SACRAMENTO (April 18, 2024) — Nearly 2 million people live in California’s rural communities, while many millions more visit these areas for relaxation and exploration. Yet, the lifesaving and life-changing hospital care residents and visitors alike count on is at risk of being lost.
California’s smallest rural hospitals — the 37 critical access hospitals with fewer than 25 beds that serve communities at least 35 miles from another medical facility — are facing their gravest challenge in decades. They are losing money every day caring for patients. Nearly two-thirds of these hospitals are operating at a severe loss — with their operating margins dropping a frightening 8 percentage points from 2019 to 2023.
Senate Bill (SB) 1423 (Dahle, R-Bieber), which will be considered on April 24 by the Senate Health Committee, would help stabilize these vital, at-risk hospitals by creating a new financial model designed to cover the cost of providing services to Medi-Cal patients. SB 1423 would help ensure all Californians have access to the care they need and deserve.
“Health care that keeps families whole and healthy should be accessible to all — not just those living in urban or suburban areas with access to multiple providers,” said Carmela Coyle, President & CEO of the California Hospital Association. “Rural and critical access hospitals are not only the backbone of care in isolated, underserved areas throughout the state, they are also essential partners in the state’s broader health care delivery system. Without these hospitals, providers in more populated areas would struggle to meet all the health care needs of patients from more remote communities.”
The challenges facing rural and critical access hospitals are a national problem. Between January 2013 and February 2020, more than 100 rural hospitals across the country closed — including Corcoran District Hospital and Madera Community Hospital, both in California’s Central Valley. When a rural hospital closes, those in poor health, seniors, and people experiencing poverty suffer the most (nationally, 13% of people living in an area affected by a closure are below the poverty line, compared to 9% overall). For Medicare beneficiaries, a closure means the travel distance to access inpatient services increases by 20 miles; for specialized services, like treatment for substance use disorders, it increases by almost 40 miles.
In those rural communities where hospitals currently remain open, health care services are dwindling. Since 2011, one-fifth of California’s rural hospitals have had to close or reduce maternity care, and 40% have stopped providing cancer services so they can continue providing 24/7 emergency care for all. “Even in this difficult budget year, California lawmakers have a responsibility to ensure that our state’s most remote communities continue to have access to vital health care services,” Coyle said. “SB 1423 is urgently needed to protect California’s most vulnerable residents.”
