Leg­is­la­tion Lan­guishes as ru­ral hos­pi­tals strug­gle

Modern Healthcare - - POST-ACUTE CARE - By Shan­non Much­more

Much of ru­ral Amer­ica al­ready re­sem­bles the coun­try’s fu­ture—it’s older and sicker.

Take Page County at the north­ern edge of Vir­ginia’s his­toric Shenan­doah Val­ley, for in­stance. De­spite its prox­im­ity to the na­tion’s cap­i­tal, the pop­u­la­tion over age 65 has in­creased by 28% to about 1 in 5 res­i­dents over the past decade. The poverty rate in the county of about 24,000 is up 21%. And un­em­ploy­ment stands at 6.9%, sig­nif­i­cantly higher than the na­tional av­er­age.

Ac­cess to healthcare for its ag­ing pop­u­la­tion is cru­cial, lo­cal of­fi­cials say. And, lucky for lo­cal res­i­dents, they still have the 25-bed crit­i­cal-ac­cess Page Me­mo­rial Hos­pi­tal, lo­cated in the county seat of Lu­ray. With­out it, res­i­dents would have to drive at least 45 min­utes to an emer­gency room or for pri­mary and pre­ven­tive care.

But the hos­pi­tal’s fu­ture is threat­ened by the on­go­ing cuts to Medi­care and the fail­ure of the state to ex­pand Med­i­caid, of­fi­cials say. “If you de­cide to live in a ru­ral com­mu­nity, are you de­cid­ing to have a worse out­come if you have a stroke?” asked Dr. Jeff Feit, vice pres­i­dent of pop­u­la­tion health at the Val­ley Health sys­tem, which man­ages the hos­pi­tal and five oth­ers along the Vir­ginia and West Vir­ginia bor­der.

While the Af­ford­able Care Act has al­lowed mil­lions to gain ac­cess to health in­sur­ance, ru­ral hos­pi­tals con­tinue to face re­im­burse­ment cuts and prac­tice-of-medicine reg­u­la­tions that ad­min­is­tra­tors say do more harm than good. In the U.S., nearly 2,000 hos­pi­tals are ru­ral and 1,333 qual­ify as crit­i­cal ac­cess.

While the over­all num­ber of crit­i­cal-ac­cess hos­pi­tals did not shrink over the past year (see this week’s By The Num­bers on p. 34), there has been a steady drum­beat of clos­ings over the past few years, leav­ing hun­dreds of thou­sands of pa­tients with lim­ited ac­cess to ser­vices, ad­vo­cates for ru­ral hos­pi­tals say.

Fed­eral bills have been in­tro­duced this ses­sion in both cham­bers that would help ru­ral hos­pi­tals, some with bi­par­ti­san sup­port. But they have re­ceived lit­tle at­ten­tion in Congress and have al­most no chance of pas­sage.

Travis Clark, pres­i­dent of Page Me­mo­rial, said the fed­eral gov­ern­ment has helped hos­pi­tals such as his in the past. But they are now in need of spe­cial pro­grams and grants that will al­low ru­ral providers to do more than just sur­vive. “We need to make them strong,” he said.

With­out ac­tion, their strug­gles con­tinue. In mid-Septem­ber, a 75-bed hos­pi­tal in ru­ral south­east Kansas an­nounced it would be­gin a phased clo­sure on Oct. 10. Mercy Hos­pi­tal In­de­pen­dence is hop­ing to keep some ser­vices avail­able, such as pri­mary care, hos­pice and home health.

There could also be a free-

stand­ing emer­gency room, but that could pose fi­nan­cial hur­dles un­less it is provider-based. ERs that are not provider-based re­ceive less re­im­burse­ment for ser­vices, said Kansas Rep. Jim Kelly, chair­man of the Mercy In­de­pen­dence board of di­rec­tors.

The Kansas Hos­pi­tal As­so­ci­a­tion has re­peat­edly told law­mak­ers that fail­ure to ex­pand Med­i­caid is hav­ing dire con­se­quences, in­clud­ing the clos­ing of hos­pi­tals. Mercy In­de­pen­dence would re­ceive about $1.6 mil­lion more in one year if the state ex­pands. Yet Gov. Sam Brown­back has re­fused to budge.

Mag­gie Ele­hwany, vice pres­i­dent of gov­ern­ment af­fairs for the Na­tional Ru­ral Health As­so­ci­a­tion, said sig­nif­i­cant Med­i­caid cuts in the past few years have been suf­fo­cat­ing ru­ral hos­pi­tals. Since 2010, 55 ru­ral hos­pi­tals have closed and that rate is es­ca­lat­ing. More than 280 re­port be­ing at the edge of clo­sure. In 2013, more than one-third of ru­ral hos­pi­tals were op­er­at­ing at a deficit, she said.

“The great­est cri­sis right now is the hos­pi­tal clo­sure is­sue,” she said.

The worst fi­nan­cial hits have come from cuts to Medi­care’s bad-debt pro­gram and dis­pro­por­tion­ate-share hos­pi­tal pay­ments. Se­ques­tra­tion, which slapped a 2% across-the-board cut on Medi­care pay­ments, hit ru­ral ar­eas with their older pop­u­la­tions es­pe­cially hard. Ru­ral hos­pi­tals rarely have the op­tion of shift­ing costs to the pri­vately in­sured. “It’s very dif­fer­ent if not im­pos­si­ble for them to make up that dif­fer­ence with other meth­ods,” she said.

The 20 states that have not yet ex­panded Med­i­caid el­i­gi­bil­ity un­der the ACA tend to be more ru­ral states with Repub­li­can gover­nors. These states also have res­i­dents who tend to be older, poorer and sicker, Ele­hwany said.

While there is bi­par­ti­san sup­port for help­ing ru­ral hos­pi­tals, their pleas haven’t got­ten much trac­tion with con­gres­sional lead­ers. The Save Ru­ral Hos­pi­tals Act, in­tro­duced in the House in July by Reps. Sam Graves (R-Mo.) and David Loeb­sack (D-Iowa), would roll back the Med­i­caid bad debt and dis­pro­por­tion­ate-share hos­pi­tal pay cuts.

It also would re­lax physi­cian su­per­vi­sion re­quire­ments, which have come un­der crit­i­cism from ru­ral hos­pi­tal of­fi­cials hav­ing dif­fi­cul­ties at­tract­ing li­censed prac­ti­tion­ers. The reg­u­la­tions, present in most states, say a li­censed physi­cian must su­per­vise rou­tine med­i­cal pro­ce­dures that could be per­formed safely by nurses and physi­cian as­sis­tants.

Healthcare lob­by­ist Eric Zim­mer­man, an at­tor­ney at McDer­mott Will & Emery with nu­mer­ous healthcare clients in­clud­ing the re­cently formed Medi­care De­pen­dent Ru­ral Hos­pi­tal Coali­tion, said it is un­likely Congress will take ma­jor ac­tion this ses­sion to save ru­ral hos­pi­tals. With the an­nual doc-fix leg­is­la­tion no longer in play, leg­is­la­tors fight­ing for spe­cial in­ter­ests such as ru­ral hos­pi­tals no longer have a “must pass” leg­isla­tive ve­hi­cle for pur­su­ing de­sired healthcare changes.

And they get no sup­port from the White House. The Obama ad­min­is­tra­tion has pro­posed tight­en­ing the def­i­ni­tion of a crit­i­cal-ac­cess hos­pi­tal and cut­ting their re­im­burse­ments, which are cur­rently slightly higher than other hos­pi­tals.

Se­nate Repub­li­cans are pur­su­ing their own agenda for ru­ral hos­pi­tals. Rep. Chuck Grass­ley (R-Iowa) in­tro­duced the Ru­ral Emer­gency Acute Care Hos­pi­tal Act, which would cre­ate a new Medi­care pay­ment des­ig­na­tion for “ru­ral emer­gency hos­pi­tals.” They would be re­quired to pro­vide emer­gency care 24/7 and ob­ser­va­tional care for some cases. They would re­ceive 110% of nor­mal re­im­burse­ment, a 9 per­cent­age-point bump.

“In­stead of let­ting these fa­cil­i­ties close be­cause they don’t have the needed in­pa­tient vol­ume to gen­er­ate enough rev­enue, why not let go of the un­der­uti­lized in­pa­tient ser­vices in fa­vor of sus­tain­ing life-sav­ing emer­gency care,” Grass­ley said in in­tro­duc­ing the bill. “The REACH Act … en­sures res­i­dents have ac­cess to the emer­gency med­i­cal care that saves lives.”

The crit­i­cal-ac­cess hos­pi­tal des­ig­na­tion was cre­ated in the 1997 Bal­anced Bud­get Act be­cause of a string of ru­ral hos­pi­tals clo­sures in the 1980s and early 1990s. The hos­pi­tals strug­gled with Medi­care’s new prac­tice of pay­ing hos­pi­tals a set amount per pro­ce­dure, in­stead of what­ever the hos­pi­tal said treat­ment cost.

Crit­i­cal-ac­cess hos­pi­tals must have 25 or fewer beds and be 35 miles away from another hos­pi­tal. They re­ceive re­im­burse­ment of rea­son­able costs plus 1%.

The ACA aimed to do away with some of the pay­ment des­ig­na­tions, rea­son­ing that the large in­crease in peo­ple who have health in­sur­ance would off­set the other prob­lems. When the U.S. Supreme Court said states could not be forced to ex­pand Med­i­caid, many of those peo­ple were once again shut out from cov­er­age.

Zim­mer­man said Congress will have trou­ble find­ing the funds for ma­jor re­form or rolling back cuts from the ACA. Keith Mueller, di­rec­tor of the Ru­ral Pol­icy Re­search In­sti­tute’s Cen­ter for Ru­ral Health Pol­icy Anal­y­sis, said the REACH Act would take more time to im­ple­ment be­cause it cre­ates a new pro­gram. Ru­ral hos­pi­tals are look­ing for more im­me­di­ate ways to keep at least some ser­vices avail­able.

Ru­ral hos­pi­tals are vi­tal to their lo­cal economies. The Na­tional Ru­ral Health As­so­ci­a­tion claims that clos­ing the 283 most vul­ner­a­ble ru­ral hos­pi­tals would elim­i­nate 36,000 healthcare jobs and an ad­di­tional 50,000 jobs in the com­mu­nity would be at risk. Those cuts would re­sult in a $10.6 bil­lion loss to the gross do­mes­tic prod­uct.

Clark said Page Me­mo­rial Hos­pi­tal em­ploys nearly 200 peo­ple and has a $40 mil­lion im­pact on the county.

Mueller said more pri­mary-care and men­tal health providers are des­per­ately needed in ru­ral ar­eas with short­ages. “The high pri­or­ity is ev­ery­thing re­lated to the healthcare

“If you de­cide to live in a ru­ral com­mu­nity, are you de­cid­ing to have a worse out­come if you have a stroke?”

Dr. Jeff Feit Vice pres­i­dent of pop­u­la­tion health Val­ley Health

work­force,” he said. “That drives ev­ery­thing.”

Des­per­ate for al­ter­na­tives, some doc­tors and ru­ral hos­pi­tal ad­min­is­tra­tors see tele­health as an op­tion to ac­cess healthcare in ru­ral ar­eas. Dr. Michael Meza, who has been a fam­ily prac­tice physi­cian in north-cen­tral Idaho for 20 years, started in­cor­po­rat­ing telemedicine ser­vices when he saw his pa­tients trav­el­ing long dis­tances for spe­cialty care, of­ten af­ter wait­ing months for an ap­point­ment.

To deal with the lack of psy­chi­atric ser­vices and the fact that some of his pa­tients have dif­fi­culty ac­cess­ing spe­cialty care, he cre­ated a telemedicine op­er­a­tion so that pa­tients could re­ceive timely care with­out tak­ing days off work or school for travel. “It could be a god­send to some of these small hos­pi­tals and com­mu­ni­ties,” he said.

Tele­health ser­vices have unique bar­ri­ers, though. Some ru­ral com­mu­ni­ties do not have the high-speed In­ter­net con­nec­tion needed for video­con­fer­enc­ing. And some physi­cians are un­will­ing to make telemedicine re­fer­rals, he said.

Also, some or­ga­ni­za­tions may have to reach across state lines to find a provider, which presents li­cens­ing, pa­tient pri­vacy and se­cu­rity chal­lenges. Elec­tronic health records need to be sharable with a va­ri­ety of prac­tices as well, Meza said.

Shan­non Sorensen, CEO of Brown County Hos­pi­tal in Ainsworth, Neb., said her hos­pi­tal is in the black and meet­ing the needs of the com­mu­nity, but is strug­gling to cope with the in­creased reg­u­la­tory bur­dens.

The clos­est hos­pi­tal is 150 miles away, which means even by he­li­copter it takes an hour to reach other healthcare providers. The 23-bed crit­i­cal-ac­cess fa­cil­ity is vi­tal to res­i­dents who need pre­ven­tive or emer­gency ser­vices, she said.

Sorensen called for get­ting rid of the 96-hour rule dur­ing a July con­gres­sional hear­ing; the rule re­quires a physi­cian to cer­tify that a ben­e­fi­ciary will be re­leased or trans­ferred within 96 hours of ad­mis­sion. If the con­di­tion is not met, the hos­pi­tal faces non­pay­ment.

She also at­tacked physi­cian su­per­vi­sion re­quire­ments for rou­tine pro­ce­dures and the two-mid­night rule, which strictly de­fines in­pa­tient hos­pi­tal stays. “Hav­ing to fo­cus on reg­u­la­tory bur­dens in­ter­feres with the best judg­ment of physi­cians and other healthcare providers, plac­ing them in a po­si­tion where highly qual­i­fied lo­cal providers can­not pro­vide care for their pa­tients,” she told law­mak­ers.

In an in­ter­view, Sorensen said the reg­u­la­tions are ar­bi­trary and a dis­trac­tion for doc­tors who would rather fo­cus on the health of a pa­tient. “It’s the world of medicine, not an ex­act science,” she said.

The hos­pi­tal is small but has a lot of tech­ni­cal re­sources. Phar­ma­cists and emer­gency doc­tors are avail­able for con­sults at the push of a but­ton and tele­health ser­vices are on­site, she said.

“We can’t be ev­ery­thing to ev­ery­one. We rec­og­nize that,” she said. “We need to be re­ally good at what we can do.”

The fu­ture of Vir­ginia’s Page Me­mo­rial Hos­pi­tal is threat­ened by the on­go­ing cuts to Medi­care and the fail­ure of the state to ex­pand Med­i­caid, of­fi­cials say.

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