From scientific breakthroughs and emerging diseases to payment reform and new technologies, healthcare is always evolving. Hospitals across a variety of settings share many of the same challenges keeping up with these changes and managing ongoing demands. However, the way these issues affect rural hospitals can differ significantly given the unique needs and characteristics of these organizations and the communities they serve.

Here are some of the top issues rural hospitals are currently dealing with:

Strengthening financials

Achieving financial stability and maintaining independence are ongoing sources of pressure for many healthcare organizations and especially for rural hospitals. Recent research indicates that nearly half are operating at a loss and 432 are at risk of closure.

Furthermore, the recent decrease in the physician fee schedule conversion factor for Medicare will result in an average payment reduction of 2.93% for physicians and other clinicians in 2025. Given that rural hospitals often serve a higher proportion of Medicare beneficiaries, even a small reduction in payments can have a noticeable impact.

As rural healthcare organizations plan for the future, the cloud offers several benefits worth considering. With a cloud-native system like Paragon® Denali, organizations can reduce their hardware footprint and scale the system as needed to ensure they get the value they deserve without incurring unnecessary costs. Additionally, by reducing downtime, the cloud can help prevent disruptions to patient care—and in turn, reimbursement.

Rightsizing staffing

Staffing shortages remain common across the industry, and rural hospitals often face more significant hiring challenges than their urban and suburban counterparts, such as attracting specialists to communities where there may be fewer resources to work with. Patients in rural settings also often rely on the emergency department (ED) if other healthcare facilities are dozens, if not hundreds, of miles away. In 2024, however, approximately one-fifth of emergency medicine residency programs were not filled.

While approximately 20% of U.S. residents live in rural areas, less than 10% of physicians practice in these settings. Given the widespread staffing shortages, community hospitals are competing with large health systems to tap into the talent pool. This may mean a heavier reliance on hiring contractors to fill staffing gaps, which typically are more costly to organizations, further compounding budgetary constraints.

Rural healthcare organizations must find creative ways to fill staffing gaps to not only ensure patients get the care they need, but to also support short-staffed clinical teams as best as possible. Artificial intelligence (AI) solutions that offload administrative tasks from providers, such as ambient listening AI, can help. For example, Paragon Denali is now integrated with Nabla’s ambient AI assistant, which can save providers two hours of clinical note authoring time on average. By getting this time back, providers in rural areas can see more patients more quickly, helping to close some of the gaps in care stemming from staffing shortages.

Maintaining and securing systems

Financial burdens and staffing hurdles are intertwined with a third challenge rural organizations are contending with: technology management. Organizations want to get the most out of their health IT, but it is difficult to maintain and upgrade complex systems when your IT staff members are spread thin. Additionally, rural hospitals are able to send, receive, find and integrate data to/from outside sources at lower rates on average (48% versus 62% among all hospital types), adding to the load of clinical and non-clinical staff. And, rural hospitals often struggle to hire cybersecurity professionals, which makes it more difficult to protect against, monitor for and respond to security incidents.

There are additional strategies rural hospitals can choose to mitigate cybersecurity and broader IT challenges. Opting for an electronic health record (EHR) system that is designed with industry standards in mind and that simplifies data management can help, as well as implementing a system that integrates ambulatory and acute records. Additionally, leveraging a cloud-native EHR can offload network and infrastructure responsibilities while giving under-resourced organizations more affordable access to advanced security controls and enabling internal IT staff members to focus more on daily tasks.

Making impactful IT investments

The closure of any hospital has ripple effects across its community, and these can be particularly pronounced in rural regions where access to care may already be limited. Altera Digital Health is attuned to the nuances of healthcare delivery at rural hospitals, and this understanding has informed the ongoing advancement of our solutions and services. Learn how Paragon Denali can help your rural organization navigate the top clinical, financial and operational challenges here.