HAP's Latest News

AHA Report Offers Solutions to Ensure Future of Rural Health

May 20, 2021

A report released this week from the American Hospital Association (AHA) offers solutions to ensure the future of the nation’s rural hospitals and puts a spotlight on Pennsylvania’s Rural Health Model as one promising approach to transform care.

The nation’s rural hospitals face significant challenges—such as negative operating margins, unpredictable patient volumes, and workforce shortages—but innovative approaches to payment and delivery can help ensure access to care for 60 million rural residents across the U.S., the AHA’s Rural Health Care Task Force said.

“Working together on local, state and federal levels, we can transform rural health care into being what it always could and should have been: a powerful force not only for addressing the medical needs of our rural patients, but for achieving optimal health in rural communities,” the report says.

The AHA report focuses on four key strategies to support rural health:

  • Public-private funding for core services:  New funding approaches from public and private payors can ensure essential services are available in rural communities
  • Flexible funding to support infrastructure transformation:  Funding from community development financial groups, government programs, and philanthropic organizations can help hospitals invest in their infrastructure
  • Create a rural design center within the Centers for Medicare and Medicaid Innovation:  Rural hospitals should be encouraged to participate in innovative payment delivery models. Barriers related to patient volume thresholds and other requirements can hinder their access to federal programs
  • Grant-writing gig economy:  Rural hospitals need support connecting with qualified grant writers who can help them secure funding for needed services and programs

The report highlights Pennsylvania’s Rural Health Model for its potential to improve care, control costs, and provide stability to rural hospitals. Implemented during 2019, the Pennsylvania Rural Health Model provides rural hospitals with a consistent, upfront revenue source to plan their budgets and invest in innovative programs to improve community health.

Pennsylvania’s rural hospitals are using this funding to increase access to primary care, manage patients with complex chronic diseases, and address the opioid crisis within their communities, among other initiatives. To date, the program includes 18 rural hospitals and six payors. Recruitment is currently underway for 2022.

The AHA report notes that global budget models have the potential to offer “more predictable, stable funding that lets providers focus on providing the right care to the right patient.” The report suggests that global budget models may work best with broad provider participation, a mix of public and private payors, and appropriate quality measures to assess outcomes.

HAP applauds Pennsylvania’s rural hospitals for their outstanding care and will continue to advocate for policy initiatives that ensure their stability in the communities they serve. 

For more information about Pennsylvania’s Rural Health Model, contact Kate Slatt, HAP’s vice president, innovative payment and care delivery, or Laura Stevens Kent, HAP’s senior vice president, strategic integration.