Higher health insurance deductibles are causing the amount of and debt at hospitals to pile up, but the problem is becoming especially difficult for rural hospitals, according to a published report. The issue for rural hospitals is two fold: one, people living in rural areas tend to have insurance policies with higher deductibles, leaving them with more bills that are owed by patients, and rural hospitals often end up at the back of the line when insurance companies are covering patient treatments.
In many instances, patients who are treated — and stabilized — at a rural hospital are then transferred to a different facility that can more easily care for them. When the insurance claims are submitted for both facilities, the rural facility – which saw and treated the patient first – is where the deductible is applied. And if a patient is not able to pay for the deductible, the rural facility is left to collect on the unpaid debt while the larger facility is fully compensated by the insurance carrier.
In Colorado, according to the report, the average deductible in 2017 was $5,800, which is an amount that 25% of people living in the state would not be able to afford.
Making matters worse for rural hospitals is that the wages earned by individuals living in those areas is lower than those living in urban areas, living people in rural areas with less money to pay off their debts.
The amount of bad debt at rural hospitals has doubled since the enactment of the Affordable Care Act, according to the report, which cites a statistic from the National Rural Health Association. This has led to the closure of 120 rural hospitals in the past 10 years.
Rural hospitals want to shift the burden of collecting unpaid debts to the insurance companies because the hospitals do not have the expertise to handle it properly.
