COVID-19's toll on rural hospitals: 3 execs weigh in on 2021's financial challenges

The COVID-19 pandemic has burdened hospitals across the U.S., but has especially hurt rural hospitals as they deal with workforce shortages, wage increases and patient volume, several rural healthcare executives say.

At the same time, the pandemic has also shown what changes need to be made in rural healthcare, they say. Becker's spoke with three rural healthcare leaders on the financial challenges they faced this year.

Editor's note: Responses have been lightly edited for style and clarity.

What financial challenges did this year bring that's unique to rural hospitals?

Chris Engelhardt, director of finance at MyMichigan Medical Centers in Gladwin and West Branch: Endurance and adaptation are the words that come most to mind for 2021. MyMichigan Health's rural hospitals have had to adapt quickly to changing environments throughout the year. From having to defer or cancel elective procedures impacting revenue, to managing labor shortages, and ensuring competitive salaries during a period of high volatility increasing our costs.

Lisa Carlson, CFO of Chillicothe, Ohio-based Adena Health System: All of healthcare has workforce challenges. However, for rural providers the challenges are heightened by having both the national shortages and resulting increase in wage rates, while also paying an additional premium for staff to live or commute to a rural area.  

Patrick Sharp, CEO of Durango, Colo.-based Mercy Hospital: The Great Resignation — also known as the Big Quit — has created unprecedented financial challenges. We've witnessed many hospital professionals retire or leave the healthcare industry during the pandemic due to fatigue, stress, public opinion and the incredibly difficult work. At the same time, national resources like staffing agencies or traveling nurses have not been as readily available as they may have been in "non pandemic" times. Mercy Hospital and Centura Health responded to these workforce challenges by investing more than $200 million in our caregivers' pay and benefits over the last 12 months. The pay and benefit changes include increased tuition reimbursement, PTO cash-outs, housing stipends, changes to sign-on bonuses and market-based bonuses and adjustments. 

What did COVID bring to light when it comes to rural healthcare?

Mr. Engelhardt: COVID has shined a spotlight on the health gap between urban and rural communities. Lower vaccination rates amongst the population, and multiple comorbidities being more commonplace amongst the population place stress on medical centers as volumes approach capacity at times. Delivery of healthcare close to home is essential in combating this trend. Community education and outreach, expanding virtual care, having access to specialists close to home, and in-home care delivery models are necessary to ensure that we are not only maintaining health, but creating healthy communities, together.  

Ms. Carlson: We will need to have more flexibility in non-direct patient care areas in schedule and work-from-home options. That additional geographic distribution of workforce will create new culture and leadership development challenges. Also brought to light was the significance in both urgent care and telemedicine in the core delivery model going forward.

Mr. Sharp: COVID-19 has proven the benefit of being a part of a larger, well-managed healthcare system. The resources, whether staff, ventilators, beds or other key supplies, are available quickly and allow our teams to ensure the community receives the best possible care. Our connected ecosystem of 17 hospitals can flex to meet the daily challenges of COVID-19, while at the same time caring for the wave of patients with higher acuity. It’s a commitment from Centura that I see play out inside Mercy every day and we are grateful for that support.



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