

Writing in the New York Times, Dionne Searcey last week profiled a small hospital in Beatrice, Nebraska—a town with 12,000 inhabitants—and its successful efforts to expand despite the financial struggles of many rural communities.

Beatrice Community Hospital and Health Center (BCHHC) is the second-largest employer in Beatrice. The 25-bed hospital employs 512 people, has a $28 million payroll, and brought in $100 million in revenue last year. Even as businesses have left Beatrice in recent years, BCHHC has grown, opening a new building and seeing a two-fold increase in patient visits since 2009.

But the story is very different at many other rural U.S. hospitals; according to the North Carolina Rural Health Research Program, nearly 50 rural hospitals have closed in the last four years. "It's feast or famine," says Brock Slabach, senior vice president for member services at the National Rural Health Association.  

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A success story in Nebraska

BCHHC CEO Thomas Sommers says the hospital has had to be strategic and establish a niche for itself. For instance, the average age in Beatrice is six years higher than the average age in Nebraska, so the hospital has made significant investments in treating and serving the area's aging residents. And as the town's population begins to retire, several new nursing homes have opened, with BCHHC serving as their medical hub.

Other successful rural hospitals have followed a similar model. For example, Margaret Mary Community Hospital in 6,500-resident Batesville, Indiana, has developed a rheumatology program to serve the town's aging population. Tim Putnam, Margaret Mary's CEO, has also partnered with a catch-a-ride service to provide transportation for older residents that do not have access to public transit. "We have to focus on what we do well and partner with others who can provide care that we can't," he says.

In addition, Sommers has emphasized recruiting—and retaining—physicians by offering salaries higher at BCHHC than those available in many urban areas. And money can go further in Beatrice, where a newly remodeled three-bedroom house sells for about $72,000.

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Sommers also worked to address patients' concerns and improve the hospital's image in the community.  Six years ago, BCHHC had the worst patient experience scores of any hospital in Nebraska, and the hospital was losing business to larger facilities in Lincoln, 40 miles away.

Sommers, who started as CEO in 2004, addressed the issue by starting small: He encouraged physicians and staff to appear on a local radio show. He also released detailed financial information about the hospital to the public in order to publicize the economic role the hospital plays in Beatrice. And phone surveys found that some patients were frustrated with BCHHC's lack of female doctors, so Sommers made recruiting female physicians a priority.

Now, BCHHC ranks above the national average in every category tracked on Medicare's Hospital Compare website. Other hospital executives are taking notes. Chad Netterville, CEO of Field Memorial Community Hospital (FMCH) in rural Centreville, Mississippi, visited BCHHC to learn about its expansion strategy. "I was impressed," he says.

Now, FMCH is building a new $21 million facility with the help of a federal grant. The expansion will mean big changes in the care FMCH can provide, but it will also have a big impact on Centreville's 1,600 residents. "A lot of times in the rural communities your health care systems are your economic drivers, and that's true here," Netterville says (Searcey, New York Times, 4/30).

The takeaway: While many rural hospitals have struggled or closed in recent years, some have found a way to survive—or even grow—providing an economic lifeline to small towns across the country.


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