Hospital choice of Medicare beneficiaries in a rural market: why not the closest?

As part of a larger study of hospital choice, the travel patterns of more than 12,000 Medicare beneficiaries residing in three overlapping rural areas were examined. During 1986 these Medicare beneficiaries were admitted to one of 53 hospitals in an area that encompassed parts of Minnesota, North Dakota, and South Dakota. Information on ZIP code of residence, closest hospital, and hospital of admission were used to analyze hospital choices of the Medicare rural elderly residing in this area. To summarize their travel patterns, the admitting hospital was categorized based on whether it was urban or rural, its size and whether or not it was the closest facility. Findings indicated that 60 percent of these rural Medicare beneficiaries used hospital services at their closest rural hospital, regardless of its size. However, 79 percent of those whose closest hospital was larger than 75 beds used it, while only 54 percent of those whose closest rural hospital was fewer than 75 beds obtained services there. Overall, 30 percent of those residing in this rural market area went to an urban hospital. These patterns appeared to reflect an evaluation by the physician and/or individual of the relative attractiveness of the local hospital versus alternatives available, as well as the individual's characteristics. Travel patterns varied by the beneficiary's age as well as his or her relative complexity of illness, as measured by a Disease Staging methodology. Findings have implications for the provision and financing of hospital services in rural areas.