Risk of Closure Among Independent and Multihospital-Affiliated Rural Hospitals

Question Is affiliation with another hospital or multihospital system associated with lower risk of closure in rural areas? Findings In this 13-year cohort study from 2007 to 2019 among rural US hospitals that faced financial distress in 2007, affiliation was associated with a lower risk of closure compared with being independent. Conversely, among hospitals with financial stability in 2007, affiliation was associated with a higher risk of closure compared with being independent. Meaning The study results suggest that affiliation may protect some financially distressed rural hospitals from closure, but the higher risk of closure among hospitals that were initially financially stable potentially raises concerns about the consequences of affiliation for some types of hospitals. Importance The increase in rural hospital closures has strained access to inpatient care in rural communities. It is important to understand the association between hospital system affiliation and access to care in these communities to inform policy on this issue. Objective To examine the association between affiliation and rural hospital closure. Design, Setting, and Participants This cohort study used survival models with a time-dependent variable for affiliation vs independent status to assess risk of closure among a national cohort of US rural hospitals from January 2007 through December 2019. Data analysis was conducted from March to October 2021. Hospital affiliations were identified from the American Hospital Association Annual Survey and Irving Levin Associates and closures from the University of North Carolina Sheps Center (Chapel Hill). Additional covariates came from the Healthcare Cost and Utilization Project State Inpatient Databases and other national sources. Exposures Affiliation with another hospital or multihospital health system. Main Outcomes and Measures Closure was the main outcome. The models included hospital, market, and utilization characteristics and were stratified by financial distress in 2007. Results Among 2237 rural hospitals operating in 2007, 140 (6.3%) had closed by 2019. The proportion of rural hospitals that were independent decreased from 68.9% in 2007 to 47.0% in 2019; the proportion that were affiliated increased from 31.1% to 46.7%. Among financially distressed hospitals in 2007, affiliation was associated with lower risk of closure compared with being independent (adjusted hazard ratio [aHR], 0.49; 95% CI, 0.26-0.92). Conversely, among hospitals that were financially stable in 2007, affiliation was associated with higher risk of closure compared with being independent (aHR, 2.36; 95% CI, 1.20-4.62). For-profit ownership was also strongly associated with closure for hospitals that were financially stable in 2007 (aHR, 4.08; 95% CI, 1.86-8.97). Conclusions and Relevance The results of this cohort study suggest that affiliations may be associated with lower risk of closure for some rural hospitals in financial distress. However, among initially financially stable hospitals, an increased risk of closure for hospitals associated with affiliation and proprietary ownership raises concerns about the association of affiliation with closures in some circumstances. Policy interventions to stabilize inpatient care in rural areas should account for these findings. This cohort study examines thhe association between affiliation and rural hospital closure.