Medicaid may be a factor but not necesarily so. Increased regulation and paperwork is another possibility. Have expenses gone up ? Regulations cost money. How many small towns have lost doctors? Rural hospital closings existed prior to ACA and have continued.
The consensus is that Medicaid is the culprit in the accelerated closings. The states- particularly those in the South- that have the highest rates of failure are the states that did not participate in Medicaid expansion. Again, the article clearly stated:
...approximately 85% of the closings occurred in states that have not, or had yet to, expand the Medicaid programs in their state.
If the issue were not Medicaid-related, the failure rate would be uniform since every state in the US has rural hospitals. Unfortunately for the uninsured, the states with a disproportionate share of uninsured patients and patients who subsist below the federal poverty level (FPL) are in states with Republican governors who did not expand Medicaid in their state:
Southern states have especially high rates of vulnerability when compared to their total number of rural hospitals. States in this region with high rates of vulnerability include Mississippi (79 percent), Louisiana (58 percent) and Georgia (53 percent).
Source Source
Disproportionate Share (DSH) is a key concept in rural hospital reimbursement. Any hospital that sees a large number of uninsured patients or private pay patients can seek additional funding from the government to help these hospitals maintain financial solvency. University Hospitals, public health hospitals and rural hospitals receive funds from the federal government under the Disproportionate Share program.
When the ACA went into affect, because there was a mandate for patients above the FPL to carry private insurance and because Medicaid was expanded to cover the "working poor" who were employed but could not afford private insurance, the assumption was that the Disproportionate Share funds would be lowered. This was a double-whammy for those states whose governors and legislators who did not accept Medicaid expansion: these hospitals are receiving less DSH funds and they are still having to treat uninsured patients in their emergency rooms. Often these uninsured patients come to the hospitals when they are critically ill because they could not afford less expensive primary care early in their illness or because they were unable to afford medications like insulin or blood pressure medication that may have prevented them from getting sicker.
Kentucky provides a good case study of the effects of the ACA and Medicaid expansion. In 2014, hospitals in Kentucky were worried that the increased number of Medicaid patients would bankrupt hospitals in rural areas. They were seeing many sick patients who were seeking care because they were now able to pay for that care under Kentucky's Kynect Medicaid program.
In 2015, Kentucky hospitals had $552 million in charity care costs, compared with $2.4 billion four years ago. By 2016, the situation had turned around- hospital reimbursement was up and Medicaid patients had shifted to primary care. The patients in Kentucky were seeing physicians in their office instead of using the Emergency Rooms as primary care clinics. There were patients who were interviewed for a study of Kynect who stated that they used to go to the emergency room 3-4 times per month before they went on Medicaid; now they see their physician on a regular basis. This is also born out in key metrics like measures of blood sugar in diabetics- by using primary care and home medications to keep blood sugar under control, the number of times that these patients used emergency care services was greatly reduced.
Kentucky's Republican governor is now trying to find ways to improve the Kynect program instead of repealing it. They're looking at making Medicaid work more like a traditional insurance program with affordable copays and coinsurance where the patient pays a reasonable portion of the cost of their healthcare. They will probably switch patients to using the federal exchange instead of running a separate state exchange.
](/images/smilies/bang.gif "Brick wall ](*,)")
Instead of paying a penalty to the U.S. government, you'll now enrich the insurance companies 
