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Rural Health Information Hub
Rural Health Information Hub

Community Vitality and Rural Healthcare

In rural communities, healthcare and the overall vitality of the community are intrinsically linked. A robust and economically vibrant community supports and sustains quality health and social services for its residents by attracting and retaining well-trained and committed healthcare professionals. Additionally, communities with strong economies may offer a variety of other benefits for their local healthcare system through greater availability of infrastructure investment and philanthropic giving, facilitation of partnerships between healthcare systems and other organizations, and presence of a balanced payer mix for healthcare services, among other factors. In return, a high-quality healthcare system can support economic and community development initiatives. Together, strong rural economies and rural healthcare systems can address the five domains of the Social Determinants of Health: economic stability, education, health and healthcare access, the built environment, and social cohesion.

This topic guide focuses on how community and economic development can complement health services in rural areas, how rural communities can identify and build on their unique assets, and how collaboration between various sectors can address challenges, including issues related to population health and public health.

Frequently Asked Questions

What is community resilience and how does it affect the health of rural populations?

Community resilience is the capacity to prepare for, endure, and adapt to or recover from a natural disaster or unexpected economic change based on a community's unique population needs, assets, location, and economic dynamics. Economic Resilience and Vulnerability in the Rural West, a 2015 working paper from the University of Arizona Department of Agricultural and Resource Economics, presents a system for determining economic resilience and vulnerability in rural counties by assessing variables including distance from metropolitan areas, percent of public lands in rural counties, education, health, and economic diversity. The study found that access to healthcare is a significant factor for rural resilience, as is environmental quality.

The 2018 research report Exploring Strategies to Improve Health and Equity in Rural Communities from the NORC Walsh Center for Rural Health Analysis notes that relationships between individuals and institutions across economic and service sectors contribute to rural community resilience. These relationships can strengthen communities that face challenges related to community well-being, access to services, and economic development. Community-driven partnerships also impact the health status of rural communities, as they contribute to improvements in physical infrastructure such as drinking water and wastewater facilities and investments in public parks. They also generate support for local healthcare facilities.

As the NORC Walsh Center report notes, a number of studies, articles, and mainstream depictions of rural America focus on problems, needs, or deficiencies in resources, talent, industry, and health. While these are significant issues that affect resilience and deserve attention, solely concentrating on problems and needs creates a narrative that does not inspire growth. According to the authors of the report, “While it is important to acknowledge and address these inequities and their root causes, it is essential to understand and leverage the strengths and assets of rural places that serve as protective factors and could fundamentally improve health and equity.” The report emphasizes that the strong relationships that shape rural communities are among their most valuable assets, also noting that many rural areas possess significant natural, cultural, and historical features that can contribute to economic partnerships and resilience.

For an example of a region-specific overview of rural economic resilience, see the Appalachian Regional Commission's 2019 report Strengthening Economic Resilience in Appalachia, which includes a series of best practices for rural community development and case studies.

The Rural Emergency Preparedness and Response topic guide provides information and resources which support emergency planning, response, and recovery. For organizations seeking a step-by-step approach, a related toolkit provides practical guidance, case studies, and more.

How do healthcare services, facilities, and providers contribute to the economic vitality of rural communities?

Providing quality healthcare in a rural community goes beyond immediate healthcare services; it also has a positive impact on the economic health of a community. According to a 2022 report from the American Hospital Association, rural hospitals and healthcare systems support $220 billion in economic activity in rural areas, including 1 in 12 rural jobs. Hospitals offer some of the best paying jobs available in rural areas, bringing professionals in to live and invest in the community. This perspective piece from the National Rural Health Association outlines the impacts of rural hospitals on economic activity and growth.

Physicians working in a rural community have both a direct and indirect impact on revenue and employment in healthcare and other sectors in their communities. A 2018 report, The National Economic Impact of Physicians, offers state-level data on the economic impact of patient care physicians, although it does not represent rural economic impact specifically. A 2016 report from the National Center for Rural Health Works (NCRHW) estimates that a rural primary care physician can generate more than $1.4 million in wages, salaries, and benefits and 26.3 jobs in a local community with a hospital.

A variety of research describes other impacts of local healthcare services on the economy:

  • A 2017 USDA study found that inpatient healthcare facilities were responsible for 1.25 million jobs, or 8.5% of wage and salary employment in rural communities at their peak in 2011.
  • As detailed in a 2014 presentation, the Rural Wisconsin Health Cooperative (RWHC) found that when a local hospital offers key services, people stay in the community for care instead of traveling to urban centers and investing there. Moreover, rural health insurance premiums and taxes only come back to the community and create jobs if there are local healthcare providers offering services in the community.
  • A 2022 analysis by the Center for Economic Analysis of Rural Health (CEARH) studied the impact of reductions in rural hospital employment on other industries. For each hospital job eliminated, an estimated 0.11 jobs were lost because of a reduction in hospital spending and an additional 0.3 jobs were lost because of reduced hospital employee spending. The analysis identifies the industries most impacted by hospital closures, which include restaurants, higher education, industrial machinery and equipment repair, religious organizations, professional services, and more.

How can the availability of healthcare services be leveraged in economic and community development efforts?

Healthcare services not only generate employment and labor income in the local economy, they also contribute significantly to attracting and retaining business and industry. As remote work and web-based employment become more prevalent, access to healthcare is an important consideration for workers to continue to live in or relocate to rural areas.

Site selection efforts for large corporate projects most often require prospective communities to provide information on the availability of local healthcare services. An engaged local hospital with high quality, low cost healthcare services can help in a community's response to these competitive proposals. Additionally, a 2017 Wisconsin Hospital Association case study illustrates how the availability of local healthcare allows employers and healthcare providers to promote preventive care in an effort to retain their workforce, to minimize absenteeism and work disruptions, and to control healthcare costs.

Data has demonstrated that retirees can substantially impact the local economy, and retirees are more likely to move to or stay in rural communities with quality healthcare facilities. For example, the 2018 report Evaluating Retiree-Based Economic Development in Georgia: Golden Rules shows that bringing retirees into a community grows and diversifies the local economy, with 55 jobs generated for every 100 new retirees in rural Georgia.

Rural community and economic development organizations can adopt practices which maximize the benefits of local healthcare availability. A 2021 report from the Aspen Institute discusses how rural development and healthcare organizations' similar needs and priorities can create opportunities for collaboration. In addition to discrete, mutually beneficial initiatives like workforce development programs or regional purchase agreements, the report describes the value of more in-depth forms of cooperation, including shared goal setting, integrated funding and infrastructure use, and utilizing data and definitions which take into account the interrelatedness of rural healthcare and community development.

Why should local healthcare leadership be involved in community and economic development efforts and what role can they play?

Healthcare is big business and, together with social services and education, is one of the top 3 employers in rural communities according to the U.S. Census Bureau article Beyond the Farm: Rural Industry Workers in America. Because the healthcare sector is a major economic contributor and a sought-out amenity for businesses and individuals looking to move into a community, the input of healthcare leadership is important to local development efforts.

Rural healthcare leaders can play a role in community and economic development efforts through involvement in local organizations, schools, chambers of commerce, philanthropy, and events. Partnerships between healthcare leaders and other institutions and individuals in rural communities are essential to fostering economic development. According to a 2021 case study from the American Hospital Association, The Hospital as a Convener in Rural Communities, rural facilities can play a key role in bringing together stakeholders in education, behavioral health, housing, food, transportation, and government.

Healthcare leaders may participate in community and economic development to improve community conditions that affect health, leading to more equitable health outcomes and potential reductions in medical interventions. Another motivator for healthcare engagement in economic development activity is to strengthen or retain a healthy payer mix, including commercially insured patients from local businesses. Strategies for creating and sustaining cross-sector partnerships can be found in The Build Healthy Places Network's Playbook for New Rural Healthcare Partnership Models of Investment, which includes case studies of organizations that successfully implemented healthcare partnerships in a variety of settings. Additional examples can be found in the Rural Monitor article “Economic Development is Population Health”: A New Vision for Rural Hospital Leadership, which features hospitals that support community health by funding quality-of-life initiatives and investing in local economic development in rural Wisconsin and New Hampshire.

Healthcare leaders' participation in activities such as county/regional boards and leadership institutes can promote local healthcare awareness among current and developing leaders. By conducting an economic impact analysis, they can inform other community leaders and the community at large about the economic impact of the healthcare delivery system.

How can communities illustrate the importance of healthcare to our local economy?

An economic impact study of healthcare in a rural community will illustrate the importance of healthcare to the local economy. Using local data in the impact study, healthcare and community leaders can demonstrate the significance of the healthcare system to the community. This can help community members understand the importance of the entire health sector, any component of the health sector, or a specific healthcare organization.

An economic impact study can engage the community to be involved in local healthcare issues. Outcomes of a community economic impact study may include engaging the community to:

  • Assist in finding solutions to healthcare challenges
  • Participate in a community health needs assessment process
  • Increase local support and utilization of a particular health service or all health services
  • Increase access to local healthcare services through the expansion of their rural healthcare system and the development of new healthcare programs
  • Gain local support for a capital improvement campaign to construct new facilities, expand current facilities, or purchase new equipment to provide the latest medical technology
  • Assist in obtaining capital funding from investment and banking institutions
  • Recognize the value of healthcare workforce training programs and healthcare partnerships with higher education
  • Consider healthcare as an economic development tool to encourage new business and industry, and to attract retirees to the community
  • Ensure the ongoing existence of local health services
  • Establish or increase community infrastructure, such as broadband

A 2022 report on hospital community benefits prepared for the American Hospital Association found that tax-exempt hospitals provide an estimated $110.9 billion in community benefit nationwide, a value 9 times that of the tax revenue forgone by granting nonprofit hospitals tax-exempt status. Conversely, hospital closures can negatively impact community economic health. A 2021 findings brief by the Rural & Minority Health Research Center identified increased rates of poverty, unemployment, and mortality in rural counties which experienced hospital closures compared with those that did not. The report also indicated that hospital closures were concentrated in areas that were more rural, had higher proportions of non-White population, and were already experiencing financial distress.

The Center for Economic Analysis of Rural Health offers mapping tools and resources that support efforts to create sustainable rural healthcare systems and communicate their importance to rural communities. Their Healthcare Industry Characteristics map, for example, provides county-level data on healthcare employment, job postings, and wages that can be useful for comparisons in an economic impact study.

Where can our rural community find the resources to determine the economic impact of our healthcare sector or a component of the healthcare sector?

For local leaders or healthcare organizations needing assistance in measuring the economic impact of a health sector component, their State Office of Rural Health can help them connect with resources for conducting a local healthcare economic impact study. In many states, personalized support and resources are also provided by Cooperative Extension services, Area Health Education Centers (AHECs), hospital associations, or State Offices of Rural Health themselves.

For distinct health-related projects, such as those funded by grants, the Economic Impact Analysis Tool shows how a project's spending on staff, supplies, equipment, and other expenses benefits the state. Originally developed for the Federal Office of Rural Health Policy's community-based grantees, this tool uses formulas to estimate the economic impact of grant program investments; however, it can also be applicable to non-grant funded projects. The calculations help rural program grantees and other rural programs demonstrate the economic impact of their program's spending and provide tools for those organizations to advocate for resources that contribute to program sustainability and improved healthcare for rural populations.

Where can our community find training on economic impact and other tools to enhance our local healthcare services and ultimately enhance our local community?

The Center for Rural Affairs provides comprehensive rural community development services and focuses on policies that support rural community development, resource stewardship, and small farms and businesses. The organization offers trainings on rural topics and produces publications on rural issues. The Heartland Center for Leadership Development provides training and services in leadership, community development, strategic planning, evaluation, and entrepreneurship. The Center for Economic Analysis of Rural Health also offers training through webinars and presentations.

The Rural Wisconsin Health Cooperative's Community Economic Development Program offers quarterly trainings on economic development issues for healthcare leaders and economic development professionals interested in collaborating with healthcare institutions. Additionally, RWHC provides local technical assistance and data analysis to rural healthcare institutions looking to engage in local community economic development.

USDA Rural Development administers several Programs & Services for Communities & Nonprofits throughout rural America. Contact your state or local Rural Development office or your local USDA Service Center for additional information regarding technical assistance and funding to support self-sustaining, long-term rural development.

For an overview of Community Health Needs Assessments (CHNAs) and other types of needs assessments which are relevant to rural health, including discussion of the types of tools and resources which are available for rural facilities, see the Conducting Rural Health Research, Needs Assessments, and Program Evaluations topic guide.

What is asset-mapping and how does it contribute to rural community vitality?

Taking stock of a rural community's assets, including the skills and talents of its existing individuals, businesses, organizations, and institutions, is an important part of assessing community needs and potential for economic development. Asset mapping emphasizes the positive (what a community has to offer) over the negative (deficiencies in a community) to focus the community on its strengths. Mapping the Assets of Your Community: A Key Component for Building Local Capacity, a publication of the Southern Rural Development Center, outlines the differences of needs-based and asset-based frameworks when approaching community development. The author notes that conversations on “assets” lead to collective efforts, shared talents, and community empowerment. Conversely, a focus on “needs” often identifies deficiencies and can lead to fragmented responses by community members or institutions who seem responsible for the issue. The report explains,

“Asset mapping begins with the philosophy that all local residents, regardless of age, gender, race, ethnic background, place of residence, or other characteristics, can play an effective role in addressing important local matters. Local people and organizations are encouraged to explore how problems might be interrelated, and to respond to these issues in a coordinated, collaborative fashion.”

In rural communities, building on current assets is essential to economic development. Community assets that contribute to vitality in different ways include:

  • Associations, such as business organizations, educational groups, neighborhood watches, and community-based organizations
  • Individuals, whose skills, knowledge, experiences, educational backgrounds, and unique perspectives contribute to holistic and equitable planning
  • Institutions, including public, private, and nonprofit agencies such as schools, libraries, religious institutions, service groups, and healthcare facilities
  • Physical spaces, such as public recreation areas, parks, playgrounds, and gardens
  • Local economic institutions, including businesses, banks, credit unions, local foundations, and local chambers of commerce

The Collaborative for Neighborhood Transformation's toolkit What is Asset Based Community Development (ABCD) highlights the distinct strengths and limitations of associations and institutions. Associations are governed by and serve citizens and are driven by the capacity of their members, while institutions are governed by an organized or hierarchical structure, are driven by need for service, and benefit clients or consumers.

According to the toolkit, communities should build social capital, defined as networks of community members that increase participation in community and economic activity. Social capital moves communities beyond service-client relationships and expands relationships between institutions and associations to empower citizens to pool their talents and skills.

Communities participating in asset mapping can also benefit by ensuring that less obvious assets aren't overlooked. The Community Capitals Framework, which was summarized in a 2014 article, identifies seven categories of community assets: natural, cultural, human, social, political, financial, and built. By considering each of these types of capital during the asset mapping process, communities may benefit from a more accurate understanding of their available resources and priorities for future development.

Initiatives that aim to improve rural community-based health can also benefit from asset mapping. For example, the Seneca Towns Engaging People for Solutions (STEPS) program seeks to improve social, educational, physical, and economic health in the rural Finger Lakes communities of New York, as discussed in the Social Determinants of Health in Rural Communities toolkit. The SDOH toolkit further explores asset-based community development.

For more on the benefits of asset-based strategies, see Asset-Based Economic Development and Building Sustainable Rural Communities, a series of briefing papers from the International City/County Management Association (ICMA) Center for Sustainable Communities. The brief discusses asset-based economic development as a ground-up approach to growing rural and local economies based on existing industries, emerging industries, and local talent.

How does the vitality of a rural community affect health workforce recruitment and retention?

Every community has assets and challenges that impact efforts to recruit and retain healthcare providers. Recruitment and retention efforts must take into consideration location and the needs of the population and patients that the healthcare organization serves.

A 2023 USDA report surveyed healthcare professionals, community leaders, and healthcare administrators to establish how community capital influences rural health professional recruitment and retention. Social capital, physical capital, and human capital were recognized as important variables across participant groups, suggesting that community investments in these areas can significantly improve a community's ability to recruit and retain healthcare professionals. However, the relative importance of each type of community capital varies by region and profession, discouraging a one-size-fits-all approach.

Rural healthcare organizations interested in understanding how local community factors are influencing recruitment and retention may look to the Community Apgar Project (CAP). CAP analyzes the relative importance of key factors for recruitment and retention in rural communities, guiding strategic planning. The project initially studied family medicine physicians and has expanded to analyzing the recruitment and retention of other healthcare professions, including CEOs at Critical Access Hospitals.

Collaborations between healthcare facilities and community leaders rely on a shared understanding of the elements that make a community unique, as well as agreement on the best strategies to overcome local challenges. One model associated with sustainable investment and growth in rural areas is place-based economic development. As described in a 2017 Urban Institute report, place-based initiatives focus on developing vibrant communities to attract workforce talent rather than attracting business investment in communities. For another example of the significance of community development for healthcare recruitment, see the Rural Monitor article Housing Shortages Are Making Recruitment and Retention Even More Challenging for Some Rural Healthcare Providers, which describes how community leaders and healthcare organizations responded to housing shortages in rural Colorado and Oregon.

The Recruitment and Retention for Rural Health Facilities topic guide provides information and resources regarding strategies and incentives to help rural communities attract and retain healthcare providers.

What opportunities are available for rural communities to invest in their infrastructure to support their healthcare system?

Several federal agencies sponsor programs to strengthen the infrastructure in rural communities. Projects funded by these agencies may strengthen and support local healthcare, such as road improvements and broadband capabilities to facilitate access to healthcare.

USDA Rural Development offers grants, grant/loan combinations, and loans to public bodies, private nonprofit corporations, and tribal governments to finance or assist in community development. For the best program that would fit your community needs, contact your local USDA-RD Service Center.

For additional exploration of funding sources for infrastructure development, including non-federal sources such as Community Development Financial Institutions (CDFIs), see the Capital Funding for Rural Healthcare topic guide.

Investment in broadband internet infrastructure is a critical issue in rural areas. The COVID-19 pandemic made it clear that broadband availability is a necessity for rural community vitality, as broadband is necessary to access telehealth services, which providers are increasingly seeking to extend to rural populations. Broadband is also a factor in a community's ability to attract employers, to support education, and to provide the infrastructure needed for rural residents to work remotely. The Rural Monitor article Broadband in Rural America: Faster Speeds for Home and Healthcare explores the importance of broadband to accessing telehealth services and supporting remote work capacity in rural areas. For information about broadband coverage in your area, see the Federal Communications Commission (FCC) Broadband Map. The map may not always be precise, however, as it provides information on broad coverage areas.

The Center on Rural Innovation, an organization that partners with rural communities to explore options for investing in internet infrastructure, offers a rural opportunity map to help communities understand the economic dynamics in their area and a toolkit for communities seeking to develop digital-based jobs.

The Health Resources and Services Administration's Office for the Advancement of Telehealth administers several grants and programs focused on telehealth technical assistance, research, direct services, and workforce.

For more information on telehealth and broadband, see the Telehealth and Health Information Technology in Rural Healthcare topic guide. Additional funding programs can also be found in the Funding & Opportunities section which can be searched by topic and by state.

Why is it important to consider the capacity of the local healthcare system to anticipate economic growth?

When economic growth occurs, the capacity of the local healthcare system may need to increase to support services for new families and businesses. This, in turn, generates additional economic growth in the healthcare sector. If the healthcare system is challenged to keep pace with the health needs of the growing community, the lack of adequate capacity could affect access and quality for existing community members and new residents. Families and businesses may seek healthcare outside the local area or not at all, decreasing the economic impact of these new businesses and families.

It is important that community-based economic development officials and businesses share information with their local healthcare system about expected major economic growth. Health systems can encourage communication by inviting local organization participation in boards and committees, and holding regular meetings to discuss common interests in the local economy such as hospital infrastructure and service plans, workforce needs, business or school openings and closings, and road repairs and other infrastructure updates. Healthcare facilities will use this information to plan for growth that may increase demand for services, as well as factors that may impact their expenses, such as increased competition for workers. Healthcare facilities that are not prepared for major economic growth in the community may be significantly strained as they try to meet the changing needs of the community.

What is the role of philanthropy and nonprofit organizations in community development?

While many nonprofit organizations and philanthropic foundations support the health and service needs of specific populations or specific regions, rural America has historically received a far smaller share of grant funds compared to metro-based organizations. A 2015 study from the USDA Economic Research Service (ERS) found that rural organizations were awarded only 5.5% of U.S. foundation grants, on average, from 2005-2010. This figure does not consider grants awarded to urban communities that benefit nearby rural populations.

Challenges that impact rural organizations seeking grant funds include demonstrating impact in areas with lower population and fewer clients served, matching fund requirements, and limited resources or staff. For more information on philanthropy in rural areas and strategies for building partnerships with foundations, see A Guide to Working with Rural Philanthropy developed in collaboration with the NORC Walsh Center for Rural Health Analysis.

For rural communities experiencing long-term disinvestment, intermittent funding and lack of organizational capacity can hamper development. In response, some philanthropic and nonprofit organizations have adopted strategies on local partnerships and capacity-building. The Two Georgias Initiative, which was featured in an episode of the Exploring Rural Health podcast, used its five-year funding and coaching commitment to increase health equity, establish lasting relationships with rural community coalitions, and facilitate access to other funding sources. For another example of a successful rural development partnership, see the Rural Monitor article Collaboration, Not Competition: Thrive Allen County's Capacity Building Initiatives, which describes how a rural Kansas nonprofit expanded its grant writing team and offered free services to other government and nonprofit entities in the county, resulting in new partnerships and significant increases in funding for community development and quality of life.

Some rural community organizations have approached grant funding and grantmaking collectively, collaborating to pursue innovative economic development strategies by building on natural, cultural, or other non-financial assets. For example, Thrive Regional Partnership brings together stakeholders from the tri-state Chattanooga region of southeast Tennessee, northwest Georgia, and northeast Alabama, including 15 rural communities, to sustainably grow industry and regional wealth.

Similar partnerships have brought together federal and philanthropic funds to improve healthcare access and quality of care. In 2015, the Rural Health Aligned Funding Initiative grew out of a partnership between philanthropies, federal agencies, and healthcare representatives, principally funded by the Federal Office of Rural Health Policy and philanthropic resources. The initiative targeted care coordination to address health inequity in rural communities. The Rural Monitor article Rural Health Philanthropy Partnerships: Leveraging Public-Private Funds to Improve Health describes the program and two of its community partners, one in West Virginia and the other in eastern Washington.

To learn more about rural philanthropy, see our page on Rural Health Philanthropy.

Who can I contact regarding additional information and resources focused on community vitality and its effect on the healthcare system?

  • For technical assistance and funding to support self-sustaining, long-term rural development, contact USDA Rural Development, your local USDA-RD Service Center or your state USDA-RD office.
  • The Center for Economic Analysis of Rural Health offers resources and training opportunities for local leaders to improve the sustainability of rural healthcare systems.
  • Grantmakers in Health is a membership organization that works with philanthropic organizations and health funders, providing technical assistance and collaborative support.
  • The Rural Wisconsin Health Cooperative's Community Economic Development Program offers educational and networking opportunities for healthcare leaders interested in growing their involvement in and knowledge of economic development as well as economic development practitioners interested in collaborating with healthcare institutions. The program also offers local technical assistance and data analysis services tailored to the needs of individual healthcare organizations and their communities.
  • The Healthcare Anchor Network provides resources and guidance for member health systems to address economic, social, and racial inequities at the local level through strategic hiring, investment, and resource management.
Last Updated: 11/25/2024
Last Reviewed: 11/25/2024