The COVID-19 pandemic has placed a significant and unexpected financial burden on rural health-care providers who were already struggling to maintain hospitals and clinics that help keep small-town residents — and their communities — alive and well.
A slowdown in patient visits and drop in medical procedures due to fears of spreading the virus have led to a major loss of revenues for medical providers and health-care systems that serve rural areas. While the virus has not led to mass infections in small towns, the drop-off in activity and billable services has put stress on the already fragile financial state of many rural clinics, small hospitals and dental offices.
With the first wave of the pandemic possibly over, more safety measures in place and life returning somewhat to normal, most clinics and hospitals in rural South Dakota have headed off any imminent concern of closure.
Yet in a rural health-care system made up of a patchwork of providers and hospital systems, the losses from the pandemic could curtail the hiring of health-care workers, slow plans to expand services, and further restrict access to health care for hundreds of thousands of small-town and rural residents of the state.
In a state of 885,000 people spread out over roughly 76,000 square miles, and with only nine of 66 counties having more than 20,000 people, South Dakota is among the most rural of all states and home to a heavily diffused population. Even before the pandemic, that equation presented a major challenge for health-care providers to serve small-town and remote populations, and do so in a financially viable manner. Likewise, rural residents have a hard time getting adequate preventive, maintenance, emergency and palliative health care.
“Do I think rural health care is at risk? Absolutely,” said Thomas Worsley, president of Spearfish Hospital and Hills Markets for Monument Health, the largest West River medical system. “It’s always going to be at risk because it’s not a profitable endeavor or something that is going to attract big dollars, but it’s something that fills a real need in these rural communities.”
Worsley, who also serves on the Future of Rural Health Task Force within the American Hospital Association, said the challenge for rural health-care providers and hospital groups is to maintain the highest level of care possible while also protecting the overall financial viability of the health-care system.
“If you polled all these rural health-care CEOs [on the task force], I think they all feel like they’re fighting for their lives on a daily and yearly basis,” he said.
Horizon Health Care, a rural health provider with more than two dozen medical and dental clinics in small towns across South Dakota, saw its revenue fall by roughly half in the weeks after the pandemic hit and patients began staying home, according to Wade Erickson, chief financial and operations officer.
By early June, patient activity and revenues had returned to about 90 percent of normal, Erickson said, and the group benefited from receiving about $3 million in emergency aid from the federal CARES Act pandemic bailout fund.
The aid and bounce back in procedures have been critical to Horizon, based in Howard, but especially to its patients in rural communities who are never turned away because of ability to pay, Erickson said. About a third of Horizon’s funding comes from the federal government, and about 20 percent of its patients are uninsured.
“In really rural communities where we are, just about touching every corner of South Dakota, we’re really the only access to care that they have,” Erickson said.
Challenging across the state
Access to health care remains a serious challenge in much of rural South Dakota.
The South Dakota Office of Rural Health has performed a needs assessment that ranks all 66 counties in terms of resident health status, access to health care and other health-risk factors. Ten counties — all rural and several home to Native American reservations — have consistently ranked in the bottom quartile in all health and access categories (Buffalo, Bennett, Corson, Dewey, Gregory, Jackson, Mellette, Roberts, Todd and Ziebach.)
The pandemic has heightened the challenge of providing medical care to rural areas and small towns that the vast majority of South Dakotans call home.
The rural medical system in South Dakota varies by location, but in general, health care is provided through an informal continuum of care in which patients must travel more owing to the remoteness of their residence or as their care needs increase.
The smallest towns and most remote areas likely have no local health-care provider; as towns get larger, they are more likely to have non-emergency clinics that provide basic diagnostics or treatment during regular business hours; medium-size cities often have a “Critical Access Hospital” with 24/7 emergency services and greater diagnostic and treatment capabilities that qualify for significant federal funding; and urban areas are home to full-service hospitals with critical care, extensive diagnostics, multiple surgical options and specialty providers. In major medical emergencies, rural residents can expect to drive hundreds of miles or pay for a ride in an ambulance or a helicopter in order to survive.
Federal data show that rural residents fare worse than their urban counterparts in several health-related categories, such as death rates from cancer, heart and lung disease and from accidents. They also tend to have higher rates of obesity and a lower life expectancy. While attitudes about medical care may play a role, medical experts say a lack of access to preventive care and a variety of treatment options is also a factor.
The pandemic has made it even harder for Native Americans in South Dakota to get health care at any level, from preventive and emergency care to treatment for major illnesses or by specialists, said Jerilyn Church, CEO of the Great Plains Tribal Chairmen’s Health Board.
Native Americans have access to care at federally supported Indian Health Service facilities, but those hospitals have been underfunded for years, Church said.
“Indian Health Services have been funded at 50 percent of the need for a really long time,” Church said. “So, while facilities are there, they’re not designed to meet the need and demand of what is needed.”
During the pandemic, the urban medical centers in South Dakota collectively lost hundreds of millions of dollars in revenue due to a lack of elective surgeries and routine and preventive care. Though federal emergency funding has helped counter those losses, some staff was laid off and the long-term impacts are still unknown.
Because they already had small staffs, most rural clinics were unable to cut positions or reduce services, though those providers also aren’t yet sure what the future may hold as billing cycles close and revenue reductions become fully clear. As a result, the long-range effects of the pandemic on rural health care in South Dakota are not yet known.
“Imagine running an operation that is mostly staff salaries and your revenue is cut in half or by a third, and you still have to try to make that work,” said Shelly Ten Napel, CEO of the Community Healthcare Association of the Dakotas, which represents rural health providers.
Before and during the pandemic, Ten Napel has lobbied for greater state and federal support for community hospitals and clinics.
“Without help, we would not make it through this, or we would just make it and it would be such a different picture of [which] communities providers can afford to be in,” she said.
Even with federal CARES Act aid, however, Ten Napel said elected officials, policymakers and the public must think deeply about the need for rural health care and find ways to continue to support providers who serve small communities.
“We as a community need to figure out what services we think are important and figure out a way to support that. It’s not enough to say, ‘Well, this is a small town, it’s not economically viable so they’re just not going to have health care,’” she said.
Ten Napel and others say that if rural health care is allowed to diminish, small towns in South Dakota and across the country — and the cherished way of life they provide — may falter or even cease to exist.
“We talk about the life of a town and a community and we’ve all seen different exoduses from Main Street, but once you get down to losing your health care, your school, your grocery store, a few of those core entities, at what point does a community become non-viable?”