Jan 26, 2024 3 min read

By Jeff Kotula

At one time, Washington County had three independent health systems – Washington Health System, Canonsburg General Hospital, and Mon Valley Hospital – all of which provided quality health care to our largely rural community.

However, over the past two decades, the health care environment changed dramatically and as it transformed, so did the long-term viability of these independent providers, causing them to seek stronger partners. Allegheny Health Network came first, with the acquisition of Canonsburg General Hospital and more recently, the Mon Valley Hospital merged with Penn Highlands Healthcare to create Penn Highlands Mon Valley. Washington Health System now proposes an affiliation with UPMC, which will secure health care services for Washington County residents for years to come and even as our population demographics continue to skew older.

The United States Government Accountability Office (GAO) reports nearly one-fifth of the nation’s population lives in a rural area. According to the report, this population – like many in Washington County’s rural areas – are older and have generally worse health conditions, less access to health services, and rely on Medicare and Medicaid for health coverage. In addition, many lack the necessary access to high-speed internet service, limiting the viability of telehealth services even if they are becoming more common. It is unrealistic to assume that what works for major metropolitan areas will also be a solution for communities like Washington County.

Many of the factors GAO mentions also create challenges for rural health care providers. Reimbursement rates for Medicare and Medicaid have not kept up with inflation, declining 26% as the cost to run a practice has increased 47%, according to the American Medical Association. This misalignment was only exacerbated by pandemic-induced inflation. Washington Health System’s own data shows that 60% of their patients rely on Medicare and Medicaid for health insurance, which created a serious strain on their budget and an unsustainable burn rate on available cash reserves.

To resolve these health care challenges in our rural counties, there are two potential solutions. The first is for rural hospitals to seek partnerships with a larger health system to maintain or even increase health care service levels by spreading out the insurance payer mix and other cost-saving measures. This is the solution that Washington Health System is proposing.

The second potential solution is to begin to cut low-margin services, such as obstetrics and maternity care, enact other cost-saving measures, and potentially close the hospital if these trends continue long-term. While this is a rather simplistic view, it matches the simple reality facing many rural health systems – either merge or close.

Although losing Washington Health System’s 127-year legacy as the last independent health system in our county is not the ideal outcome, partnering with the respected UPMC and guaranteeing that high quality health care services remain available to our residents is the best possible outcome. The unimaginable alternative is Washington Health System continuing to lose money, cutting vital health services, and withering into closure.

With UPMC’s agreement to maintain the services at Washington Health System’s facilities for at least the next 10 years and their pledge of $300 million in capital improvements during that same time frame, this merger is in the best and future interests of the residents and businesses of Washington County.

Jeff Kotula is the president of the Washington County Chamber of Commerce.