This study examines the underutilization of rural hospitals in Kentucky. The authors study hospital and patient characteristics to determine why and how rural patients bypass local rural hospitals and how they make their decision in the hospital choice. A Health Care Service Survey conducted in rural Kentucky and hospital data drew from American Hospital Directory are used. A binary probit model and a conditional logit model are applied. The results suggest that the hospital quality, prior experiences and the satisfaction of the local hospital, along with patients’ value of hospital size, reputation and patients’ insurance coverage influence rural patients’ hospital choice. The study offers seven policy implications to better utilize rural health care institutions.

Among 10,384 rural Colorado female patients who received MDC 14 (obstetric services) from 2000 to 2003, 6,615 (63.7%) were admitted to their local rural hospitals; 1,654 (15.9%) were admitted to other rural hospitals; and 2,115 (20.4%) traveled to urban hospitals for inpatient services. This study is to examine how network participation, service scopes, and market competition influences rural women's choice of hospital for their obstetric care. A conditional logistic regression analysis was used. The network participation (p < 0.01), the number of services offered (p < 0.05), and the hospital market competition had a positive and significant relationship with patients' choice to receive obstetric care. That is, rural patients prefer to receive care from a hospital that participates in a network, that provides more number of services, and that has a greater market share (i.e., a lower level of market competition) in their locality. Rural hospitals could actively increase their competitiveness and market share by increasing the number of health care services provided and seeking to network with other hospitals.

The bypassing of rural hospitals increased in Colorado's rural communities during the 1990s. To understand this phenomenon, this study explores why rural Medicare patients in Colorado bypassed their local rural hospitals when they could have received health care services at their nearest local hospital. To identify both individual factors and institutional variables associated with hospital choice behavior, the conditional logistic regression model analyzes 4,099 rural Medicare patients who received heart failure and shock procedures. This study determines that both institutional variables (ownership type, number of beds, number of services, accreditation, and distance between the hospital and a patient's residence) and patient variables (age, length of stay, race, and total charge) are significant in patients' hospital choice. This study suggests that rural hospitals could build cooperative relationships with other large rural and urban hospitals.