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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 community supports and sustains quality health and social services for its residents by attracting and retaining well-trained and committed healthcare professionals. Communities with strong economies may be more likely to financially support their healthcare system through philanthropic giving and by investing in infrastructure that can be leveraged by the healthcare system. 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 assessing 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. These areas affect the resilience of communities. In particular, 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 deficiency 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 assets 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.

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 (what a community is deficient in) 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 “needs” often focus on deficiencies and lead to fragmented responses by community members or institutions who seem responsible for the issue. Conversely, building on “assets” leads to collective efforts, shared talents, and community empowerment. 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, 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, expanding relationships between institutions and associations to empower citizens to pool their talents and skills.

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 RHIhub Social Determinants of Health in Rural Communities toolkit. The SDOH toolkit and the RHIhub Rural Community Health toolkits further explore asset-based community development and asset identification procedures.

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 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. Rural healthcare systems are often one of the largest employers in their community, as noted in this 2017 publication from the American Hospital Association. They 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.

According to the American Medical Association's Physicians Boost the Economy, a physician in a community translates into real revenue and real jobs. 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.

Some specific examples of how local healthcare services can impact the economy include:

  • 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 a key service such as a dialysis facility, 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.
  • According to a 2016 assessment from the NCRHW, for every job in a Critical Access Hospital, another 0.34 jobs are created in other local businesses and industries. A Critical Access Hospital generates an average of $1.8 million in taxable retail sales in the rural community.

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. In 2016, the National Alliance of Community Economic Development Associations held the Community Development and the Social Determinants of Health Symposium, offering links to presentation slides and recommended readings on community development to support health and wellness.

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 jobs and dollars brought into the community through healthcare services.

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

Healthcare services are important to community and economic development not only in terms of the employment and labor income generated in the local economy, but also to attract and retain business and industry. As remote work and web-based employment become more popular and necessary during public health emergencies like the COVID-19 pandemic, access to healthcare is an important consideration for workers to continue to live in or relocate to rural areas.

Retirees are more likely to move to or stay in rural communities with quality healthcare facilities, and data have demonstrated that retirees can substantially impact the local economy. 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.

Healthcare leadership should be involved in community and economic development to assure that the healthcare services needed for attracting and retaining businesses, industries, and retirees are provided locally. Rural hospitals can also play a role in the community by working with high schools and community colleges to develop the emerging workforce.

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. With an economic impact study, healthcare and community leaders can demonstrate, with local data, the significance of the healthcare system to the community. This can help community members fully understand the importance of the entire health sector, any component of the health sector, or a specific health 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
  • 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

The USDA Economic Research Service's 2017 report Employment Spillover Effects of Rural Inpatient Healthcare Facilities estimates a lower inpatient healthcare facility employment multiplier for micropolitan counties at 1.24 jobs per healthcare job, further estimating .89 jobs for rural noncore counties. The authors note that this difference is expected, as micropolitan areas are more economically integrated with goods and services contained within the same county, compared to more rural areas.

A 2019 report on hospital community benefits prepared for the American Hospital Association found that tax-exempt hospitals provide an estimated $95 billion in community benefit nationwide, a value 11 times that of the tax revenue forgone by granting non-profit hospitals tax-exempt status. On the other hand, hospital closures can negatively impact community economic health. According to a 2006 study, rural hospital closures reduce per-capita income by $703 and increase unemployment rates by 1.6%.

The Center for Economic Analysis of Rural Health offers mapping tools and resources that support efforts to make rural healthcare more sustainable and that communicate the importance of health systems 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?

If local leaders or healthcare organizations need assistance to measure the economic impact of a health sector component, the first contact should be with their State Office of Rural Health. In many states, the State Office of Rural Health, the state Cooperative Extension service, state Area Health Education Centers (AHECs), or the state hospital association have trained staff available to conduct health economic impact studies at no or nominal cost. Partnerships established with these state-based organizations can serve as a resource for conducting a local healthcare economic impact study.

For distinct health-related projects, such as those funded by grants, RHIhub's Economic Impact Analysis Tool shows how a project's spending on staff, supplies, equipment, and other expenses benefits the community. Originally developed by the Lewin Group 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 other 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.

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 community economic development in their communities.

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.

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 medical staff. Recruitment and retention efforts must also take into consideration location and the particular needs of the population and patients that the healthcare organization serves.

The Community Apgar Program, developed through a collaboration of Boise State University and the Family Medicine Residency of Idaho, analyzed the relative importance of key factors for recruitment, along with the common advantages and challenges that rural communities face in this process. The factors used by this program fall into the categories of geographic, economic, scope of practice, medical support, and facility and community support. Specific factors include schools, housing availability, climate, loan repayment, emergency care, mental health, nursing workforce, specialty care, electronic medical records, and other elements which characterize the community's capability to recruit and retain physicians.

Rural healthcare facilities and community leaders can collaborate to overcome challenges to recruiting and retaining medical staff. They can analyze the community's advantages and challenges, leverage assets, and address problem areas. An improved understanding of the factors that make a community unique can help leaders to decide where to focus recruitment strategies and investments and how to structure the interview process and retention plans. Place-based economic development, as described in this Urban Institute report, focuses on developing vibrant communities to attract workforce talent rather than attracting business investment in communities.

RHIhub's topic guide Recruitment and Retention for Rural Health Facilities 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 non-profit 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.

Investment in broadband internet infrastructure is a critical issue in rural areas. The COVID-19 pandemic has 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 in the tech industry, 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. For more on the importance of broadband to rural healthcare access, see our Telehealth and Health Information Technology in Rural Healthcare topic guide.

The Federal Office of Rural Health Policy offers telehealth grant programs to expand telehealth technologies for healthcare delivery, information services, and education. For more information on telehealth and telehealth-related funding opportunities, see our Telehealth and Health Information Technology in Rural Healthcare topic guide.

Additional funding programs can be found in RHIhub's Funding & Opportunities section where you can browse 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, would generate 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 everyone, including both long-time 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. This will allow healthcare facilities to plan for growth that may increase demand for services, as well as factors that may affect their expenses, such as increased competition for workers. When healthcare facilities are not prepared for major economic growth in the community, it places significant strains on facilities as they try to meet the changing needs of the community.

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

While there are many nonprofit organizations and philanthropic foundations that 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 therefore 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.

Some organizations in rural communities 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 project targets 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 also offers resources and training opportunities for local leaders seeking 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 interesting 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.
Last Updated: 4/17/2024
Last Reviewed: 5/26/2021