For many rural hospitals, financial pressure stems less from a lack of resources than from value lost in the ones they already have. Becker’s asked rural healthcare leaders where patients, capacity, reimbursement and strategic assets are losing value, and many pointed to the gaps between them: patients who leave town for care that could be delivered locally, beds that exist on paper but can’t be staffed, and payment that doesn’t cover the fixed cost of keeping essential services open.
Reimbursement drew the sharpest frustration, with leaders citing Medicare cuts, commercial payer denials and contracts that leave small hospitals with little leverage. But most saw the bigger opportunity inside their own walls. Rather than chase more volume or add new services, they want to connect what they already have — physicians, facilities, technology and regional partners — so more patients can get the right care close to home.
The leaders featured below are speaking at Becker’s Rural Healthcare Leadership Summit, April 21-22, 2027, at the Hyatt Regency Chicago.
As part of an ongoing series, Becker’s is connecting with healthcare leaders who will speak at the event to get their perspectives on key issues in the industry.
If you would like to join the event as a speaker, please contact Scott King at sking@beckershealthcare.com.
Editor’s note: Responses have been lightly edited for clarity and length.
Question: Where are patients, capacity, reimbursement and strategic assets currently losing value?
Amy E. Lee. President and COO of Nantucket Cottage Hospital (Nantucket, Mass.): Nantucket Cottage Hospital (NCH) loses value primarily through the mismatch between its responsibility to provide comprehensive, year-round healthcare and the financial, workforce, and operational realities of serving a geographically isolated, highly seasonal community.
Patients and Access: Value is lost when patients must leave the island for specialty consultations, diagnostics, procedures, rehabilitation, or chronic disease management that could potentially be provided locally. These gaps create significant financial and logistical burdens for patients while directing revenue and opportunities for continuity of care off-island.
Capacity and Workforce: NCH must maintain emergency, inpatient, obstetric, and other essential services year-round despite dramatic seasonal fluctuations in demand. Fixed staffing and infrastructure costs cannot be reduced proportionately during the off-season, while summer demand requires additional capacity. Severe housing shortages further constrain recruitment, retention, and service expansion, making workforce housing a direct limitation on clinical capacity and financial sustainability.
Reimbursement and Financial Performance: As a small rural hospital, NCH faces reimbursement structures that do not adequately reflect the cost of maintaining essential services on an isolated island. Low patient volumes in certain specialties, high fixed costs, expensive workforce recruitment, and the need for redundant emergency capabilities create financial pressures that traditional volume-based reimbursement does not fully recognize. Additional opportunities may exist to improve revenue capture, payer contracting, service-line performance, and reimbursement for care coordination, telehealth, and services that prevent costly off-island utilization.
Strategic Assets: NCH has significant assets that could generate greater clinical and financial value, including modern hospital infrastructure, established community trust, philanthropic relationships, and access to a broad network of specialists. Opportunities remain to more fully leverage these resources through expanded on-island specialty services, telehealth, shared staffing, coordinated referrals, and innovative care delivery models.
Todd Nida. CEO of East Adams Rural Healthcare (Ritzville, Wash.): Patients are losing value in rural healthcare due to hospitals having to increase volumes to survive which results in less time spent per patient. In today’s reimbursement climate, there is only an incentive to drive higher volumes, not better patient care.
As far as capacity goes, facilities are having to downsize to afford staffing, clinical staff wages have increased exponentially since the COVID era where wages nearly doubled for some specialties, those wages are now expected, so fewer staff have to do more in support roles to offset the increases in labor costs. Nursing wages now challenge admin wages in rural settings. It is very difficult to sustain, especially in states that have mandatory staffing committee rules where the staff sets the clinician to patient ratios.
Reimbursement pretty much goes without saying. Continual reduction in Medicare reimbursement only continues diminishing the bottom line further into the red. Insurance payers continue to leverage small rural facilities, forcing them to accept lower payments. It is becoming a spiral in a very bad direction.
Tammy Dahl, DNP, RN. Chief Nursing Officer of Pullman Regional Hospital (Pullman, Wash.): The 2027 revenue strategy is built around this equation:
Demand × Access × Capacity × Throughput × Capture = Sustainable Growth
That leads to several opportunities for discussion with the Chief Team and the Board:
Referral and transfer leakage. Before adding services, determine what leaves Pullman today: specialty referrals, imaging, procedures, cardiology, post-acute care, diagnostics, etc. Then ask which of those patients could safely and appropriately stay here if we changed access, scheduling, physician coverage, technology, or partnerships. This could reveal more opportunity than adding an entirely new service line.
Unused procedural capacity. Our OR efficiency work is absolutely a revenue strategy. Block utilization, early block release, PAT, first-case starts, turnover, scheduling discipline, staffing to demand, and filling released time can create additional capacity without recruiting another surgeon. We would eventually add the revenue opportunity associated with unused OR hours to the service-line dashboard.
Swing bed as an actual service line. We will no longer view swing bed as simply an inpatient capability; we will manage it like a business. Medicare reimburses CAH swing-bed services at 101% of reasonable cost, rather than under the SNF PPS. That makes our current swing-bed relaunch strategically important. Build referral relationships with tertiary hospitals, orthopedics, families, case managers, and regional SNFs around “recover closer to home.”
Recapture capacity in the ED and Birth Place. Every hour of diversion may represent lost downstream imaging, lab, admission, surgery, pharmacy, follow-up, and future loyalty—not merely a lost ED visit or delivery. I would quantify diversion hours × patients redirected × estimated downstream contribution. Suddenly, capacity management becomes a financial strategy, not just an operational initiative.
Outpatient specialty growth without necessarily employing every specialist. Instead of asking, “Should we recruit another specialist?” ask, “What specialty access does this market need?” Visiting specialists, shared physicians, tele-specialty, co-management, outreach clinics, and university partnerships can build a service line before PRH assumes the full fixed cost. Heart and Lung deserves particular examination given the broader diagnostic and procedural ecosystem it can create.
Heart and Lung Service Line Strategy
For a CAH, heart and lung care are natural partners. Patients with COPD, heart failure, coronary disease, pulmonary hypertension, sleep-disordered breathing, and other chronic conditions often move across the same continuum of care and use many of the same hospital resources. Building a coordinated Heart and Lung service line allows the hospital to manage these patients more effectively across prevention, diagnosis, treatment, rehabilitation, and chronic disease management rather than treating each encounter as an isolated episode.
The opportunity extends beyond physician specialty revenue alone. A strong Heart and Lung program can drive utilization across imaging, laboratory, respiratory therapy, cardiopulmonary diagnostics, rehabilitation, pharmacy, emergency care, inpatient services, and outpatient follow-up. It can also create a much stronger population-health platform for patients with CHF, COPD, hypertension, coronary disease, tobacco-related illness, and other conditions that disproportionately affect rural communities.
For PRH, I think of it as a continuum:
Prevention and Risk Identification
Smoking cessation, hypertension management, lipid screening, diabetes management, obesity prevention, vaccination, lung scans, cardiac CTs, and early identification of cardiovascular and pulmonary risk.
Diagnostics
EKGs, echocardiography, Holter/event monitoring, stress testing, pulmonary function testing, sleep studies where appropriate, chest imaging, CT, laboratory testing, and other cardiopulmonary diagnostics.
Specialty Access
Cardiology and pulmonology consultation through employed, contracted, visiting, or tele-specialty models. This is particularly important in rural communities where full-time specialty recruitment may not initially be financially feasible.
Chronic Disease Management
Structured pathways for heart failure and COPD patients, including medication management, symptom monitoring, patient education, care management, and early intervention before deterioration results in an ED visit or hospitalization.
Rehabilitation
Cardiac rehabilitation and pulmonary rehabilitation are especially attractive because they support both quality and long-term patient engagement while keeping care local.
Acute Care Integration
The service line should connect directly with the ED and inpatient program. A patient presenting with dyspnea may have COPD, heart failure, pneumonia, arrhythmia, pulmonary embolism, or several conditions simultaneously. A coordinated Heart and Lung strategy creates standardized diagnostic and treatment pathways rather than separate departmental approaches.
Population Health
This may ultimately be one of the greatest opportunities. Instead of waiting until a patient with CHF or COPD arrives in crisis, PRH could identify high-risk populations, monitor them proactively, coordinate primary and specialty care, and intervene earlier. That reduces avoidable utilization while strengthening the hospital’s relationship with the community.
And from a service-line economics standpoint, this is important: the financial value is not simply the cardiologist or pulmonologist visit. The service line generates a broader ecosystem of activity:
Specialist visit → diagnostic testing → imaging → lab → respiratory therapy → pharmacy → rehab → outpatient follow-up → inpatient/ED care when needed.
This means we evaluate Heart and Lung as an enterprise service line, not a single specialty.
For the Board discussion, I the strategic question might be something like:
How can PRH become the regional rural destination for coordinated Heart and Lung care—keeping more patients close to home while improving chronic disease management, access, and financial sustainability?
Build around the entire patient journey, not individual departments. Orthopedics, for example, isn’t merely surgery. It is clinic → imaging → pre-op → surgery → anesthesia → rehab/PT → swing bed → follow-up. Women’s health isn’t merely deliveries. It includes prenatal diagnostics, imaging, pelvic health, lactation, postpartum care, and other services. We could even extend this to women and children’s care and tie in our pediatricians. When you begin seeing service lines this way, you discover revenue that departmental budgeting often hides.
Academic medicine as an economic asset. I think PRH may be underestimating this one. We have WSU, other colleges, residents, and students with us and around us. CMS allows CAHs that directly incur approved residency training costs to receive 101% of reasonable costs for qualifying resident training costs. Beyond reimbursement, we can use the academic relationship to create rural rotations, recruitment pipelines, specialty partnerships, research/innovation pilots and “grow our own” workforce pathways.
Revenue-cycle optimization specific to CAH rules. I would commission a focused CAH reimbursement optimization review, separate from a normal revenue-cycle review. CMS generally reimburses CAHs for most Medicare inpatient and outpatient services at 101% of reasonable costs, while Method II permits qualifying reassigned outpatient professional services to be reimbursed at 115% of the applicable fee-schedule amount. Other provisions exist for HPSA bonuses, certain CRNA services, and several other rural payment mechanisms. The question is not whether PRH knows these rules; it is whether you are extracting every legitimate dollar available under them.
340B optimization. As we know, CAHs can qualify for the 340B Drug Pricing Program if they meet HRSA’s ownership/governance requirements. PRH already participates, and we can assess whether all eligible outpatient sites, specialties, and pharmacy arrangements are captured and compliant, rather than assuming the program is already fully optimized.
Behavioral health as an access and ED-capacity strategy. This may not look like traditional revenue growth initially. But behavioral health access can reduce inappropriate ED utilization while creating outpatient services. Medicare permits CAHs meeting the requirements to provide intensive outpatient program services, with CAH IOP services paid at 101% of reasonable cost.
Technology that actually expands capacity. Evaluate remote monitoring, virtual specialty access, AI-supported workflows, and centralized scheduling through a revenue/capacity lens: Does this technology let us care for more people with the workforce we have? That’s a much stronger business case than “digital transformation.”
For the discussion: “Which service lines should we grow?”
We could organize the conversation around five decisions for each service line:
GROW — OPTIMIZE — PARTNER — MAINTAIN — EXIT/REDESIGN
Then give them the same information for every service line:
Community need | Quality/outcomes | Market share/leakage | Capacity | Workforce | Financial contribution | Capital required | Strategic fit | Partnership opportunity
That would be a meaningful evolution for PRH. We would move from a collection of departments and physician services to an intentional portfolio of healthcare businesses that collectively support the hospital’s mission.
Rural hospitals don’t necessarily need to chase more volume—they need to become much more sophisticated about capturing, organizing, and investing in the value already present in their communities.
George Mikitarian. President and CEO of Parrish Medical Center (Titusville, Fla.): All of those components are losing value, especially for the patient, because the current “healthcare system” is not smart, efficient, effective or sustainable for the public’s individual or collective health — only for those for-profit/investor-owned companies selling us the next big “life-saving” device, procedure, technology, medication, etc. It’s less about health and more about financial reward. It’s dumb!
The majority of the healthcare provided by hospitals and hospital systems, including the billions spent on technologies, pharmaceuticals, therapies, gadgets and gizmos, literally makes no difference in our quality of life or longevity. And, much of that care can be provided by non-physicians. In fact, in some instances, it’s all physically harmful, financially damaging and psychologically detrimental.
You don’t make anything better in a flawed system by doing more of it using costly payment systems, buildings, equipment and pharmaceuticals.
Add all of this on top of this supposed “system” being preserved by professional associations, and not being blended with our Public Health system, and you have more reasons why there is waste and ineffectiveness, and quite frankly it all creates one of the worst healthcare systems, by most metrics, in the world.
Colton Anderson. COO of Hammond-Henry Hospital (Geneseo, Ill.): The most significant opportunities in healthcare are no longer found solely in adding resources but in optimizing existing ones. Hidden value leakage occurs when patients struggle to access care, clinical teams operate below their potential, reimbursement opportunities go unrealized, and strategic assets such as data, technology, and workforce capabilities remain underutilized. Health systems that systematically identify and address these gaps can create meaningful gains in quality, efficiency, and financial performance. Unlocking value requires organizations to view operations, care delivery, and strategy as interconnected drivers of long-term success.
Desiree R. Stumpf, BSN, RN. Vice President of Nursing and Regional Chief Nursing Officer of Deaconess Illinois (Marion, Ill.): I believe healthcare loses the most value at the points where patients, capacity, reimbursement, and strategy become disconnected. Patients lose value when access is delayed or care becomes fragmented; capacity loses value when a bed is available, but workforce, discharge processes, specialty coverage, or transfer pathways prevent a patient from reaching it. Reimbursement loses value when the work we do is not fully reflected through documentation, quality outcomes, or efficient care delivery. And strategic assets lose value when we invest in people, technology, or services without integrating them into how care is actually delivered. In rural healthcare, especially, the opportunity is to connect those pieces so that the right patient receives the right care, in the right setting, with the right workforce and resources around them.
Kevin Dishman, MD. Senior Vice President, Chief Medical Officer and Quality Officer of Stormont Vail Health (Topeka, Kan.): Patients, capacity, reimbursement, and strategic assets are losing value whenever they become disconnected from outcomes. Patients lose value when care is fragmented across providers, settings, and technologies, creating delays, duplication, avoidable transfers and complications. Capacity loses value when scarce clinical resources are consumed by administrative burden, inefficient care pathways, and workforce shortages instead of direct patient care. Reimbursement loses value when payment models continue to reward volume rather than prevention, coordination, and measurable health improvement. Strategic assets such as hospitals, clinics, data, technology, and clinical expertise lose value when they operate in silos rather than as integrated networks designed to improve access, quality, and affordability for the communities they serve.
In rural healthcare particularly, the greatest opportunity is not simply adding more resources, but aligning existing resources around population health, physician engagement, digital capabilities, and coordinated care models that create better outcomes for patients and stronger financial sustainability for health systems.
Mark Boucot. President and CEO of Garrett Regional Medical Center (Oakland, Md.) and Potomac Valley Hospital (Keyser, W.Va.): I think we’re losing value the most when operational delays hit financial headwinds head-on. On the capacity front, every time an ED patient is boarded or a discharge gets delayed, a high-demand inpatient bed becomes a cost burden instead of a community resource. At the same time, reimbursement keeps getting squeezed by Medicare rate cuts, relentless and aggressive commercial payer denials, and razor-thin margins. On top of that, expensive assets—whether physical facilities or digital platforms—lose value fast if they aren’t fully integrated across our outpatient and home care networks. Protecting value isn’t about quick operational fixes anymore; it’s about building efficient, connected care models that work for patients and keep the system sustainable.
Justin D. Harris. CEO of Daviess Community Hospital (Washington, Ind.): The obvious factor from this list is reimbursement. As we know, reimbursement continues to get overlooked as the states and the federal government are trying to cut costs, especially in a budget year. It is difficult to hear the reasoning behind Medicare’s proposed 1.68% decrease in the physician payment conversion factor, when costs are consistently rising and there is little to no work being done to try and limit the Big Pharma’s gouging of small and rural hospitals. Therefore, as reimbursement continues to lose value, so do the normal strategic assets of inpatient care, which is why we have to get out of the normal thinking processes of patients in beds and more into ambulatory care development with free-standing imaging and surgery centers, specialty pharmacies, and workplace clinics — the types of care settings that bring care to the patient, not asking patients to drive to us.
Darrell Bodnar. CIO of North Country Healthcare (Whitefield, N.H.): Patients lose value first when they cannot access care in a timely way, and that lost access quickly turns into lost capacity, poorer outcomes, and missed revenue opportunities. Technology can help create capacity by improving scheduling, communication, care navigation, and workflow efficiency. Reimbursement is another area where organizations need to be more disciplined in reducing denials, improving documentation and charge capture, and addressing payer friction.
I also believe many organizations are underutilizing strategic assets, whether those are people, technology, service lines, or physical infrastructure, because they are not always positioned for the most effective use. For plant and capital assets specifically, better predictive analytics can help organizations anticipate replacement needs, avoid reactive spending, and make more strategic investment decisions. Ultimately, the greatest opportunity is to connect access, operational capacity, reimbursement performance, and asset strategy into a single go-forward strategy. There is a tremendous amount of opportunity, but now more than ever organizations need to stay focused, develop a clear strategy, and whenever possible tie cascading goals and performance back to that strategy.
Rohith Saravanan, MD. Vice President of Medical Affairs and Chief Medical Officer of Midland Health (Midland, Texas): Much of the value lost in rural healthcare occurs in the gaps between services and care settings. Patients lose when limited access to primary and specialty care allows manageable conditions to become costly emergencies, while hospitals lose valuable capacity through avoidable admissions and delayed discharges. Reimbursement often fails to adequately reflect patient complexity, care coordination, and the fixed costs of maintaining essential services. Meanwhile, strategic assets, including our physicians, facilities, technology, and regional partnerships, remain underutilized when they operate in silos. The greatest opportunity is to better connect these resources, intervene earlier, and ensure patients receive the right care, in the right setting, at the right time.
Victoria Hanson, PhD. Regional President and CEO of Avera Sacred Heart (Yankton, S.D.): In rural healthcare, value is lost when patients cannot access the right care close to home, capacity is constrained by workforce shortages or inefficient processes, and reimbursement does not keep pace with the cost and complexity of sustaining essential services. Strategic assets also lose value when we treat facilities, technology, partnerships, and workforce investments as separate resources rather than aligning them around the needs of the communities we serve. The opportunity is to connect these pieces—expanding access, strengthening the workforce, optimizing care delivery, and investing deliberately in partnerships and technology that keep care local whenever possible. Ultimately, preserving value means ensuring that rural communities have a sustainable care model that is both financially responsible and responsive to the people who depend on it.
At Avera, rural health is core to our mission, and we have been intentional about building an integrated continuum of care that keeps care close to home whenever possible while connecting rural communities to advanced services when needed. We do this well by combining strong local partnerships with thoughtful use of technology, telemedicine and system resources, allowing us to improve access while stewarding our people and assets responsibly.
Michael Janis. COO of the Southern Illinois Market for Hospital Sisters Health System (Springfield, Ill.): I think we’re losing value when patients can’t access the care we have the resources to provide. We see it in delays with scheduling, operating rooms that aren’t being fully utilized, patients staying in the hospital longer than necessary, and reimbursement challenges that could have been avoided. In rural healthcare, these issues have a bigger impact because we don’t always have the same resources or flexibility as larger markets. I think there’s a real opportunity to improve how our hospitals, physician practices, and outpatient services work together. Sometimes it’s less about adding new services and more about making better use of what we already have.
Nicole Centers. Administrative Director of the Oncology Service Line for SGMC Health (Valdosta, Ga.): Rural healthcare needs more resources, but we must be intentional about where and how we invest them to maximize their value. We are accountable to the communities we serve to address social determinants of health and remove barriers that delay diagnosis and treatment. We lose capacity and reimbursement when workflows are inefficient, technology is underutilized, and clinical operations, IT, and revenue cycle are not aligned. Our strategic assets lose value when we invest in people, equipment, and technology without ensuring our teams have the tools, training, and processes to fully leverage those investments. Being good stewards of our resources means ensuring that everyone, from the teams supporting our systems to those directly caring for patients, is prepared to meet patients where they are and help them get where they need to be. Efficiency alone will not close the gaps in rural healthcare, but thoughtful investment and operational alignment can help us build financially sustainable systems that deliver high-quality, state-of-the-art care close to home.
Morgan May, DNP, RN. Vice President and Associate Chief Nursing Executive of Ballad Health (Johnson City, Tenn.): Healthcare loses value when the patient is ready, but the system is not. We see it when patients wait for the next level of care, when a physical bed cannot become a staffed bed, when reimbursement does not keep pace with the cost of maintaining rural access, and when technology is layered onto outdated workflows instead of transforming them. Strategic assets create their greatest return when workforce, technology, capacity, and care models are designed together. For rural health systems especially, the goal should be simple: make every scarce resource work harder for the patient and the community.
Ginger Raya, EdD. Center Director for UT Health Houston: Rural hospitals are losing value in several areas. Patients are traveling outside their communities for services that could potentially be provided locally, while workforce shortages and limited specialty access leave existing clinical capacity underutilized. On the financial side, payer denials, prior authorization requirements, reimbursement disputes, and the complexities of Medicare cost reporting continue to strain already thin margins. Through our work with rural hospital leaders, I see a real opportunity to address these challenges through shared resources and partnerships, including clinically integrated networks, that can strengthen negotiating power and provide access to specialized expertise without requiring every hospital to build these capabilities on its own. For rural hospitals, the answer is not always more resources. Sometimes it is finding better ways to share the expertise and infrastructure that already exist.
Cynthia Hardy, DNP, RN. Chief Nursing Officer of Haak’u Health Center (Acoma, N.M.): In rural and tribal healthcare, value is often lost when limited workforce capacity, fragmented care coordination, and reimbursement challenges create barriers to timely patient care. Purchase/Referred Care (PRC) is one example where stronger coordination between clinical services, specialty referrals, and financial resources can make a meaningful difference. At Haak’u Health Center, we are strengthening our case management processes to improve continuity of care, support appropriate utilization of resources, and reduce gaps in specialty care access. Ultimately, preserving value in rural healthcare requires aligning clinical operations, patient-centered care, and financial stewardship to build sustainable healthcare systems.
Dallas Killian. Chief Operations Officer of East Adams Rural Healthcare (Ritzville, Wash.): Rural healthcare is losing value in several critical areas, starting with patient care, as hospitals are increasingly pressured to drive higher volumes to survive financially, often at the expense of time spent with each patient. Capacity continues to shrink as facilities struggle to afford staffing, particularly with clinical wages rising significantly since COVID, forcing fewer support staff to take on more responsibilities to offset labor costs. In rural settings, nursing wages are now competing with administrative wages, creating additional financial strain, especially in states with mandated staffing requirements. Reimbursement only makes matters worse, as Medicare payment pressures and commercial insurers’ negotiating leverage continue to squeeze already struggling rural hospitals. Ultimately, rural healthcare is caught in a difficult cycle where the financial incentives often reward higher volumes rather than better patient outcomes, making long-term sustainability increasingly challenging.
Joshua Elder, MD. Vice President of eHealth Clinical Operations for SCP Health (Lafayette, La.): Reimbursement pressures are felt across healthcare, but rural communities often feel them the most, as an increasingly unfavorable payer mix leaves fewer resources to sustain care close to home. That makes every avoidable loss costly – for patients, hospitals, and communities. Patients lose the most when they are transferred due to a gap in coverage, not a gap in capability, taking them away from their families, their physicians, and the continuity that supports recovery. The hospital loses community trust and revenue along with them. Capacity is lost in similar ways: beds that are staffed on paper but not at 2 a.m., and swing or observation beds that sit empty because no one is available to admit. Hybrid care models built as core capacity, not a stopgap, extend the local team so rural hospitals can keep patients close to home and sustain the value of care they are already equipped to deliver.
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