Report Details Threats to America’s Rural Health Safety Net

February 13, 2025

The state of care across rural areas in the U.S. is under intense pressure with reduced reimbursements, dwindling access to care, and deteriorating population health status causing alarming instability, according to a recent report by Chartis, a health care consulting firm.

The report states that 46 percent of rural hospitals in the U.S. are operating in the red, and 432 are vulnerable to closure.

“For the more than 46 million people who live in rural areas, the rapid deterioration of access to care and persistent financial strain raise pointed questions about the safety net’s ability to continue to meet the needs of these communities in the future,” according to the Chartis report.

Here are five things to know:

• Payment cuts:  Policies such as Medicare cuts due to sequestration and reducing bad debt reimbursement would cost rural hospitals more than $650 million this year.
• Medicare Advantage:  Due to operating on razor-thin margins and serving communities where Medicare is typically the largest payor, rural providers are disproportionately affected by lower reimbursement and administrative barriers related to Medicare Advantage.
  • 39 percent of Medicare-eligible individuals in rural communities are enrolled in Medicare Advantage plans.
• Care deserts:  293 rural hospitals stopped offering obstetric services between 2011 and 2023, while 424 ceased chemotherapy services between 2014 and 2023.
  • Pennsylvania has second-highest highest percentage of rural hospitals stopping obstetric services (42% from 2011–2023).
  • HAP’s recent Action Plan for Maternal Health outlines key steps that hospitals and policymakers can take to preserve access to maternal health care in rural communities.
• Social factors:  Social drivers of health indicators show rural communities have lower median household income and higher rates of child poverty when compared to their urban peers. Rural Americans also carry a larger share of the chronic disease burden with higher rates of adult obesity and have higher rates of premature death than their urban counterparts.
• Quotable:  “The loss of a rural hospital can trigger a downward spiral of economic hardship and community health status,” the report notes.

The Chartis report is available online.

HAP is focused on advocacy to ensure that rural hospitals can sustainably serve their communities. Learn more about HAP’s agenda to ensure all Pennsylvanians can access high-quality care.