Defining rural hospital markets

Area of Science:

• Health Services Research
• Rural Health Policy
• Geographic Health Analysis

Background:

• Accurate definition of rural hospital market areas is essential for understanding patient access and identifying populations vulnerable to hospital closures.
• Traditional county-based market definitions may not accurately reflect the actual service areas of rural hospitals.
• Understanding geographic scope is vital for effective health policy and resource allocation in rural areas.

Purpose of the Study:

• To examine the geographic scope of rural hospital markets.
• To compare hospital-specific market areas with county-based market areas.
• To explore the impact of market area definition on health services research, particularly in modeling rural hospital closure.

Main Methods:

• Utilized 1988 Medicare patient discharge records (MedPAR) and hospital financial information (HCRIS) for rural hospitals.
• Defined hospital-specific market areas using zip codes of patient origin, aggregating data to the market level.
• Compared hospital-specific market areas to county-based areas using geographic, socioeconomic, and market competitiveness indicators; estimated a rural hospital closure model.

Main Results:

• County-based market areas inaccurately include non-service areas and exclude actual patient origins.
• Empirical modeling demonstrated that defining hospital market areas does not impede the identification of major risk factors for rural hospital closure.
• Zip code-based market definitions provide a more precise representation of rural hospital service areas.

Conclusions:

• Market area definition is critical for identifying and monitoring populations at risk from rural hospital downsizing or closure.
• Further research on the market areas of closed rural hospitals is needed to develop more relevant definitions of at-risk populations.
• Accurate market area delineation supports targeted interventions and policy development for rural healthcare sustainability.