Three essays on rural health economics

Abstract

Rural hospitals in the U.S. have been struggling financially for the past few decades. The increased number of rural hospitals in financial distress has led to an acceleration in rural hospital closures. Rural hospital closures have become a source of concern for policymakers and researchers since areas with the highest number of closures tend to be some of the country’s most vulnerable ones. Decreased access to care caused by rural hospital closures only worsens health outcomes in already vulnerable sectors of the population. Considering how relevant the rural hospital closure problem has become, there has been a newfound interest in finding solutions to improve rural hospital finances and ultimately avoid closure. The three chapters below explore how distinct hospital-specific and community characteristics influence rural hospital finances and closure. The first chapter examines the relationship between Electronic Health Record (EHR) functionality and hospitals’ operating costs, finding that increased EHR functionality is associated with significant decreases in costs, but only for urban hospitals. The second chapter explores whether community sociodemographic factors are associated with the survival or closure of rural hospitals, finding that rural hospitals at risk of financial distress are more likely to experience closure if their communities have higher unemployment rates and higher percentages of their population uninsured. Finally, the third chapter studies the relationship between telehealth / remote patient monitoring implementation before the COVID-19 emergency declaration and revenue changes during the COVID-19 pandemic (from 2019 to 2020), finding that telehealth implementation prior to the COVID-19 pandemic is significantly associated with increases in revenue during the COVID-19 pandemic. Our analyses shed light on the rural hospital closure issue by finding factors associated with decreases in hospital operating costs, decreases in the likelihood of hospital closure, and increases in hospital revenues.