Hospital sales and buyouts are changing the face of health care in communities across the country with mergers escalating to levels not seen in more than a decade. Small rural hospitals are common acquisition targets for several reasons, including value-based purchasing, market share and cost control, and the strategies promoted by the ACA.

The proposed research will help inform rural health policy by: 1) determining how M&As of small rural hospitals affect access to care for Medicare beneficiaries, and 2) estimating the potential financial consequences of M&As to small rural hospitals, including their long term financial viability. Differences between the markets of recently acquired hospitals and other rural hospitals and the post-acquisition change in services and financial performance of these hospitals will be investigated. Understanding the effects of M&As is key to informing policies regarding merger oversight, Medicare reimbursement of rural hospitals, and implementation of health care reform.

Data sources will include the hospital market service area file, the OSCAR provider of services file, the healthcare cost report information system, the area resource file, census data, the AHA Annual Survey of Hospitals, and Irving Levin Associates. Products will include a Policy Brief and an article for submission to a peer-reviewed journal.

Publications

• Rural Hospital Mergers and Acquisitions: Who Is Being Acquired and What Happens Afterward?
  Policy Brief
  North Carolina Rural Health Research and Policy Analysis Center
  Date: 08/2014
  A brief from the North Carolina Rural Health Research and Policy Analysis Center examines the implications of mergers and acquisitions for small rural hospitals. The brief addresses the characteristics of rural hospitals that merged and the changes in hospital financial performance, staffing, or services following a merger.