Residents' Willingness-to-Pay for Attributes of Rural Health Care Facilities

• Published in: The Journal of rural health Vol. 31; no. 1; pp. 7 - 18
• Main Authors: Allen IV, James E., Davis, Alison F., Hu, Wuyang, Owusu-Amankwah, Emmanuel
• Format: Journal Article
• Language: English
• Published: England Blackwell Publishing Ltd 2015; Wiley Subscription Services, Inc
• Subjects: Acceptances; Cancer; Choice Behavior; Clinics; critical access hospital; econometrics; economics; Financing, Personal - economics; Financing, Personal - methods; Health facilities; Health Services Accessibility - standards; health services research; Hospitals; Humans; Kentucky; Medicaid program; Medical service; Medicare; Patient Protection and Affordable Care Act - economics; Rural areas; Rural health care; rural health clinic; Rural Health Services - economics; Rural Population; Willingness to pay; health services research; economics; econometrics; rural health clinic; critical access hospital
• ISSN: 0890-765X; 1748-0361
• DOI: 10.1111/jrh.12080

Context As today's rural hospitals have struggled with financial sustainability for the past 2 decades, it is critical to understand their value relative to alternatives, such as rural health clinics and private practices. Purpose To estimate the willingness‐to‐pay for specific attributes of rural health care facilities in rural Kentucky to determine which services and operational characteristics are most valued by rural residents. Methodology We fitted choice experiment data from 769 respondents in 10 rural Kentucky counties to a conditional logit model and used the results to estimate willingness‐to‐pay for attributes in several categories, including hours open, types of insurance accepted, and availability of health care professionals and specialized care. Findings Acceptance of Medicaid/Medicare with use of a sliding fee scale versus acceptance of only private insurance was the most valued attribute. Presence of full diagnostic services, an emergency room, and 24‐hour/7‐day‐per‐week access were also highly valued. Conversely, the presence of specialized care, such as physical therapy, cancer care, or dialysis, was not valued. In total, respondents were willing to pay $225 more annually to support a hospital relative to a rural health clinic. Conclusion Rural Kentuckians value the services, convenience, and security that rural hospitals offer, though they are not willing to pay more for specialized care that may be available in larger medical treatment centers. The results also inform which attributes might be added to existing rural health facilities to make them more valuable to local residents.