Rural isolation and the availability of hospital services

This study empirically examines some important factors affecting the geographic distribution of hospitals. Using 1996 cross-sectional data on hospital locations in Texas, we employ a count-data methodology to estimate the impact of demand and rural isolation on the frequency of hospital service in a given geographical area. Using the modelʹs estimates, we calculate the population thresholds needed to support a given frequency. Results suggest that population, population density, per capita income, and rural isolation are important factors in determining the number of hospitals in an area. Our methodology and results provide a means to inform and evaluate policy decisions regarding the designation of medically underserved areas.