New Study Reports on the Vulnerability of Rural Kansas Hospitals 1 in 3 rural hospitals in Kansas are classified as vulnerable and “at risk” of closure.

(February 5, 2016) – iVantage® Health Analytics, a leading national provider of health care analytics and

decision support tools, released its 2016 Hospital Strength INDEX Study this week, which assessed and

benchmarked rural and Critical Access Hospital performance. Of the 107 rural hospitals in Kansas, 31 are

classified as vulnerable and “at risk” of closure, according to the study. Last year, Kansas had 17 at-risk

hospitals, according to the study. Nationally, 67 hospitals have closed since 2010. In Kansas, Mercy Hospital

in Independence, closed in October 2015.

The 2016 analysis suggests the situation is

worsening for many rural communities. The

loss of a hospital can have a lasting impact on

its community. In Kansas, the study estimates if

the state’s 31 vulnerable hospitals were to

close, the state could potentially face:

 2,952 health care jobs lost

 235,654 patient encounters

 4,073 community jobs lost

 $8.3 billion loss to the GDP (10 years)

A combination of factors contribute to the hospitals’ at-risk status. Significant downward pressure on rural

hospital margins is fueled by:

 Rural hospitals tend to serve disproportionately poorer, sicker and older patients

 Failure to expand Medicaid: the number of uninsured patients is typically higher in states that have not

expanded Medicaid, which means rural hospitals receive less money in reimbursements from Medicaid

and provide more uncompensated care

 Rural hospitals have endured decreases in Medicare reimbursement that began in 2013, including

sequestration, charity care/bad-debt reimbursement cuts and disproportionate share payment cuts

Keeping rural hospitals healthy is an urgent matter. Right now, Kansas hospitals are working to develop more

sustainable health care systems and encourage the development of new models of health care delivery. With

grant funding from the United Methodist Health Ministry Fund, Hutchinson, KS, five Kansas hospitals are

testing the viability and effectiveness of two ambulatory care alternatives to full hospital services. These

models were developed by hospital executives who began meeting in 2012 in response to the ever changing

health care needs of rural communities in Kansas. Kansas hospitals welcome the opportunity to work with the

Administration and its new rural health care working group; however, we need swift action as the deficit in

revenue support for rural health care systems is a fundamental problem.

One way to keep health care accessible in our rural and urban communities is to insure more patients. The

Bridge to a Healthy Kansas, a new, budget-neutral health care solution, will provide more low-income,

hardworking Kansans with health care coverage, which in turn helps maintain access to local health care

services in rural and urban Kansas communities. It also will reduce the occurrence of uncompensated care for

the uninsured and the associated costs that are passed along to hospitals and other health care providers.

Kansans rely on rural hospitals. More than 36 percent of Kansans – or one in three – live in rural areas. These

hospitals provide essential health care services to a growing population of rural Medicare beneficiaries. Rural

communities depend on hospitals to be there 24 hours a day, seven days a week, 365 days a year.

Rural hospitals are economic engines in small communities and are critical to sustaining the overall resources

of the State. Hospitals support job growth; for each individual employed by a Kansas community hospital,

another 0.83 jobs were supported in other businesses and industries in Kansas.

The Kansas Hospital Association is a voluntary, non-profit organization existing to be the leading advocate and

resource for members. KHA membership includes 212 member facilities, of which 126 are full-service,

community hospitals. Founded in 1910, KHA’s vision is: “Optimal Health for Kansas.”