Too many rural hospitals are threatened

When the One Big Beautiful Bill was signed into law on July 4^th, many wondered what impact it would have on North Carolina. We have yet to see the full impact but already there are signals.

At least eight rural hospitals in our state are near closing their doors. And there are more sweating but not yet revealing their plight.

According to the NC Department of Health and Human Services, Medicaid provides health coverage to 1 in 4 North Carolinians. 21 percent of the people covered are older adults and citizens with disabilities. 67 percent of our nursing home residents rely on Medicaid to pay for long term care. And more than half the population in rural counties rely on Medicaid. That’s more than 3 million North Carolinians.

When North Carolina finally agreed to expand Medicaid, beginning in 2023, we threw our hospitals, especially rural ones, a lifeline. Prior to that time citizens who did not have medical insurance were forced to seek medical treatment at the emergency room of their local hospital.

Not only did these visits increase the wait time other patients but it was the most expensive healthcare offered. It put strains on the hospital operations.

The federal government provides a percentage of Medicaid costs (about 69 percent) and the states make up the rest. Medicaid payments don’t cover 100 percent of a hospital’s costs, but the promise of expanding Medicaid was that the feds would pay 90 percent of the costs and the state would make up the difference.

Medicaid expansion provided health insurance for nearly 600,000 North Carolinians. They could now seek treatment from traditional medical providers, taking a huge financial burden off the hospital emergency room. In fact, North Carolina hospitals even offered to make up the difference between what Medicaid paid and what care providers charged.

We don’t fully know how much impact the OBBB will have on our state yet. The provisions don’t take effect until 2028 and it is likely changes could be made before they do so, therefore our legislature has not devised their response to the cuts. For the fiscal year that started July 1 it was decided that we would fund Medicaid the same as last year.

DHHS informed the legislature that to do so would require an additional $819 million from the state. For reasons not fully understood lawmakers, in one of the mini budgets they passed, decided to fund only $619 million, creating a $319 million shortfall. DHHS informed the legislature that if the shortfall was not filled they would be forced to reduce the reimbursements they provide to caregivers….doctors, clinics, hospitals.

Beginning October, 1 DHHS informed caregivers that they would reduce Medicaid claims by an average of 4 percent and even more for certain services.

At least eight rural hospitals in our state are under very real threat of closing. The list includes UNC Rockingham at Eden, Person Memorial in Roxboro, UNC Health in Siler City, MH Angel Medical Center in Franklin, Blue Ridge Regional Hospital in Spruce Pine, Washington Regional Hospital in Plymouth, UNC Lenoir Health Care in Kinston, and Vidant Chowan Hospital in Ahoskie. Martin General in Williamston is one of 5 hospitals in our state that have closed over the past few years.

The hospitals all have several things in common. First, they have a large percentage of patients who are Medicaid patients. And 48 percent of rural hospitals are losing money or barely breaking even.

Let’s lay out the options, beginning with the federal EMTALA Act, the Emergency Medical Treatment and Labor Act. This is federal law that says that anyone coming to an emergency department requesting care is required to receive a medical screening examination and stabilizing treatment, regardless of their ability to pay.

Hospitals are bound by this act. Who pays for the treatment when an uninsured patient comes to the emergency room? Right now it is most often Medicaid. If Medicaid payments are substantially reduced or cut, hospitals will be forced to cut back on other services, like obstetrics, surgeries or behavioral health. Some will just choose to close, forcing patients to drive many miles for treatment. Others could choose to become just an emergency hospital, refusing to provide their community with other services.

Without Medicaid and nearby hospitals many will just choose not to get healthcare. We know what the result of this choice is. Without healthcare the patient’s health can decline to a point where more expensive emergency healthcare is required, costing more dollars

We can ill afford to lose our hospitals and should not renege on our country’s longstanding promise to help our fellow man. People of good will need to step up and help find solutions.

Tom Campbell is a Hall of Fame North Carolina broadcaster and columnist who has covered North Carolina public policy issues since 1965.  Contact him at tomcamp@carolinabroadcasting.com