What happens when a nearby hospital shuts down and you’re left holding the bag

Hospital closures create an operational shockwave.

As of 2025, 16 hospitals have already shut down, following 25 closures the year prior according to Becker’s.

Many of these facilities have closed abruptly, citing financial unsustainability, workforce shortages, or environmental strain, but their closure doesn’t stop the flow of patients or providers.

It redirects them, usually into neighboring health systems that are already working near their administrative limits.

This trend is confirmed by recent research showing significant increases in emergency visits and inpatient admissions at nearby “bystander” hospitals following rural closures.

For provider operations teams, this shift is a real-time stress test. 

• Medical credentialing timelines stretch. 
• Enrollment files pile up. 
• Compliance risks escalate. 

In short, everything gets heavier, and the workflows that seemed “fine” under normal volume start to show cracks. As the study from the Journal Hospital of Medicine states, “Greater numbers of inpatient general medicine patients increase costs through facilities and staffing, creating challenges for hospital growth and viability.”

If you’ve ever had to onboard a dozen providers within two weeks following a closure—without blowing up your payer relationships or staff morale—you’ve lived this reality.

This is the operational reality of hospital closure operations. And, most systems aren’t ready for it.

So when hospital closures happen, which functions break down first?

Medical credentialing is one of the first bottlenecks

A hospital shuts down, admissions to nearby care centers spike as displaced patients seek care elsewhere. 

To keep pace, the hospital scrambles to staff up—bringing in additional nurses, onboarding temporary physicians, and reallocating internal resources. Credentialing processes that normally take weeks now need to happen in days.

And displaced providers need a new home, fast. 

That means intake packets, credentialing files, verifications, and committee reviews all hit the system at once. 

In a best-case scenario, your credentialing platform can accommodate this volume with automated verifications, real-time data monitoring and tracking, and even templated workflows. In most cases, though, credentialing is still a partially manual process. 73% of healthcare teams that were surveyed earlier this year admitted primary source verification tasks (PSVs) were manual which slowed down work, and 27% of those teams still complete PSVs entirely by hand, with staff visiting individual websites to verify credentials. This way of working is no way to scale.

In addition, increased credentialing volume often leads to significant medical credentialing delays, which stall start dates and delay care access, and withhold revenue. 

The American Medical Association notes that the average credentialing time for a physician can be 60–120 days, depending on the organization and its internal processes. In environments without automated workflows, a single delay (e.g., missing primary source verifications, delayed NPDB reports, or outdated committee calendars) can hold up an entire provider’s start date. 

Multiply that by 10 or 20 new providers onboarded after a nearby hospital closure, and you have a systemic bottleneck.

Beyond revenue impact and administrative drag, credentialing delays can affect access to care, and team trust. Clinical leaders grow frustrated when new hires are waiting weeks to start. HR feels the pressure to "move things along," and operations teams become the catch-all for a process they don’t fully own.

To avoid this, organizations need a system that can credential at scale. An infrastructure built to flex with integrated file intake, delegated credentialing support (if applicable), and automatic routing for committee review. 

Enrollment is where revenue starts slipping

If credentialing is the first point of stress, payer enrollment is often where most revenue leakage begins. Even under stable conditions, enrollment with Medicare, Medicaid, and commercial payers is a slow, paperwork-heavy process. According to the Council for Affordable Quality Healthcare (CAQH), inefficiencies in provider data management cost the industry over $2 billion annually. When volume spikes after a closure, especially when displaced providers bring new state licenses or unfamiliar payer combinations, those inefficiencies multiply.

One common issue: enrollment packets often vary by payer, region, and facility. If your organization hasn’t standardized templates or automated packet generation, every new provider becomes a case-by-case project. It’s not just time-consuming - it increases the risk of missing documentation, incorrect taxonomy codes, and unapproved location pairings, all of which can delay reimbursement.

In a closure scenario, enrollment deadlines don’t shift to accommodate your surge. Providers may begin seeing patients, but without being properly enrolled, claims may be denied, held, or underpaid. In some systems, enrollment lag has led to revenue cycle delays of 90 days or more, eroding trust across departments and forcing teams into costly rework cycles.

To mitigate this, organizations should be investing in enrollment systems that tie directly into credentialing pipelines, support real-time eligibility checks, and proactively flag missing data before submission. The goal is to move without backtracking.

Provider onboarding turns into a deluge without a deadline

Provider onboarding is often where all operational complexity converges and it’s also where systems tend to break under pressure. Following a hospital closure, onboarding surges with urgency. This means you’re not just processing new hire paperwork but rather you’re managing licenses, work locations, affiliations, malpractice coverage, and payer-facing documentation all at once.

Under normal conditions, onboarding timelines range from two to four weeks. But when new providers enter under pressure — often with incomplete information or complex practice histories — that timeline can double. With over 83% of healthcare teams reporting moderate to high human involvement in provider onboarding, without automated intake or CAQH syncing, these teams are left spending precious time chasing down data, reviewing resumes manually, and emailing providers repeatedly for missing documentation. 

The human impact here is often underestimated. Ops teams spend nights and weekends patching together provider files that should have been systematized. Providers grow frustrated at the lack of clarity, and clinical leaders escalate delays. In these moments, onboarding transforms from a support function into a triage zone.

Managing a healthcare onboarding surge means balancing urgency with accuracy and few systems are equipped to do both under pressure. To help, centralized onboarding dashboards, simplified intake forms (e.g., collect only five key data fields to start), and real-time task tracking that allows for coordinated action across licensing, credentialing, and enrollment teams are excellent ways to add more signals and stay ahead.

Regulatory compliance is a silent risk that becomes visible

Compliance tracking is usually stable until it isn’t. After a closure, when intake volume spikes and systems are strained, it’s easy for credential expirations, license renewals, and board certifications to fall through the cracks. In a recent MGMA stat, more than 64% of practices reported struggling with staff bandwidth to track renewals and compliance deadlines even before accounting for external disruption.

The risk is reputational and practicing without a valid license or lapsed DEA registration creates real legal exposure. Missing a payer-mandated recredentialing window can result in delisting. And in delegated credentialing environments, audit findings from even one non-compliant file can jeopardize your status across the board.

In most health systems, compliance tracking is still done in spreadsheets or via manual alerts. That may be manageable for small, stable volumes. But when a wave of providers is added post-closure, many of whom are new to your state or payer network, manual systems start failing silently. As a result, for example, a month later, your compliance lead finds out a provider missed a license renewal deadline and you’re suddenly scrambling to mitigate the damage.

Modern compliance workflows include automated renewal reminders at 90/60/30 days, integrated sanction monitoring, and visibility across credentialing and enrollment functions - and create insurance against operational liability.

Building resilient credentialing and payer enrollment flows

Closures are rarely forecastable. But your operational response can be. Healthcare organizations that treat credentialing, enrollment and monitoring as a strategic asset (not a cost center) are the ones able to absorb disruption without chaos. It’s about building workflows and systems that respond under pressure and scale without rework.


What’s often misunderstood is that resilience doesn’t mean “getting it all right.” It means having the clarity, automation, and visibility to catch issues before they cost you trust, time, or revenue. It’s what allows you to onboard faster, submit cleaner enrollments, and stay compliant - even as everything around you shifts.


If you’re navigating these pressures in real time, or preparing your team for future closures, we recommend starting with the bigger picture.

Our first post in this series, 'The unseen crisis behind hospital closures and who bears the burden', explores how these events ripple through communities and what that means for the people holding the load.