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Can New Proposed Payment Models Remedy the Rural Healthcare Crisis?

Can New Proposed Payment Models Remedy the Rural Healthcare Crisis? EHR

“Without our hospital, how will our community survive? What will people do?”

Those were the first thoughts going through the mind of Lakeland Community Hospital’s Director of Lab Services Whitley Fowler, upon hearing that their hospital was slated to close in less than three months.

Through sheer determination and with outside support, the small Alabama community was able to save their rural hospital. However, many similar healthcare facilities across the country facing the same fate have found little recourse to battle mounting healthcare costs or simply have no idea where to look for help. NRHA (National Rural Health Association) hopes to shine a light on these issues in their upcoming Rural Hospital Innovation Summit, May 7 – 10.

Advocating for a Rural Healthcare Revival

Of the many subjects covered in this year’s Summit, a large focus will be placed on revising policies that are harmful to rural providers, as well as issues that may help stifle the financial bleeding of the rural healthcare sector. According to NRHA 46 percent of rural hospitals are operating at a loss, which is three percentage points up from one year ago. In fact, since 2010 more than 104 hospitals have closed their doors.

Aside from the loss of access to critical healthcare services, when a rural hospital closes, the economy for that area also takes a hit. A Health Services Research study showed that in specific rural areas where hospitals had closed, per capita income fell while unemployment rose.

The mounting cost of healthcare creates problems for both rural providers and the communities they serve. When patients can’t pay the hospital usually ends up footing the bill, a bleeding on both ends that often results in complete loss of care for those living in rural America.

While completely necessary, solving for the socioeconomic issues that create these conditions is a macro approach. The healthcare potential for rural populations can’t wait for such retroactive fixes. Solutions at a micro level need to happen now. Maggie Elehwany, Vice President of Government Affairs and Policy at NRHA, says what rural healthcare needs most is stability. She states the reinforcing that foundation for stability must start with the policymakers in Washington, but also needs support from within the industry.

The NRHA and members of the Pennsylvania Rural Health Initiative are two such entities helping lead the charge to address issues contributing to the rural healthcare crisis in America. Both these organizations offer prime examples as to how we can push rural-specific legislation and payment models into the forefront of Congress.

Pennsylvania Rural Health Model

Early in 2017, legislators and healthcare leaders in Pennsylvania initiated a rural-focused payment and healthcare delivery model designed to help support and sustain that class of hospital in the Keystone State.

The Pennsylvania Rural Health Model operates in a way that helps stabilize rural health through predictable budgetary controls. Based on predetermined inpatient/outpatient hospital-based service fees, the model would provide rural hospitals with monthly payments from a fixed “all-payer global budget.” In addition, as to optimize care, hospitals will redesign services in ways that best meet the needs of their community.

Ideally, the model will help hospitals provide the exact level of quality care their communities need without overextending expenditures across multiple payers. With increased financial viability on both ends—provider and payer—Pennsylvania rural hospitals could better ensure continued access to healthcare for their communities.

Save Rural Hospitals Act from NRHA

The Save Rural Hospital Act looks to stop significant reimbursement cuts from rural hospitals and create innovative care models that help stabilize these critical community centers. In addition, the authors of the Save Rural Hospital Act also hope this piece of legislation will create opportunities for rural hospital growth and allow them to develop new and existing facilities.

According to the NRHA there are two critical parts to the act: Relief through stability and the creating of a new and innovative rural care model.

Creating stability and relief mean revisions to various healthcare policies around Medicare and Medicaid, reimbursements, Meaningful Use compliance, and restrictions placed on CAH (critical access hospitals).

Innovation for future models will be driven by establishing a new Medicare payment designation, titled the Community Outpatient Hospital (COH). In addition, patients in rural or underserved areas could retain access to emergency care. As a result, hospitals could decide when and how to offer rural outpatient care that meets their community’s needs.

The legislation was introduced into the House in 2017 and is currently sitting with the Subcommittee on Health. For more detailed information on this piece of healthcare legislation visit the NRHA website.

Technologies for Sustainable Rural Healthcare

Rural and community hospitals are of vital importance to the entire population. Not only do these community centers provide close to 20 percent of the population with life-saving services, but they also play a major role in helping sustain economies that are the fabric of our nation. Grassroots advocacy is one of the best ways we can all work to make sure those living in rural areas can get the care they deserve.

Along with organizations like NRHA, healthcare EHR providers can also play a role in helping preserve and strengthen the rural sector. Along with partnering with organizations like NRHA, MEDHOST is dedicated to pioneering technology that places less operational and financial strain on rural hospitals. With effective policies in place and access to hospital technology tailored to their unique needs, we can raise awareness to help stop the bleeding on both ends—for rural hospitals and the people they serve.

Healthcare is better when we work together. Learn more about how MEDHOST is working with rural healthcare providers. Call 1.800.383.6278 or email us

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