The COVID-19 pandemic nearly buried Michigan’s rural hospitals. Grand funding is helping to pull them out.
CHARLOTTE, Mich.—For years, rural hospitals in Michigan have been fighting an uphill battle to stay afloat in a growing healthcare field. But when the coronavirus pandemic began, the battle became that much more difficult.
“When we first went into this, a lot of our hospitals here in Michigan were looking to what was going on in New York, and we were hearing from our colleagues in New York that almost a third of their staff was getting sick,” said Helen Johnson, president of Sparrow Eaton Hospital. “So, not only you had this convergence of tons and tons of sick patients. But then some of those patients were also the people that you needed to take care of those patients.”
Hospitals incurred staffing shortages, costs from personal protective equipment accumulated, and health system money makers like elective treatment facilities were, at least temporarily shuttered. The combination made dire circumstances even worse for many hospitals.
“These grants that are coming from the USDA grants and from the government are really going to help us, you know, help build back into the future a little bit,” Johnson said.
A Timely Grant for Michigan Hospitals
Michigan Gov. Gretchen Whitmer announced in August that the state had secured a grant from the Health Resources and Services Administration that would provide more than $13 million for 51 small, rural hospitals in Michigan.
“Our top priority is supporting the brave professionals on the frontlines of our health care industry in every corner of our state to ensure that they have what they need to protect themselves, their family, and their neighbors,” Whitmer said upon announcing the grants. “This funding will help rural hospitals continue serving their communities by expanding their COVID-19 testing capacity and mitigation efforts. I want to thank the nurses, doctors, and all medical professionals who continue to go above and beyond to keep people safe each and every day.”
Rural hospitals with fewer than 50 beds will be able to use the funds for testing equipment, personnel, temporary structures, or education, according to the governor’s office. Mitigation strategies are required to be part of the CDC community mitigation framework, including education, contact tracing, communication, and outreach.
Each hospital will receive about $257,000, which must be used within 18 months of receipt.
A Big Help for Small Hospitals
Sparrow’s Eaton Hospital, which is certified for 25 beds, falls under the category of small, rural hospitals. It was one of many Michigan hospitals that at points of the COVID-19 pandemic reached full capacity, as the number of COVID-19 patients overwhelmed hospitals and required the medical facilities to use an abundance of personal protective equipment.
Johnson said the grants will help hospitals in many ways, including fiscally. Essential equipment, including personal protective equipment such as masks, gowns, and face shields, saw their prices skyrocket during the pandemic, Johnson said. Taking into account that many hospitals used about five times as much PPE as per usual, the costs added up quickly.
Another hit for smaller hospitals? The shutdown of some of their facilities that house elective treatments and procedures.
“We actually are built to make some money on surgeries and things like that,” Johnson said. “There’s usually a couple of lines that actually carry your margin, and the rest of it you provide at a loss. So, to be able to bring those services back on, and for the government to recognize all of the financial losses that these hospitals had, is huge.”
A Longstanding Concern
Instability for small, rural hospitals isn’t unfamiliar. It’s been an issue for years, according to Johnson. Prior to the pandemic, the Center for Healthcare Quality and Payment Reform released a report indicating that more than 900—over 40%—rural hospitals around the nation were either at immediate or high risk of closing.
More than 110 rural hospitals have closed in the US since 2013, and that concern isn’t unfounded in Michigan. Both nationally and statewide, the pandemic has exacerbated things.
“It was due to finances, it was due to, you know, crumbling infrastructure,” Johnson said.
“Many of our community hospitals, small community hospitals, are very vulnerable,” she said. “Over the last 10 years, many hospitals have merged with larger systems, specifically for that reason, because you know it’s very challenging to try and do all the things that you need to do to run a hospital, whether it’s an electronic health record or recruiting physicians, access to capital.
And the concerns are real, Johnson says, noting that in many communities, rural hospitals are sometimes the largest employers. More importantly, they often serve as the only medical provider for large areas, meaning they serve an important role in keeping people safe.
“I really appreciate the legislature that had the foresight to invest in rural healthcare and definitely want to thank them for that because $250,000 for some of our smaller community hospitals can be your entire margin for a year or more,” she said. “So, for some people, this has really been a lifeline.”