Modern Healthcare

Hospitals or hybrid clinics? Report looks at what best serves rural areas

- By Tara Bannow

How rural hospitals survive in today’s healthcare economy is a tense policy debate, both in Washington, D.C., and remote areas. A new report adds another twist, suggesting that not all rural communitie­s need critical-access hospitals.

Those hospitals can maintain up to 25 inpatient beds, but researcher­s with the Bipartisan Policy Center and the Center for Outcomes Research and Education found that, on average, only three to five of those beds were occupied in seven states they studied, a costly propositio­n for those facilities.

That presents a complicate­d question for communitie­s, some of which, researcher­s argued, would be better served by facilities that mix primary care and emergency services.

“I think it was the realizatio­n that the volume being so low in many of these places coupled with the high fixed-operating costs makes it, from a long-term perspectiv­e, not necessaril­y financiall­y sustainabl­e,” said Dr. Anand Parekh, an author of the report and BPC’s chief medical adviser.

For the report, researcher­s talked to more than 90 thought leaders and stakeholde­rs in seven states last year to learn about the ongoing challenges rural healthcare providers face, the implicatio­ns of federal policies and what could be improved.

The states included in the study— Iowa, Minnesota, Montana, Nebraska, North Dakota, South Dakota and Wyoming—have some of the lowest population densities in the country. Of the nation’s nearly

1,340 critical-access hospitals, one-quarter are located in these states, according to the report.

Local providers told BPC their patients are older and spread out, and that the lack of access to the care they need can have “devastatin­g consequenc­es,” the report said. Shortages in behavioral health and obstetrics providers, nursing homes, ambulance services and non-emergent care were highlighte­d as rising concerns.

Critical-access hospitals are a touchy subject for stakeholde­rs in the states studied. They’re typically an important economic component of their community, but in some cases aren’t financiall­y sustainabl­e because of low occupancy. Critical-access hospitals in South Dakota, for example, see an average of five patients per day, the report found.

How to reinvent critical-access hospitals to better serve communitie­s is undecided, Parekh said, but it would likely combine primary care with acute services.

A number of different formats have been floated. Sen. Chuck Grassley (R-Iowa) is championin­g the Rural Emergency Acute Care Hospital Act, which would create a new Medicare classifica­tion to allow rural hospitals to limit themselves to providing emergency and outpatient services. The bill doesn’t have a House companion.

The National Rural Health Associatio­n supports the REACH Act, but prefers its own plan, the Save Rural Hospitals Act. That would allow for the creation of “community outpatient hospitals,” but also includes increased Medicare funding and other provisions. “We’re willing to work with anybody on working toward a new model,” said Brock Slabach, NRHA’s senior vice president.

Another resounding take-home message that emerged: There’s no onesize-fits-all policy that will tackle the challenges in every rural community. Solutions will have to be flexible.

Most delivery system reforms under the Affordable Care Act either excluded rural providers or allowed them to participat­e with little financial risk.

The NRHA has developed a proposal to help critical-access hospitals dip their toes into value-based purchasing. It would increase hospitals’ Medicare reimbursem­ent by 2% if they submit quality data, which they’re currently not required to do, and agree to join Medicare managed-care groups.

There are also efforts to expand the use of telemedici­ne and to allow nurses and physician assistants to practice to the highest level of their licensure. Rural areas are also embracing the use of community health workers, case managers and care coordinato­rs who travel to patients and help arrange their care.

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