Economic impact of the critical access hospital program on Kentucky's communities

Context: In 1997, the Medicare Rural Hospital Flexibility Grant Program created the Critical Access Hospital (CAH) Program as a response to the financial distress of rural hospitals. It was believed that this program would reduce the rate of rural hospital closures and improve access to health care services in rural communities. Objective: The objective of this paper is to analyze the economic impact of the CAH Program on Kentucky's communities. Methods: Both an economic input-output model and a quasi-experimental control group method are used in this research paper. While the analysis using the input-output model uses data from the year 2006, the analysis using the quasi-experimental control group method uses data from 1989 to 2006. Conclusion: The results indicate that the rural counties where a CAH was adopted did appear to benefit in economic terms relative to those that did not have a CAH.