January 14, 2016
Health care is undergoing a major transformation as we move from a volume-based model of care to a value-based model. The Triple Aim focus of improved patient experience, population health, and reduced health care costs is appropriate. But not every hospital can get to the destination at the same pace or even in the same way. The challenge is greatest for small, rural providers.
According to the Rural Health Association, 48 small town hospitals have closed since 2010 and hundreds more are at risk of closure, unable to weather what has been called "the punishment of a changing national health care environment." As a veteran health care administrator, I am very concerned about the potential impact on access to care for the disproportionately high percentages of elderly and uninsured patients who live in rural areas.
There is not another hospital across town to choose from when a rural community hospital fails. When hospitals close or are forced to scale back essential health care services, or when facility failures occur in rural communities, the result is "elimination," not "reduction" in access. The result is long trips—often as much as an hour or more—for treatment, and uncertainty during health emergencies.
The funding crisis facing rural health care is multifactorial and includes declining federal reimbursements under the Affordable Care Act, reduction in special disproportionate share Medicaid payments, and sequestration (the across-the-board budget cut that arose out of the legislative partisanship).
Additionally, rural hospitals suffer from multiple endemic disadvantages that exacerbate the situation, driving down profit margins, and making it virtually impossible to achieve economies of scale. These include declining populations; disproportionate numbers of elderly and uninsured patients; the frequent need to pay doctors better than top dollar to get them to work in underserved rural communities; the cost of expensive equipment that is necessary, but frequently underused; the inability to provide lucrative specialty services and treatments with healthy profit margins; and an emphasis on emergency and urgent care, which are chronic money-losers.
So what needs to be done? Policymakers need to advance policies that improve health care access and efficiencies. For example:
Rural hospital leaders will have a far greater opportunity to chart a successful course for the future, and ensure that the health care needs of our communities are met, if health care policies align with the transformation taking place.
Tags: Workforce | Quality Initiatives | Federal Advocacy | State Advocacy | Regulatory Advocacy | Health IT | Value-based Care | Rural Health Care
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