Originally created 05/10/04

Rural hospitals fight for survival



FAIRFAX, S.C. - The small-town hospital is the mother ship for doctors practicing in the outback of South Carolina and Georgia, rural health experts say, but these local institutions are being withered by the same economic pressures slamming big-city and suburban medical centers.

Without a local hospital, a rural county's health care depends on a thin line of doctors practicing basic medicine with little support, forced to send patients to urban medical centers for services ranging from emergency surgery and cancer treatment to baby deliveries.

With a hospital, a rural county gets an emergency room, extra beds, the probability of a surgeon or other medical specialist and a key selling point for recruiting medical talent.

"If you take a rural hospital out of a community, you cripple its ability to attract new physicians," said Glenn Pearson, the executive vice president of the Georgia Hospital Association.

Soaring medical malpractice premiums, high unemployment and a dwindling number of commercial insurance patients are leaving rural hospitals dependent on Medicaid patients and payments that don't cover costs.

As a result, rural hospitals are either closing or sharply reducing their services. Many, including Edgefield County Hospital, have stopped delivering babies to avoid high malpractice premiums for obstetrics.

Some have been forced to take drastic short-term measures to stay open. To cover its premiums, Bacon County Hospital, in Alma, Ga., recently took out a loan, Mr. Pearson said.

"Rural hospitals cannot sustain 200 and 300 percent increases in medical malpractice premiums," he said. "They're reducing services. They're laying off employees."

Since 1996, 15 Georgia hospitals have closed, said Mr. Pearson, more than half of them in rural counties.

Last year, 58 percent of the acute-care hospitals in Georgia lost money, he said. Acute-care hospitals are the front-line facilities of the health system, handling emergency cases and patients with rapidly developing illnesses.

Since 1985, only two hospitals have closed in South Carolina, said Jim Walker, the executive director of the South Carolina Hospital Association, but rural Palmetto State hospitals are shedding services and employees.

"Our hospitals don't exist in a vacuum, and our hospitals reflect what's going on in the economies of their communities," Mr. Walker said.

Small-town hospitals are more vulnerable to the financial pressures of American health care because they are less able to shift their costs from the uninsured and underinsured to patients carrying commercial health insurance, said Pete Bailey, a health care specialist with the research office of the South Carolina Budget and Control Board.

That's because rural counties are losing textile mills and other prime employers, Mr. Bailey said. With the loss of jobs comes the loss of commercial insurance coverage.

Small-town hospitals also face competition from suburban and big-city medical centers that are either setting up satellite clinics or poaching the business of a rural county's few remaining large employers, Mr. Bailey said.

"What concerns me is whether we're moving headlong down a road that leads to the closure of rural hospitals," he said.

He sees the rise of a vicious cycle for rural health care.

"It's not just a hospital and physician problem, it's a community problem," Mr. Bailey said. "If that hospital closes, a lot of those doctors will be gone, and then you have a problem attracting jobs and industry that needs to see that hospital before coming in. Then you're talking about rural really being rural because people will be gone."

This means the problem of rural health care isn't merely a matter of not having enough doctors or evening the distribution disparity between urban and rural areas, said Mark Jordan, a rural health care specialist with the South Carolina Department of Health and Environmental Control.

To combat this trend, many small-town hospitals are petitioning federal health officials to be designated as critical-access facilities.

In return for a higher reimbursement rate from Medicare that covers more than 100 percent of their costs, hospitals that gain this status agree to limit their services and form partnerships with larger hospitals offering a fuller range of care, said Sam Gregory, the administrator of Edgefield County Hospital, a 32-year-old, 40-bed facility that provided the final living quarters for Strom Thurmond.

"Reimbursement and the lack thereof is a big problem," said Mr. Gregory, whose board is considering the critical-access designation.

Small hospitals make a difference in the spectrum of health care available in predominantly rural South Carolina jurisdictions such as Barnwell, Allendale and Edgefield counties.

Barnwell County's 22 doctors include a cardiologist, a surgeon, a dermatologist and four emergency room physicians. Edgefield County's 19 physicians include three surgeons, one of them a thoracic and cardiovascular specialist.

Having the extra bed space of Allendale County Hospital also provides doctors a chance to keep patients close to home.

"It's essential we have someplace we can put them in and take care of them and provide them with a continuum of care," said Dr. Eddie Richardson, the medical director at Low Country Health Systems Inc., a rural clinic near the hospital.

In contrast, McCormick County has no hospital and only five doctors - four primary-care physicians and one psychiatrist.

"People, when they look to relocate, want to know there's quality health care nearby rather than having to drive 25 or 30 miles to the nearest hospital," said Mr. Gregory. "It gives everybody a comfort level."

Reach Jim Nesbitt at (803) 648-1395 or jim.nesbitt@augustachronicle.com.