Coronavirus threatens financial health of Colorado’s struggling rural hospitals

About half of Memorial Regional Health’s revenue comes from outpatient, non-emergency services — the kind most likely to be threatened by the coronavirus pandemic — and the Craig hospital could be forced to make painful cuts if the disease lingers.

Michelle Mills, CEO of the Colorado Rural Health Center, said it’s difficult to predict how severe the effects of the respiratory disease COVID-19 might be, but 18 of Colorado’s rural hospitals already were losing money before the virus hit, and another financial hit might force some to close.

Rural hospitals around the country are facing the same reckoning, as they cancel money-making elective services to slow the new virus’ spread, according to Kaiser Health News.

Gov. Jared Polis’ order that hospitals stop offering elective procedures exempted critical access hospitals, but some have stopped on their own, she said. “Critical access hospital” is a federal designation for small hospitals that are a significant distance from another facility, and are eligible for higher payments from Medicare than most other hospitals.

Jennifer Riley, vice president of operations at Memorial Regional Health, said the hospital is still performing elective surgeries, but administrators conduct a risk assessment each day to determine whether it’s time to stop. If it becomes unsafe to keep offering elective services, the hospital would have to have to lay off some people, at least temporarily, or reduce salaries to preserve critical services like emergency room care, she said.

Riley said she hopes that Congress will raise Medicare and Medicaid rates enough to offset the revenue hospitals are losing.

“Rural hospitals are critical to supporting the statewide health system,” she said.

The White House and top Democrats had agreed on a $100 billion fund for struggling hospitals, as well as an increase in Medicare rates, according to The New York Times. It’s difficult to predict how much Colorado’s rural hospitals might benefit, though.

Some ideas are floating around at the federal level to support rural health care, like allowing Medicare to pay for telemedicine visits that rural clinics conduct, Mills said. But the surest way of protecting rural hospitals would to offer cash assistance to get them through the crisis, she said.