Title: Concerns Grow for Rural Hospitals in North Carolina
By Local News Team
FirstHealth of the Carolinas is showcasing how smaller, rural hospital networks can excel in patient care. Based in the Sandhills region, FirstHealth operates four hospitals and nearly 100 clinics across 13 counties in North Carolina and two in South Carolina. Over the years, it has earned multiple awards for quality care and patient satisfaction, consistently ranking in the top tier nationwide for the past 18 years and appearing on Fortune’s list of Top 100 hospitals several times.
However, leaders at FirstHealth have raised alarms about the future. During a recent meeting with state lawmakers, Amy Graham, Chief Strategy Officer, and Autumn McFann, Chief Financial Officer, shared troubling insights about the financial viability of rural hospitals.
“Almost half of rural hospitals in the U.S. are operating at a loss, which is not a sustainable model,” McFann said. Like many rural healthcare systems, FirstHealth heavily relies on government health programs such as Medicare and Medicaid, which account for over 75% of their patient base. These programs often pay less than traditional insurance.
“If we continue like this, our operating margins—which are already thin at about 3%—might shrink further,” McFann warned. Projections indicate that by 2032, FirstHealth may face significant financial challenges due to cuts anticipated from the federal One Big Beautiful Bill Act, which could reduce Medicaid funding significantly.
The impacts could be severe, affecting essential services such as obstetrics, cancer care, and emergency services.
Nursing Shortage Worsening
The situation could worsen as North Carolina is projecting a shortfall of at least 12,500 nurses by 2033, alongside a shortage of doctors in rural areas. FirstHealth struggles to recruit healthcare professionals due to limited educational opportunities, despite efforts made by the General Assembly to funnel more funding into healthcare training.
During the same meeting, Katherine Restrepo Martin, Vice President for Health Affairs at the University of North Carolina System, updated lawmakers on initiatives for nursing education. In the 2023 state budget, $40 million was allocated to expand healthcare programs, with $29 million already distributed among nursing schools to help them graduate more students.
“Interest in nursing is high, but we don’t have enough faculty or classroom space,” Martin remarked. Many qualified candidates are turned away from nursing programs due to capacity constraints.
Financial limitations are a major obstacle for nursing faculty, whose salaries often don’t match what they could earn in hospitals. Additionally, students face challenges like financial burdens and personal issues, which can hinder their academic progress.
One positive development is that UNC Greensboro plans to increase its nursing enrollment significantly by allowing students to begin nursing courses earlier in their academic journey.
Concerns About Workforce and Physician Recruitment
McFann emphasized that staffing remains a top issue; FirstHealth currently has 243 vacancies among its 1,544 registered nurse positions. This shortage compels the system to rely on costly contract labor, exacerbating financial challenges.
Meanwhile, recruiting doctors for rural regions presents an even greater hurdle. The majority of North Carolina physicians are concentrated in urban centers, leaving many rural counties without adequate primary care. A study indicated that many residents are trained in urban areas, leading to fewer inclined to practice in the countryside.
To address this gap, the General Assembly created a fund for rural residency programs, offering grants to help hospitals develop more training opportunities in specialties that are critically needed in rural areas.
As lawmakers consider these pressing issues, McFann told them, “Decisions you make today will influence whether rural hospitals survive and whether our communities thrive.”
The focus now is on stabilizing rural healthcare systems to ensure that they can provide the quality of care residents depend on for years to come.
