This can lead to a downward spiral, in which the already fewer number of commercially insured patients that live nearby begin preferring to travel rather than avail themselves of a facility which they have begun to perceive as providing limited or substandard care. The additional reduction in commercially insured patients may result in further decline in the hospital’s services and reputation, further financial strain, and in turn, more budget cuts.

Though there has been an increasing rate of hospital closures for decades, the Affordable Care Act’s impact on Medicare and Medicaid reimbursement rates caused additional strain on the already small margins of rural hospitals.

Indeed, in 2019, a study by University of Washington researchers found that such closures in rural areas caused a 5.9 percent rise in mortality rates. However, there is conflicting research on the issue.

In 2015, Health Affairs published a national study of hospital closures over the preceding decade which found no evidence of any worse health outcomes following hospital closures. The results were again reproduced when specifically limited to closures within low-income rural areas on the assumption that patients there would be more negatively impacted. However, again they found no evidence of worse health outcomes following closure when looking only at those target service areas. Curiously, in some instances they actually noted a measurable reduction in mortality rates compared with controls.

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