News: Less than half of U.S. rural hospitals still offer labor and delivery services, report shows

Maternity care in rural communities continues to face a deepening financial and operational crisis, according to a new report published by the Center for Healthcare Quality and Payment Reform (CHQPR).

The report detailed the human cost of declining payments by private insurers to rural hospitals. For instance, according to the authors of the report, “[m]ore than 130 rural hospitals that are still delivering babies lost money overall in both of the two most recent years, and they could be forced to close labor and delivery services in order to survive. In 11 states, at least one-fourth of the rural maternity care hospitals are in this situation.”

The problem stems from two interrelated factors: (1) rural hospitals are unable to recruit and retain the appropriate level of staff necessary for the delivery of adequate maternity care, because (2) health insurance plans—i.e., private insurers—do not reimburse rural hospitals for their services in full.

With respect to the second of these factors, the report is clear to distinguish that the problem is “not low Medicaid or Medicare payments or losses on uninsured patients.” Rather, the “biggest problem” is “private insurance companies”—e.g., Medicare Advantage and commercial health insurance—"paying rural hospitals less than what it costs to deliver services to patients."

To remedy the situation facing maternity centers at rural hospitals, the authors of the report suggest a four-fold set of policy recommendations under the following headings:

• Help rural communities attract and maintain a maternity care workforce
• Require adequate payments from private and public payers for other rural healthcare services
• Pay adequately for maternity care services
• Create standby capacity payments to support the fixed costs of maternity care

Editor’s note: To read the CHQPR report, click here.