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Insight Now: January 26, 2011 Archive

An Online Forum: Virginia, rural health care and public hospitals

Posted at 12:21 PM on January 26, 2011 by Michael Caputo

On January 28th we opened up our webspace for an hour to talk about the challenges facing rural health care. We focued on one publicly-owned hospital's difficulty in keeping financially afloat - Virginia Regional Medical Center.

This discussion started by looking at what it might mean for VRMC to lose its independence by selling to a larger health system.The second part of our conversation looked at the broader financial pressures for health care in rural Minnesota. More specifically low reimbursement rates from federal programs like Medicare and Medicaid.

Read this conversation. For more background, click here.


We know that changes to Minnesota's General Assistance Medical Care program hit health providers in greater Minnesota especially hard.

And that's pressing down on hospitals in more rural settings. Places like Paynesville and Arcadia, Wisconsin (just east of the Minnesota border).

Then there is the city-owned hospital in Virginia. The Virginia Regional Medical Center lost $2.4 million in 2010 and another $1 million between 2008 and 2009. Leaders there are studying the possibility of merging with another facility or being sold. They also have had a tough time attracting qualified doctors to work there.

Dr. Wendell Smith, a surgeon in the region who also sits on the Virginia Regional Medical Center commission, told MPR News last year that VRMC gets about two-thirds of its revenue from government programs - Medicare and Medicaid. So "in small hospitals, such as Virginia ... we get paid less from the government for what we do than what it costs."

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