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Why rural Colorado hospitals are getting hit hard before coronavirus patients even arrive

Why rural Colorado hospitals are getting hit hard before coronavirus patients even arrive
Posted at 5:40 PM, Mar 31, 2020

HUGO, Colo. — The only hospital along Interstate 70 between the Denver metro area and Burlington, near the Kansas border, sits in the tiny town of Hugo, in Lincoln County.

"If you get hurt on I-70 and we're not here, it's 80 miles to the nearest hospital," Lincoln Community Hospital CEO Kevin Stansbury said.

While known coronavirus cases have been few and far between on the Colorado's eastern plains, Lincoln Community is already feeling a major impact from the outbreak — before seeing even a single coronavirus patient.

Since shutting down elective surgeries this month, the 15-bed hospital has seen about a 70% reduction in revenue, Stansbury said.

"It just dropped off like it was falling off a cliff," Stansbury said.

That kind of impact is likely being felt by many rural hospitals across the state, even before coronavirus cases surge in their communities, according to the Colorado Hospital Association.

"This is definitely a concern for us that we are watching very closely," said Cara Welch, director of communications for the hospital association.

Gov. Jared Polis suspended elective surgeries on March 19, an effort to preserve hospital capacity and crucial personal protective equipment. The order exempted critical access hospitals, such as Lincoln Community, facilities that are designed to provide essential services in rural communities.

Lincoln Community also operates a therapy/opthalmologist clinic and family practice clinic in Limon, a family practice clinic in Flagler, a 10-bed assisted-living home in Hugo and a mobile health clinic, which travels to towns such as Deer Trail, Byers, Bennett and Simla.

Only one coronavirus case has been identified in Lincoln County, but "we need to be responsible as well," Stansbury said, so the hospital put elective procedures and services on hold to preserve personal protective equipment and limit potential coronavirus exposure. About 80% of the hospital's revenue comes from elective outpatient surgeries, clinic services and diagnostics.

"It's been a real struggle for us," Stansbury said.

Lincoln Community has about 30 days of funding on hand, Stansbury said. The hospital should receive a boost in funds through the federal stimulus bill passed last week, to cover lost Medicare and Medicaid revenue.

But many rural hospitals in Colorado were already operating on negative margins, according to the state hospital association, and others were below the national benchmark of a 4% margin. Last year, 46% of rural hospitals across the country were operating at a loss, according to the National Rural Health Association.

"If we're not able to address the short-term cash needs of rural hospitals, we're going to see hundreds of rural hospitals close before this crisis ends," Alan Morgan, CEO of the NRHA, told NPR earlier this month . "This is not hyperbole."

In Colorado, elective procedures are "an important source of revenue for hospitals that is now missing," Welch said.

Hospitals are also bracing for an uptick in patients — and an expected demand for more staffing — when their capacities were limited to begin with.

In rural southwestern Colorado, about 30-40 coronavirus tests were being administered on Tuesday in Pagosa Springs in Archuleta County. The only hospital in the county, the Pagosa Springs Medical Center, has 11 licensed beds. Before Tuesday, one coronavirus case had been identified in the county, but health officials expect the actual number of cases is higher .

"The combination of that lost revenue and increased spending has been incredibly difficult for a number of hospitals," Welch said.