The Lead Off

• Sturgis Hospital has closed after more than a century of serving southwest Michigan, citing ongoing financial challenges facing rural health care providers.
• Health care experts warn other rural hospitals could face similar struggles as costs rise and federal health care programs change.
• The closure has forced patients and emergency responders to travel farther for some services previously available locally.

STURGIS, MICH. (WOWO) Sturgis Hospital has closed its doors after more than 100 years of serving patients in rural St. Joseph County, with health care experts warning the shutdown could be the first of more rural hospital closures in Michigan.

The independently owned hospital closed June 19, citing “years of ongoing financial challenges” affecting rural health care providers.

The facility had 84 licensed beds and about 300 employees before shutting down according to Bridge Michigan.

Sturgis closure follows years of financial challenges

Sturgis Hospital had taken several steps in recent years to remain open, including receiving pandemic relief funding from the city, state assistance and a new federal designation.

In 2023, Sturgis Hospital became Michigan’s first federally designated rural emergency hospital, a status created to provide additional financial support for facilities struggling with the costs of rural care.

Despite those efforts, hospital officials said they could not find a sustainable path forward.

“Despite extensive efforts by hospital leadership and the Board of Directors to secure the hospital’s future, including pursuing potential acquisition opportunities and partnerships, a sustainable path forward could not be achieved,” Sturgis Hospital said in its closure announcement.

Former employees describe impact

Former Sturgis Hospital nurse Beth Kelley worked at the facility for 32 years.

Kelley said the hospital’s small-community environment was a major part of its identity.

“I like the small hospital atmosphere,” Kelley told Bridge Michigan. “I know this is maybe a little cliché, but it’s like family.”

Kelley said employees were shocked when administrators announced the closure during a staff meeting and told workers the hospital would shut down within about 70 hours.

She said many long-time employees were left searching for new jobs while completing their final shifts.

Rural hospitals face growing pressures

Health care researchers and policy experts say Sturgis Hospital’s closure reflects broader challenges affecting rural hospitals nationwide.

They point to several factors, including:

• Rising operating costs
• Workforce shortages
• Declining reimbursement rates
• Heavy reliance on Medicare and Medicaid patients
• Changes to federal health care programs

According to the Cecil G. Sheps Center for Health Services Research at the University of North Carolina at Chapel Hill, five rural hospitals in Michigan have closed since 2005.

Researchers have warned additional facilities could face financial risks.

Service reductions spread across Michigan

Experts say some rural hospitals have avoided closing by cutting major services.

In recent years, hospitals including Aspirus Ironwood Hospital and MyMichigan Medical Center in Tawas City have ended labor and delivery services.

Michael Shepherd, an assistant professor at the University of Michigan School of Public Health, said rural maternity services are especially difficult to maintain because of high costs and staffing challenges.

“Half of births in rural communities are being paid for by Medicaid at the moment,” Shepherd said.

He said proposed Medicaid reductions could create additional financial challenges for rural hospitals.

Sturgis Hospital had already closed its birthing center in 2018 before ending remaining services, including:

• Surgery
• Laboratory services
• Medical imaging
• Physical therapy
• Endoscopy
• Cardiac rehabilitation

Patients face longer trips for care

The closure has also changed access to emergency services in the Sturgis area.

Sturgis Director of Public Safety Ryan Banaszak said ambulances now have to travel farther when transporting patients.

“What was once approximately a 2-mile transport for patients has now become closer to 25 miles, which takes ambulance personnel and equipment out of service for a much longer period of time,” Banaszak said.

Nearby hospitals in Three Rivers, Coldwater and LaGrange, Indiana, are now among the closest alternatives for emergency care.

Health care officials also said some low-income patients could face additional challenges because Michigan Medicaid patients may have restrictions on receiving care across state lines.

Experts warn of possible future closures

Dr. Andrea Wendling, a family physician and senior associate dean for academic affairs at Michigan State University’s College of Human Medicine, said rural hospitals are under increasing financial pressure.

She said fewer patients receiving preventive care can lead to more emergency visits and higher costs.

Wendling said she worries the Sturgis closure could signal more shutdowns ahead.

She described the closure as “the first of more closings that we’re going to see over the next few years” in Michigan.

Wendling said independent hospitals are often pressured to join larger health systems because of potential benefits such as stronger negotiating power with insurers and reduced administrative costs.

Efforts continue to support rural care

The Michigan Health & Hospital Association said rural hospitals need long-term policies that recognize the challenges of serving smaller communities.

Lauren LaPine-Ray, vice president of policy and rural health for the association, said rural hospitals need support because they often serve older populations with higher rates of Medicare and Medicaid coverage.

She pointed to tools such as the federal 340B drug pricing program and “swing beds,” which allow hospitals to adjust beds between acute and post-acute care depending on demand.

Michigan has also received a $173 million grant through the Rural Health Transformation Program to support rural health efforts.

Former employees move forward

Kelley has since found part-time work at Three Rivers Health Hospital as an as-needed nurse.

She said the transition has been difficult after decades in a full-time position at Sturgis Hospital.

“I’m hoping for 40 hours a week, but that’s probably not realistic,” Kelley said.

She said the closure will have a larger impact on some patients who now face longer travel times for medical care.

“For some of those people, it could be a matter of life and death,” Kelley said.

What happens next

Health care officials and policymakers continue evaluating ways to support rural hospitals as facilities face financial challenges. The impact of Sturgis Hospital’s closure will continue to be monitored as patients, employees and emergency responders adjust to the