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Purpose: Hospitals are increasingly the target of cybersecurity threats, including ransomware attacks. Little is known about how ransomware attacks affect care at rural hospitals., Methods: We used data on hospital ransomware attacks from the Tracking Healthcare Ransomware Events and Traits database, linked to American Hospital Association survey data and Medicare fee-for-service (FFS) claims data from 2016 to 2021. We measured Medicare FFS volume and revenue in the inpatient, outpatient, and emergency room setting-at the hospital-week level. We then conducted a stacked event study analysis, comparing hospital volume and revenue at ransomware-attacked and nonattacked hospitals before and after attacks., Findings: Ransomware attacks severely disrupted hospital operations-with comparable effects observed at rural versus urban hospitals. During the first week of the attack, inpatient admissions volume fell by 14.7% at rural hospitals (P = .04) and 16.9% at urban hospitals (P = .01)-recovering to preattack levels within 2-3 weeks. Outpatient visits fell by 35.3% at rural hospitals (P<.01) and 22.0% at urban hospitals (P = .03) during the first week. Emergency room visits fell by 10.0% at rural hospitals (P = .04) and 19.3% at urban hospitals (P = .01). Travel time and distance to the closest nonattacked hospital was 4-7 times greater for rural ransomware-attacked hospitals than for urban ransomware-attacked hospitals., Conclusions: Ransomware attacks disrupted hospital operations in rural and urban areas. Disruptions of similar magnitudes may be more detrimental in rural areas, given the greater distances patients must travel to receive care and the outsized impact that lost revenue may have on rural hospital finances., (© 2024 The Author(s). The Journal of Rural Health published by Wiley Periodicals LLC on behalf of National Rural Health Association.)

Rationale: Intermediate care (also termed "step-down" or "moderate care") has been proposed as a lower cost alternative to care for patients who may not clearly benefit from intensive care unit admission. Intermediate care units may be appealing to hospitals in financial crisis, including those in rural areas. Outcomes of patients receiving intermediate care are not widely described. Objectives: To examine relationships among rurality, location of care, and mortality for mechanically ventilated patients. Methods: Medicare beneficiaries aged 65 years and older who received invasive mechanical ventilation between 2010 and 2019 were included. Multivariable logistic regression was used to estimate the association between admission to a rural or an urban hospital and 30-day mortality, with separate analyses for patients in general, intermediate, and intensive care. Models were adjusted for age, sex, area deprivation index, primary diagnosis, severity of illness, year, comorbidities, and hospital volume. Results: There were 2,752,492 hospitalizations for patients receiving mechanical ventilation from 2010 to 2019, and 193,745 patients (7.0%) were in rural hospitals. The proportion of patients in rural intermediate care increased from 4.1% in 2010 to 6.3% in 2019. Patient admissions to urban hospitals remained relatively stable. Patients in rural and urban intensive care units had similar adjusted 30-day mortality, at 46.7% (adjusted absolute risk difference -0.1% [95% confidence interval, -0.7% to 0.6%]; P  = 0.88). However, adjusted 30-day mortality for patients in rural intermediate care was significantly higher (36.9%) than for patients in urban intermediate care (31.3%) (adjusted absolute risk difference 5.6% [95% confidence interval, 3.7% to 7.6%]; P  < 0.001). Conclusions: Hospitalization in rural intermediate care was associated with increased mortality. There is a need to better understand how intermediate care is used across hospitals and to carefully evaluate the types of patients admitted to intermediate care units.

Importance: Emergency department (ED) visits are common and increasing. Whether outcomes associated with care in the ED are improving over time is largely unknown to date., Objective: To examine trends in 30-day mortality rates associated with ED care among Medicare beneficiaries aged 65 years or older., Design, Setting, and Participants: This cross-sectional study used a random 5% sample in 2009 and 2010 and a 20% sample from 2011 to 2016, for a total of 15 416 385 ED visits from 2009 to 2016 among Medicare beneficiaries aged 65 years or older., Exposures: Time (year) as a continuous variable., Main Outcomes and Measures: The primary outcome was 30-day mortality, overall and stratified by illness severity and hospital characteristics. Secondary outcomes included mortality rates on the day of the ED visit (day 0) as well as at 7 and 14 days. Changes in disposition from the ED (admission, observation, transfer, died in the ED, and discharged) over time were also examined., Results: The sample included 15 416 385 ED visits (60.8% women and 39.2% men; mean [SD] age, 78.6 [8.5] years) at 4828 acute care hospitals. The percentage of patients discharged from the ED increased from 53.6% in 2009 to 56.7% in 2016. Unadjusted 30-day mortality declined from 5.1% in 2009 to 4.6% in 2016 (-0.068% per year; 95% CI, -0.074% to -0.063% per year; P < .001). After adjusting for hospital random effects, patient demographics, and chronic conditions, the adjusted 30-day mortality trend was -0.198% per year (95% CI, -0.204% to -0.193% per year; P < .001). The magnitude of this trend was greatest for patients with a high severity of illness (-0.662%; 95% CI, -0.681% to -0.644%; P < .001), followed by those with a medium severity of illness (-0.103% per year; 95% CI, -0.108% to -0.097% per year; P < .001) and those with a low severity of illness (-0.009% per year; 95% CI, -0.006% to -0.011% per year; P < .001). Declines in mortality were seen in each category of ED disposition, including visits resulting in admission (-0.356% per year; 95% CI, -0.368% to -0.343% per year; P < .001) as well as those resulting in discharge (-0.059% per year; 95% CI, -0.064% to -0.055% per year; P < .001). The decline was greater for major teaching hospitals (compared with nonteaching hospitals), nonprofit hospitals (compared with for-profit hospitals), and urban hospitals (compared with rural hospitals)., Conclusions and Relevance: Among Medicare beneficiaries receiving ED care in the United States, mortality within 30 days of an ED visit appears to have declined in recent years, particularly for patients with the highest severity of illness, even as fewer patients are being admitted from an ED visit. This study's findings suggest that further study is needed to understand the reasons for this decline and why certain types of hospitals are seeing greater improvements in outcomes.

In 2010 Maryland replaced fee-for-service payment for some rural hospitals with "global budgets" for hospital-provided services called Total Patient Revenue (TPR). A principal goal was to incentivize hospitals to manage resources efficiently. Using a difference-in-differences design, we compared eight TPR hospitals to seven similar non-TPR Maryland hospitals to estimate how TPR affected hospital-provided services. We also compared health care use by "treated" patients in TPR counties to that of patients in counties containing control hospitals. Inpatient admissions and outpatient services fell sharply at TPR hospitals, increasingly so over the period that TPR was in effect. Emergency department (ED) admission rates declined 12 percent, direct (non-ED) admissions fell 23 percent, ambulatory surgery center visits fell 45 percent, and outpatient clinic visits and services fell 40 percent. However, for residents of TPR counties, visits to all Maryland hospitals fell by lesser amounts and Medicare spending increased, which suggests that some care moved outside of the global budget. Nonetheless, we could not assess the efficiency of these shifts with our data, and some care could have moved to more efficient locations. Our evidence suggests that capitation models require strong oversight to ensure that hospitals do not respond by shifting costs to other providers.

In a substantial shift in payment policy, the State of Maryland implemented a global budget program for acute care hospitals in 2010. Goals of the program include controlling hospital use and spending. Eight rural hospitals entered the program in 2010, while urban and suburban hospitals joined in 2014. Prior analyses, which focused on urban and suburban hospitals, did not find consistent evidence that Maryland's program had contributed to changes in hospital use after two years. However, these studies were limited by short follow-up periods, may have failed to isolate impacts of Maryland's payment change from other state trends, and had limited generalizability to rural settings. To understand the effects of Maryland's global budget program on rural hospitals, we compared changes in hospital use among Medicare beneficiaries served by affected rural hospitals versus an in-state control population from before to after 2010. By 2013-three years after the rural program began-there were no differential changes in acute hospital use or price-standardized hospital spending among beneficiaries served by the affected hospitals, versus the within-state control group. Our results suggest that among Medicare beneficiaries, global budgets in rural Maryland hospitals did not reduce hospital use or price-standardized spending as policy makers had anticipated.

Context: Evidence suggests an association between rurality and decreased life expectancy., Objective: To determine whether rural hospitals have higher hospital mortality, given that very sick patients may be transferred to regional hospitals., Design: In this ecologic study, we combined Medicare hospital mortality ratings (N = 1267) with US census data, critical access hospital classification, and National Center for Health Statistics urban-rural county classifications. Ratings included mortality for coronary artery bypass grafting, stroke, chronic obstructive pulmonary disease, heart attack, heart failure, and pneumonia across 277 California hospitals between July 2011 and June 2014. We used generalized estimating equations to evaluate the association of urban-rural county classifications on mortality ratings., Main Outcome Measures: Unfavorable Medicare hospital mortality rating "worse than the national rate" compared with "better" or "same.", Results: Compared with large central "metro" (metropolitan) counties, hospitals in medium-sized metro counties had 6.4 times the odds of rating "worse than the national rate" for hospital mortality (95% confidence interval = 2.8-14.8, p < 0.001). For hospitals in small metro counties, the odds of having such a rating were 3.7 times greater (95% confidence interval = 0.7-23.4, p = 0.12), although not statistically significant. Few ratings were provided for rural counties, and analysis of rural counties was underpowered., Conclusion: Hospitals in medium-sized metro counties are associated with unfavorable Medicare mortality ratings, but current methods to assign mortality ratings may hinder fair comparisons. Patient transfers from rural locations to regional medical centers may contribute to these results, a potential factor that future research should examine.

The purpose of this study was to assess EHR Incentive Program attestations of eligible US hospitals across geography and hospital type. The proportions of attestations were compared between metropolitan, micropolitan, and rural hospitals and by whether a hospital was critical access or prospective payment system. From 2011 until December 2013, rural and critical access hospitals were attesting to meaningful use and receiving federal incentive payments at a significantly lower proportion than their urban counterparts. The data suggest that the digital divide between urban and rural hospitals that are adopting electronic health records and using the technology effectively is widening. These findings illustrate that the needs of rural hospitals currently and into the future are different than urban hospitals, and the meaningful use program does not appear to provide the resources needed to propel these rural hospitals forward.

Importance: Critical access hospitals (CAHs) provide inpatient care to Americans living in rural communities. These hospitals are at high risk of falling behind with respect to quality improvement, owing to their limited resources and vulnerable patient populations. How they have fared on patient outcomes during the past decade is unknown., Objective: To evaluate trends in mortality for patients receiving care at CAHs and compare these trends with those for patients receiving care at non-CAHs., Design, Setting, and Patients: Retrospective observational study using data from Medicare fee-for-service patients admitted to US acute care hospitals with acute myocardial infarction (1,902,586 admissions), congestive heart failure (4,488,269 admissions), and pneumonia (3,891,074 admissions) between 2002 and 2010., Main Outcome Measures: Trends in risk-adjusted 30-day mortality rates for CAHs and other acute care US hospitals., Results: Accounting for differences in patient, hospital, and community characteristics, CAHs had mortality rates comparable with those of non-CAHs in 2002 (composite mortality across all 3 conditions, 12.8% vs 13.0%; difference, -0.3% [95% CI, -0.7% to 0.2%]; P = .25). Between 2002 and 2010, mortality rates increased 0.1% per year in CAHs but decreased 0.2% per year in non-CAHs, for an annual difference in change of 0.3% (95% CI, 0.2% to 0.3%; P < .001). Thus, by 2010, CAHs had higher mortality rates compared with non-CAHs (13.3% vs 11.4%; difference, 1.8% [95% CI, 1.4% to 2.2%]; P < .001). The patterns were similar when each individual condition was examined separately. Comparing CAHs with other small, rural hospitals, similar patterns were found., Conclusions and Relevance: Among Medicare beneficiaries with acute myocardial infarction, congestive heart failure, or pneumonia, 30-day mortality rates for those admitted to CAHs, compared with those admitted to other acute care hospitals, increased from 2002 to 2010. New efforts may be needed to help CAHs improve.

Critical Access Hospitals (CAHs) receive cost-based reimbursement from Medicare for inpatient care, including post-acute skilled care provided in swing beds (skilled swing days). Because the reimbursement formula treats swing bed and acute days equally, there is concern that CAH skilled swing days are "overreimbursed" as compared with skilled days provided in other settings. The reimbursement formula is complex; thus, empirical estimates are needed to identify the marginal cost per day to the hospital and the implied Medicare expenditure per day, accounting for fixed cost transfers between services. Using Medicare cost report data, we find that Medicare paid, on average, $581 for the routine portion of a CAH skilled swing day in 2009--more than the estimated marginal cost of $262, but less than the 2009 average per diem of $1,302. Estimates varied widely across the 1,300 CAHs; therefore, payment policy changes would likely have a broad range of effects.

Purpose: Medicare cost reports (MCR), Internal Revenue Service form 990s (IRS 990), and audited financial statements (AFS) vary in their content, detail, purpose, timeliness, and certification. The purpose of this study was to compare selected financial data elements and characterize the extent of differences in financial data and ratios across the MCR, IRS 990, and AFS for a sample of nonprofit critical access hospitals (CAHs)., Methods: Line items from AFS of 47 CAHs were compared to data reported in the hospitals' MCR and IRS 990s. Line items were based on 9 financial indicators commonly used to assess hospital financial performance., Findings: Of the indicators examined, the equity financing ratio most frequently matched between the 3 reports, while salaries and benefits to total expenses and debt service coverage were often different. Variances were driven by differences in individual account balances used to construct the ratios. Relative to AFS, cash was frequently lower on the IRS 990 while marketable securities and unrestricted investments were often higher. Other revenue and net income were consistently lower on the MCR and IRS 990, and depreciation was often higher on the MCR. The majority of total assets and fund balance (equity) values matched across the 3 reports, suggesting differences in classification among detailed accounts were more common than variances between the component totals (total assets, total liabilities, and fund balance)., Conclusions: Health policy researchers should consider the impact of these variances on study results and consider ways to improve the availability and quality of financial accounting information., (© 2012 National Rural Health Association.)

Unlabelled: CONTEXT/PURPOSE: Most rural hospitals can provide medical care to acute myocardial infarction (AMI) patients, but a need for advanced cardiac care requires timely transfer to a tertiary hospital. There is little information on AMI in-hospital mortality predictors among rural transfer patients., Methods: Cross-sectional retrospective analyses on 2003-2005 Medicare hospital inpatient data from 5 states were conducted to compare predictors of in-hospital AMI mortality between rural hospital transferred and nontransferred patients. A total of 9,690 rural hospital AMI patients were identified: 3,087 were transferred to receiving hospitals and 6,603 were not transferred. Separate logistic regressions were conducted for transferred and nontransferred patient cohorts and results were compared., Results: Transfer patients were younger, more likely male, had fewer comorbidities/complications, and were less likely to expire (5.3% vs 16.7%) in the hospital. Congestive heart failure and cardiac dysrhythmia were the most common comorbidities/complications among transfer and no-transfer AMI patients, but shock (OR = 9.44) and acute renal failure (OR = 3.67) had the strongest associations with in-hospital mortality for both cohorts. Undergoing a percutaneous coronary intervention (PCI) was associated with a 42% reduction in hospital mortality risk for transfer patients., Conclusions: Transfer was associated with a greater likelihood of in-hospital AMI survival, largely but not fully explained by transfer patients being younger with fewer comorbidities/complications who are receiving advanced cardiac care. Additional studies are needed to clarify other factors that explain higher in-hospital mortality among nontransfers, such as patients' health care decision-making., (© 2011 National Rural Health Association.)

Background: In the mid-1990s, significant gaps existed in the quality of acute myocardial infarction (AMI) care between rural and urban hospitals. Since then, overall AMI care quality has improved. This study uses more recent data to determine whether rural-urban AMI quality gaps have persisted., Methods: Using inpatient records data for 34,776 Medicare beneficiaries with AMI from 2000-2001, unadjusted and logistic regression analysis compared receipt of 5 recommended treatments between admissions to urban, large rural, small rural, and isolated small rural hospitals as defined by Rural Urban Commuting Area codes., Results: Substantial proportions of hospital admissions in all areas did not receive guideline-recommended treatments (eg, 17.0% to 23.6% without aspirin within 24 hours of admission, 30.8% to 46.6% without beta-blockers at arrival/discharge). Admissions to small rural and isolated small rural hospitals were least likely to receive most treatments (eg, 69.2% urban, 68.3% large rural, 59.9% small rural, 53.4% isolated small rural received discharge beta-blocker prescriptions). Adjusted analyses found no treatment differences between admissions to large rural and urban area hospitals, but admissions to small rural and isolated small rural hospitals had lower rates of discharge prescriptions such as aspirin and beta-blockers than urban hospital admissions., Conclusions: Many simple guidelines that improve AMI outcomes are inadequately implemented, regardless of geographic location. In small rural and isolated small rural hospitals, addressing barriers to prescription of beneficial discharge medications is particularly important. The best quality improvement practices should be identified and translated to the broadest range of institutions and providers.

About 45 percent of rural patients in Colorado bypassed their local rural hospitals during the 1990s. The effect of this phenomenon is a reduction in occupancy rates and a decrease in the competitiveness of rural hospitals, thereby ultimately causing rural hospitals to close and adversely affecting the communities that they were designed to serve. This study tests whether hospital ownership affects hospital choice by patients after controlling for institutional and individual dimensions. A conditional logistic regression is used to analyze Colorado Inpatient Discharge Data (CIDD) on 85,529 patients in addition to hospital data. Rural Medicare beneficiaries are influenced to choose a particular hospital by a combination of hospital characteristics (the number of beds, the number of services, accreditation, ownership type, and distance from patient residence) and patient characteristics (medical condition, age, gender, race, and total charge for services). Increasing rural hospitals' survivability, collaborating with other rural hospitals, expanding the number of available services, making strategic alliance with other providers are possible strategies that may help ward off encroachment by urban competitors.

In this policy brief, we explore how predictions of changes in hospital financial performance as a result of change in Medicare payment differ when comparing results using data from the Medicare Cost Report (MCR) to results using data from the audited hospital financial statement (FS). The purpose of this exploratory research is to test the assumption that MCR data yield a valid indicator of changes in hospital financial well-being.

Context: Under the Medicare post-acute-care (PAC) transfer policy, acute-care hospitals are reimbursed under a per-diem formula whenever beneficiaries are discharged from selected diagnosis-related groups (DRGs) to a skilled nursing facility, home health care, or a prospective payment system (PPS)-excluded facility. Total per-diem payments are below the full DRG payment only when the patient's length of stay (LOS) is short relative to the geometric mean LOS for the DRG; otherwise, the full DRG payment is received. This policy originally applied to 10 DRGs beginning in fiscal year 1999 and was expanded to additional DRGs in FY2004. The Secretary may include other DRGs and types of PAC settings in future expansions., Purpose: This article examines how the initial policy change affected rural and urban hospitals and investigates the likely impact of the FY2004 expansion and other possible future expansions., Methods: The authors used 1998-2001 Medicare Provider Analysis and Review (MEDPAR) data to investigate changes in hospital discharge patterns after the original policy was implemented, compute the change in Medicare revenue resulting from the payment change, and simulate the expected revenue reductions under expansions to additional DRGs and swing-bed discharges., Findings: Neither rural nor urban hospitals appear to have made a sustained change in their discharge behavior so as to limit their exposure to the transfer policy. Financial impacts from the initial policy were similar in relative terms for both types of hospitals and would be expected to be fairly similar for an expansion to additional DRGs. On average, including swing-bed discharges in the transfer policy would have a very small financial impact on small rural hospitals; only hospitals that make extensive use of swing beds after a short inpatient stay might expect large declines in total Medicare revenue., Conclusion: Rural hospitals are not disproportionately harmed by the PAC transfer policy. An expanded policy may even benefit rural hospitals by recognizing their lower use of post-acute-care and readjusting DRG weights so that they are paid more appropriately when providing the full course of inpatient care.

Managed care has been hypothesized to increase patient travel by directing patients toward network providers. The purpose of this study is to measure the effect of Medicare HMO enrollment on hospital travel time in rural areas. Hospital travel times were determined for 85,586 inpatient discharges among rural Pennsylvania residents admitted to Pennsylvania hospitals in 1998. Medicare HMO enrollees traveled up to 10.2 minutes further for acute care than Medicare fee-for-service patients (39 versus 29 minutes). Medicare HMO enrollees were 50 percent more likely to travel outside their own counties and 70 percent more likely to travel to urban areas for acute care. The distance premium associated with HMO enrollment was largest in counties with the lowest managed care penetration.

The profitability of rural small-town hospitals varies widely. Some are consistently profitable; others generate significant losses. This Policy Brief provides insights into why some rural small-town hospitals are financially successful and others struggle with persistent financial difficulties. Our analysis of Medicare cost report data reveals that financial difficulties are most likely in hospitals with fewer than 1000 admissions. Interviews with hospital administrators at selected hospitals indicate that bad debts, poor physician relations, and broad missions also may contribute to some hospitals' financial difficulties.

This report examines the use of rural and urban hospitals by rural Medicare beneficiaries. Many rural Medicare beneficiaries are treated in urban hospitals, primarily for specialized care that is not available locally. This study examines Medicare inpatient hospital discharge data for rural beneficiaries from fiscal year 1990 to fiscal year 1998. Utilization patterns by diagnosis-related group (DRG) are examined for fiscal year (FY) 1997. The percentage of rural beneficiaries treated in urban hospitals ranged from 30 percent to 36 percent during the study period. For the most frequently occurring DRGs among rural beneficiaries, which were those for routine conditions, treatment occurred predominantly in rural hospitals. The conditions most often responsible for rural beneficiaries' use of urban hospitals during this period reflected the need for coronary and other specialized surgical care. The stability of volume and case-mix throughout the study period underscores the viability of rural hospitals during a period of substantial change in the organization of health care provision.

Although the Medicare Rural Hospital Flexibility Program (MRHFP), which establishes a new designation for limited-service hospitals called critical access hospitals (CAH), intends to assist small rural hospitals having financial difficulty, it is unclear how many hospitals will qualify for the program. Potential CAHs are identified and the strategic issues that will impact actual participation in the program are discussed. Potential CAHs are identified by applying the legislative criteria for designation to a data set created from both the 1992-1995 Medicare Hospital Cost Report Information System and the 1993 and 1995 Prospective Payment System's Impact files. Descriptive analyses are used to identify potential CAHs by three parameters: distance to nearest hospital, average daily census and operating margin. Results indicate that the majority of potential CAHs have low volume and report poorer operating margins than other rural hospitals. Findings also show that the mileage requirements significantly impact the number of potential CAHs. There is more than a ninefold difference between the 93 hospitals that meet the mileage criterion and the 864 hospitals that might be eligible if certified by the state as "necessary providers," regardless of distance to the nearest hospital. The MRHFP is designed to prevent small, isolated hospitals from closing and thus to ensure continued access to care for rural residents. However, the number of potential CAHs that participate will clearly hinge on the flexibility of the program and the ability of states to determine "necessary providers."

Because the Balanced Budget Act (BBA) of 1997 requires implementation of a Medicare prospective payment system (PPS) for hospital outpatient services, the authors evaluated the potential impact of outpatient PPS on rural hospitals. Areas examined include: (1) How dependent are rural hospitals on outpatient revenue? (2) Are they more likely than urban hospitals to be vulnerable to payment reform? (3) What types of rural hospitals will be most vulnerable to reform? Using Medicare cost report data, the authors found that small size and government ownership are more common among rural than urban hospitals and are the most important determinants of vulnerability to payment reform.

Objective: To examine the response of rural hospitals to various market and organizational signals by determining the factors that influence whether or not they establish a provider-based rural health clinic (RHC) (a joint Medicare/Medicaid program)., Data Sources/study Setting: Several secondary sources for 1989-1995: the AHA Annual Survey, the PPS Minimum Data Set and a list of RHCs from HCFA, the Area Resource File, and professional associations. The analysis includes all general medical/surgical rural hospitals operating in the United States during the study period., Study Design: A longitudinal design and pooled cross-sectional data were used, with the rural hospital as the unit of analysis. Key variables were examined as sets and include measures of competitive pressures (e.g., hospital market share), physician resources, nurse practitioner/physician assistant (NP/PA) practice regulation, hospital performance pressures (e.g., operating margin), innovativeness, and institutional pressure (i.e., the cumulative force of adoption)., Principal Findings: Adoption of provider-based RHCs by rural hospitals appears to be motivated less as an adaptive response to observable economic or internal organizational signals than as a reaction to bandwagon pressures., Conclusions: Rural hospitals with limited resources may resort to imitating others because of uncertainty or a limited ability to fully evaluate strategic activities. This can result in actions or behaviors that are not consistent with policy objectives and the perceived need for policy changes. Such activity in turn could have a negative effect on some providers and some rural residents.

This article assesses the extent to which managed competition could be successful in rural areas. Using 1990 Medicare hospital patient origin data, over 8 million rural residents were found to live in areas potentially without provider choice. Almost all of these areas were served by providers who compete for other segments of their market. Restricting use of out-of-State providers would severely limit opportunities for choice. These findings suggest that most residents of rural States would receive cost benefits from a managed competition system if purchasing alliances are carefully defined, but consideration should be given to boundary issues when forming alliances.

Several previous studies of hospital utilization by nonelderly rural residents suggest that local rural hospitals have been increasingly bypassed, often for care in urban hospitals. This resulted in lost volume for rural hospitals, detracting from their financial viability. It is not clear to what extent elderly rural residents also bypass local hospitals and whether this reflects regionalization of treatment for some conditions or avoidance of local hospitals assumed to provide inadequate care. This study examines hospital use by aged rural Delaware Medicare beneficiaries living in a ZIP code area that has a local hospital during Fiscal Year (FY) 1987 (N = 670). Most of these Medicare beneficiaries were hospitalized locally. Those beneficiaries who bypassed local rural hospitals usually did so because cardiovascular surgical procedures were required and were often only performed in large urban teaching hospitals. Beneficiaries using nonlocal hospitals were similar to users of local hospitals with respect to age and sex and traveled an average of nearly 42 miles for treatment. "Bypassing" here appears to be due primarily to regional specialization of care rather than abandonment of local rural hospitals by rural residents.

Objective: To analyze whether elderly patients who are black or from poor neighborhoods receive worse hospital care than other patients, taking account of hospital effects and using validated measures of quality of care., Design: We compare quality of care provided to insured, hospitalized Medicare patients who are black or live in poor neighborhoods as compared with others, using simple and multivariable comparisons of clinically detailed measures of sickness at admission, quality, and outcomes., Setting: Two hundred ninety-seven acute care hospitals in 30 areas within five states., Patients or Other Participants: The sample includes a nationally representative sample of 9932 patients 65 years of age or older who lived at home prior to hospitalization for congestive heart failure, acute myocardial infarction, pneumonia, or stroke., Interventions: This was an observational study., Main Outcome Measures: Processes of care, length of stay, instability at discharge, discharge destination, and mortality., Results: Within rural, urban nonteaching, and urban teaching hospitals, patients who are black or from poor neighborhoods have worse processes of care and greater instability at discharge than other patients (P < .05). However, this worse quality is offset by patients who are black or from poor neighborhoods being 1.8 times more likely to receive care in urban teaching hospitals that have been shown to provide better quality of care (P < .001). Because these patients receive more of their care in better-quality hospitals, there are no overall differences in quality by race and poverty status. Death rates did not vary by race or poverty status., Conclusions: Quality of hospital care for insured Medicare patients in influenced both by the patient's race and financial characteristics and by the hospital type in which the patient receives care.

It is often necessary in health services research and strategic planning to simultaneously describe the geographic pattern of admissions to multiple hospitals. Obtaining the data necessary to accomplish this can often be problematic. In some states discharge abstract data on all admissions to all hospitals in the state are compiled and maintained by a government agency, but in 23 states these data are not available. Furthermore, problems arise when a substantial fraction of admissions cross state borders, such that data from more than one state is required for description of 'patient flows'. Individual hospitals typically maintain data on the geographic source of their own admissions, but are not likely to have access to such data regarding other hospitals in their area. Patient flow data on Medicare admissions are available for all states and are readily accessible, but heretofore it has not been known how closely the admission patterns of Medicare patients approximate those of other types of patients. We examine the accuracy of using data on Medicare admissions to estimate, at the hospital level, the admission patterns of other types of patients. Using zip code-to-hospital patient flow data for all non-federal hospitals in California, we calculated the correlation between Medicare admission patterns and those of three other groups of patients (other adults, pediatrics and obstetrics) for each hospital. For the majority of hospitals, Medicare data predict the admissions of other adults quite well, and the admissions of pediatric and obstetric admissions moderately well.(ABSTRACT TRUNCATED AT 250 WORDS)

Rural hospitals continue to face the threat of closure. Congress passed legislation in 1989 and 1990 to offer an alternative for small rural hospitals; the legislation encourages hospitals to form networks comprising an essential access community hospital (EACH) and one or more rural primary care hospitals. This legislation is a tightly focused program that will affect no more than an estimated 150 hospitals in seven states; implementation of the program has been controversial, as this DataWatch demonstrates. The authors describe the profile of rural hospitals that are likely to apply to participate in the program, based on distances between hospitals and number of beds.

Analysis of the Medicare provider analysis record (MEDPAR) data during fiscal years 1984 through 1989 indicates that the proportion of rural Medicare beneficiaries hospitalized in urban hospitals has remained constant during the prospective payment system (PPS). Much of the use of urban hospitals by rural beneficiaries during this period was to obtain specialized care or surgery, as suggested by the analysis, and is consistent with historical patterns of referral of rural patients. Thus, the bypassing of rural hospitals by rural beneficiaries for treatment in urban hospitals has probably not increased during PPS.

As part of a larger study of hospital choice, the travel patterns of more than 12,000 Medicare beneficiaries residing in three overlapping rural areas were examined. During 1986 these Medicare beneficiaries were admitted to one of 53 hospitals in an area that encompassed parts of Minnesota, North Dakota, and South Dakota. Information on ZIP code of residence, closest hospital, and hospital of admission were used to analyze hospital choices of the Medicare rural elderly residing in this area. To summarize their travel patterns, the admitting hospital was categorized based on whether it was urban or rural, its size and whether or not it was the closest facility. Findings indicated that 60 percent of these rural Medicare beneficiaries used hospital services at their closest rural hospital, regardless of its size. However, 79 percent of those whose closest hospital was larger than 75 beds used it, while only 54 percent of those whose closest rural hospital was fewer than 75 beds obtained services there. Overall, 30 percent of those residing in this rural market area went to an urban hospital. These patterns appeared to reflect an evaluation by the physician and/or individual of the relative attractiveness of the local hospital versus alternatives available, as well as the individual's characteristics. Travel patterns varied by the beneficiary's age as well as his or her relative complexity of illness, as measured by a Disease Staging methodology. Findings have implications for the provision and financing of hospital services in rural areas.

When the Health Care Financing Administration implemented the Medicare prospective payment system (PPS), the payment rates for inpatient hospital operating costs were derived on an urban and rural basis within each region. The rates were also adjusted for area wage levels and other factors affecting hospital costs. The effect of PPS on rural hospitals is of widespread interest. This article provides data on rural and urban hospital facilities, utilization, and charges, as of April 1985. Almost 48 percent of the 5,821 short stay hospitals included in the PPS recalibration file for Federal fiscal year 1984 are located in rural areas. Rural and urban areas are designated by the Executive Office of Management and Budget or, in some instances by regulation.