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Rural hospitals ‘on the brink of disaster’

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(The Center Square) — Making rural health care better in Pennsylvania may require some significant changes in state law.

Some experts point toward funding problems while others note legal barriers to improvements.

“Rural health care in Pennsylvania faces some very unique challenges specific to its population and location,” Sen. Dan Laughlin, R-Erie, said during a Wednesday meeting of the Senate Majority Policy Committee.

From vast distances to an aging population and a lack of providers, problems in the rural parts of the commonwealth will not disappear with time.

“I am here today to tell you that rural hospitals are on the brink of disaster without increased support from our state and federal governments,” said Steven Fontaine, CEO of Penn Highlands Healthcare.

Fontaine warned that low payments from insurers and Medicare and Medicaid reimbursements falling short of the cost of services will become a bigger issue in rural Pennsylvania. On top of that, he warned that labor shortages will hit in less than a decade.

“Hospitals in Pennsylvania’s rural communities report average vacancy rates of 26% for registered nurses and 28% for nursing support staff,” he said. “The Pennsylvania shortage of nurses is the worst in the nation with a current deficit of 20,000 positions.”

Fontaine argued that state and federal reimbursement rates need to go up to put rural hospitals on stronger financial footing, and that legislators should reconsider legal barriers like staffing requirements and limitations on telehealth.

Finances are tight for all hospitals, but rural ones struggle more.

“Hospital profit margins in both rural and urban counties plummeted between FY 2019 and FY 2022,” said Kyle Kopko, executive director of the Center for Rural Pennsylvania. “While, on average, rural hospitals still maintain a positive profit margin according to the most recent data, they are dangerously close to an average budgetary net loss. Due in part to this trend, more than 20 percent of Pennsylvania’s hospitals are considered financially vulnerable.”

Without fixing health care issues, testifiers warned that rural areas may struggle to grow.

“We cannot recruit workers to communities without vibrant health systems,” said Nicole Stallings, president and CEO of The Hospital + Healthsystem Association of Pennsylvania.

Multiple testifiers argued for the expansion of telehealth and removing legal barriers to expansion, though they noted that it cannot always replace in-person nurses and doctors. Another legislative fix was to expand the scope of practice for nurse practitioners.

“There’s broad consensus about the ability of nurse practitioners to provide great quality of care,” said David Mitchell, professor of political economy at Ball State University. “Increased access to care means that problems are taken care of earlier and cheaper.

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