How Rural Hospital Closures Affect Rural Residents

Deepak Premkumar, Dave Jones, and Peter F. Orazem

from ARE Update Vol. 20, No. 4, Mar/Apr, 2017

View Full Article PDF: How Rural Hospital Closures Affect Rural Residents

Abstract

This study estimates a model of rural patient hospital choice between the nearest rural, urban, or research hospital. We present separate estimates for inpatient and outpatient visits, for different diagnoses, and for emergency and nonemergency admissions. The analyses illustrate the tradeoffs between hospital quality and distance in deciding whether to choose the nearest hospital or to travel farther for an alternative. We
then simulate two hospital closing scenarios. We find that closing the lowest-quality rural hospitals is a better policy prescription than closing the least used hospitals since closing low-quality hospitals results in a substantial increase in average quality of hospital with only a slight increase in distance traveled for chosen hospitals.

Keywords

hospital choice, hospital closing, bypass, hospital quality, distance, rural

Citation

Deepak Premkumar, Dave Jones, and Peter F. Orazem. "How Rural Hospital Closures Affect Rural Residents." ARE Update 20(4)(2017):5-8. University of California Giannini Foundation of Agricultural Economics.
https://giannini.ucop.edu/publications/are-update/issues/2017/20/4/how-rural-hospital-closures-affect-rural-residents/