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Report looks at why rural hospitals are closing

FierceHealthcare reports:

“The number of U.S. rural hospitals that shut their doors reached a record-setting 19 last year, according to a new report that aims to pinpoint why hospitals are closing.

“The Chartis Center for Rural Health and iVantage Health Analytics released a report (PDF) … that found 120 rural facilities have shut their doors since 2010. The study also explored indicators that can lead to a rural hospital’s demise.

“’The accelerated rate at which rural hospitals are closing continues to unsettle the rural healthcare community and demands a more nuanced investigation into rural hospital performance,’ the study said.”

“The report identified nine indicators to measure whether a hospital is ripe for closure. Some of the indicators include occupancy rates, age of the facility, system affiliation, total revenue and case mix index, which is the ability to handle a broad mix of services.”

“Another key indicator is whether the state expanded Medicaid under the Affordable Care Act.”

To read the whole article, please hit this link.

The health-system gaps within rural areas

In the Texas Hill Country.

Shao-Chee Sim, Ph.D., vice president for applied research of the Episcopal Health Foundation, writes in Health Affairs that a major problem of American healthcare is not just the “health gap widening between urban and rural areas. There’s also a growing gap between the way systems of health work in different areas of the country” — including gaps between how hospital systems work within the same rural areas.

For those who need to understand this, Dr. Sim pointed to the recently released   report by the Rural and Community Health Institute (RCHI) at Texas A&M University called “What’s Next? Practical Suggestions for Rural Communities Facing a Hospital Closure.” He calls it  “a powerful narrative on the opportunities for rural communities to optimize their healthcare delivery systems in the face of hospital closures.”

“The RCHI team challenges conventional policy conversations and goes beyond solely focusing on a community losing a hospital. Instead, the authors look at the problem through a geographic lens and focus on what are the available health resources in the affected areas. The report finds that a regional approach is key to developing healthcare alternatives for rural communities, such as expanding telemedicine options, converting a former hospital into a freestanding emergency department, or establishing new rural health clinics.”

To read the piece, please hit this link.

Md. program helps rural hospitals


garrettGarrett County Regional Medical Center, in Oakland, Md., one of the hospitals in the state’s program.

HealthcareDIVE looks at how Maryland has been helping its rural hospitals weather reimbursement   challenges through implementing implementing an alternative approach to managing rising hospital costs: the total patient revenue (TPR) program.

TPR, created by the Maryland Health Services Cost Review Commission (HSCRC),  gives “hospitals a financial incentive to change the way they manage their resources, with the ultimate goal of slowing down cost increases while preserving the quality of care. Maryland already regulates charges in all the state’s acute care hospitals, but TPR takes it a step farther.’’

The news service says that HSCRC “examines a hospital’s patient mix and services and sets the amount of revenue that a hospital will get each year from the patients in its service area. At the beginning of each year, the hospital knows what its total revenue that year will be. The amount of revenue may be adjusted annually to take into consideration changes in the community, changes in service levels or shifting of services to other settings.’’

“Hospitals are encouraged to focus on improving care and managing health at the community level. They are financially motivated to control lengths of stay, reduce unnecessary testing, prevent inappropriate admissions, and generally operate in a more efficient manner. They are also incentivized to reduce readmissions, a strong motivator for careful patient education and post-discharge follow-up.’’

“TPR has been introduced slowly and only to sole community provider hospitals and hospitals in areas of the state that do not have ‘densely overlapping’ service areas – rural hospitals, essentially.’’

To read more, please hit this link.


Looking at the new CMS-Pennsylvania model for improving rural hospitals


Farm in Lancaster County, Penn., where many Amish people live.

CMS and Pennsylvania are  collaborating on a new model to improve health and healthcare is rural areas of the state.

Here are  Becker’s Hospital Review’s “eight things to know about the model”:

1. The Pennsylvania Rural Health Model is being administered through the CMS Innovation Center and  the state’s health department.

2. The goal  “is not only to improve health and healthcare in rural areas of Pennsylvania, but also to reduce the growth of hospital expenditures across payers — including Medicare — and improve the financial viability of the state’s rural hospitals, according to CMS.”

3. “The model is broken up into seven performance years, according to CMS. It  began  Jan. 12, 2017 and will end Dec. 31, 2023.”

4. “CMS said Pennsylvania rural hospitals participating in the model will receive all-payer global budgets — funded by all participating payers — to cover inpatient and outpatient services they provide. In exchange, these hospitals will use the money ‘to deliberately redesign the care they deliver to improve quality and meet the health needs of their local communities,’ the agency added”.

5. ”Pennsylvania, during each performance year, will prospectively set the all-payer global budget for each participating hospital, CMS said. The all-payer global budget will primarily be based on hospitals’ historical net revenue for inpatient and outpatient hospital-based services from all participating payers, according to CMS.”

6. ”Participating hospitals will also detail a plan to improve care quality by preparing a Rural Hospital Transformation Plan that must be approved by Pennsylvania and CMS.”

7. ”CMS said it will provide Pennsylvania with $25 million, which is a portion of the funding to begin implementing the model”.

8. Any critical-access hospital or acute-care hospital in rural Pennsylvania may participate in the model.

To read the CMS report on the model, please hit this link.

For more information from Becker’s, please hit this link.


These rural hospitals expanded their way to prosperity


While rural hospitals have been closing  at an accelerating rate all over America, there are some that have been doing very well despite clinical, regulatory and reimbursement challenges facing the sector. They do it by expanding, of all things.

One, reports STAT, is the  39-bed public, nonprofit Childress (Texas) Regional Medical Center, which has  a positive bottom line on its annual operating budget of $28 million. The facility, unlike  many, perhaps most, rural hospitals is expanding clinical services, including telemedicine,  and increasing the number of its physicians and the hours at its primary-care clinic.

Included in the expansion: In 2013 it added an orthopedic surgeon so that the facility no longer has to transfer patients 200 miles away if they need an orthopedic operation. Then there’s the oncologist from the Texas Tech University Health Sciences Center, in Lubbock, who comes once a month to see patients at Childress. Also, specialists in urology and cardiology visit the facility at least once a month to see patients.

Telemedicine lets  physicians  consult with specialists at Children’s Medical Center in Dallas about complex cases. And Childress recently bought another telemedicine unit for its outpatient primary-care clinic to let its physicians consult with Lubbock-based cardiologists and psychiatrists.

To read the STAT report, please hit this link.

The Childress story of how expanding rather than hunkering down can spawn success reminds us of a 2015 article in  FierceHealthcare that says, among other things:

“Four years ago, Putnam County Memorial Hospital in Unionville, Missouri, faced a major budget deficit while struggling to provide care for a largely uninsured, elderly and low-income patient population. Reducing staff seemed like the obvious solution, but this would have put the organization at even more of a disadvantage in terms of the care it could provide. Rather than cut back, Putnam County Memorial decided to go bigger, turning a 10-bed unit into a psychiatric unit and later recruiting specialists in anesthesiology, cardiology and gynecological services. After they added these new services, revenues climbed to $22 million, and average patient volume per day increased from fewer than one to more than 12.

“As unlikely as the expansion strategy seems, it could benefit other rural facilities as well, according to the Rural Policy Research Institute. ‘We think that’s the way forward for rural hospitals, rather than just sort of a bunker mentality–saying that we can’t proceed,’  Tim McBride, a healthcare expert with the institute, told National Public Radio.”

To read the FierceHealthcare article, please hit this link.

The advantages of rural hospitals


St. James Parish Hospital, in Lutcher, La.

MaryEllen Pratt, writing in Hospitals & Health Networks, touts rural hospitals. As well she would: She’s the CEO of St. James Parish Hospital, in Lutcher, La., and chairwoman of the American Hospital Association’s Small or Rural Governing Council.

She summarizes  her views at the end of her essay:

“{R}ural hospitals have the unique capacity to provide patients with the ‘best of both worlds.’ Rural hospitals are large enough to offer top technology and small enough to talk you through your tests. They are large enough to attract a wide range of specialists, but small enough to offer same-day appointments. They are large enough to compete nationally in regard to quality, but small enough to know your name. Proud to serve our communities, rural hospitals are “Large enough to serve, Small enough to care.”

To read her essay, please hit this link.

Cutting out the healthcare middlemen


The Grand Bazaar in Istanbul.

Herewith five areas of healthcare ready to cut out all or some of the middlemen:

“In fact, the perfect storm is brewing in healthcare for disintermediation right now.” reports Becker’s Hospital Review in an interview with Paul Keckley, Ph.D., managing editor of  The Keckley Report.

“{T]hree forces — large health systems, pharmaceutical retailers and major payers — are perfectly positioned to knock out a few layers of the healthcare food chain.”

1. Drug companies. There may be a quicker and cheaper way for patients to obtain pharmaceutical drugs, such as through direct sales to consumers. However, this is not a one-size-fits-all projection, Mr. Keckley told Becker’s.

2. Rural hospitals.  Big regional health systems will put rural providers into networks and move capital from inpatient acute care to skilled nursing, rehab and primary care. Telehealth will help connect specialists in urban and suburban areas with rural primary- care providers.

3. Academic medical centers: They will face many more competitors with lower costs as healthcare price-and-quality transparency increases. Patients are finding that they can get care  at the nonacademic hospitals that’s as good  as that at teaching hospitals. But who will protect the research mission?

4. Private insurers. They’ll have to compete with more and more health systems offering their own insurance plans to their patients and their families.

5. Physicians. Consumers want more access, engagement and transparency. They’re also less attached to  specific physicians and more open to non-physician clinicians, retail clinics and other venues that make care more convenient and often cheaper than going to U.S. physicians, who remain by far the world’s highest paid.

Some struggling rural hospitals close labor/delivery units


Allegheny Memorial Hospital.


For Kaiser Health News

A few years ago, when a young woman delivered her baby at Alleghany Memorial Hospital, in Sparta, N.C., it was in the middle of a Valentine’s Day ice storm and the mountain roads out of town were impassable. The delivery was routine, but the baby girl had trouble breathing because her lungs weren’t fully developed. Dr. Maureen Murphy, the family physician who delivered her that night, stayed in touch with the neonatal intensive-care unit at Wake Forest Baptist Medical Center, in Winston-Salem,  N.C., a 90-minute drive away, to consult on treatment for the infant.

“It was kind of scary for a while,” Murphy remembered. But with Murphy and two other family physicians trained in obstetrics as well as experienced nurses staffing the 25-bed hospital’s labor and delivery unit, the situation was manageable, and both mother and baby were fine.

newborn_baby_hospital_770Things are different now. Alleghany hospital — like a growing number of rural hospitals — has shuttered its labor and delivery unit, and pregnant women have to travel either to Winston-Salem or to Galax, Va.,  about 30 minutes away by car, weather permitting.

“It’s a long drive for prenatal care visits, and if they have a fast labor” it could be problematic, said Murphy, who teaches at the Cabarrus Family Medicine Residency Program, in Concord, N.C. (Although not essential, women typically see the physician they expect will handle their delivery for prenatal care.)

About 500,000 women give birth each year in rural hospitals, yet access to labor and delivery units has been declining. Comprehensive figures are spotty, but an analysis of 306 rural hospitals in nine states with large rural populations found that 7.2 percent closed their obstetrics units between 2010 and 2014.

“The fact that closures continue happening — over time that means the nearest hospital gets further and further away,” said Katy Kozhimannil, an associate professor at the University of Minnesota School of Public Health, who co-authored the study published in the January issue of Health Services Research.

There are many factors that contribute to the decline in rural hospital obstetrics services. For one thing, obstetrics units are expensive to operate, and a small rural hospital may deliver fewer than 100 babies a year.

“A labor and delivery unit is functionally no different than an intensive care unit,” said Dr. Neel Shah, an assistant professor of obstetrics, gynecology and reproductive biology at  the Harvard Medical School. Staffing levels are high in obstetrics, often one nurse for every patient, and the rooms are cluttered with monitors, infusion pumps and other equipment.

It can be difficult to staff the units as well. Small rural hospitals may not have obstetricians on staff and rely instead on local family physicians, but it can be difficult to get enough to fully provide services for a hospital, too. Nurses with obstetrics experience also can be scarce.

Meanwhile, bringing in the revenue needed to cover the costs involved in maintaining the units can be difficult because insurance payments are often low. Medicaid pays for slightly under half of all births in the United States, but in rural areas the proportion is often higher, said Kozhimannil. Since Medicaid pays about half as much as private insurance for childbirth, “the financial aspect of keeping a labor and delivery unit open is harder in rural areas,” she said.

Advocates say there are a number of initiatives that could help bolster labor and delivery services in rural areas.

Encouraging medical professionals to move to rural areas is key, they say. A bipartisan bill introduced in Congress last year, for example, would require the federal government to designate maternity care health professional shortage areas. Such designations exist for primary care, mental health and dental care. The National Health Services Corps awards scholarships and provides loan repayment to primary-care providers who commit to serving for at least two years in designated shortage area. Once they get to a community and put down some roots, the hope is they’ll stay.

Expanding the use of midwives and birthing centers could be cost effective since they are generally less expensive than physicians and hospital obstetric units. Although birthing centers and home births are on the rise, more than 98 percent of the 4 million babies that were born in 2014 made their arrival at a hospital.

“You can deal with lower volume and still be sustainable,” said Shah.

“Finding strength in numbers, small rural hospitals are increasingly banding together to share resources, said Kozhimannil. For example, since it’s difficult to keep rural staff trained in rare complications, small rural hospitals sometimes pool resources to buy a mobile simulation unit to train people on handling postpartum hemorrhage, the leading cause of maternal mortality.

Kozhimannil sees great opportunity in the ongoing national dialogue about health reform but says much of the research to date has focused on reforming health care in urban settings.

“That’s why it’s crucial to have rural people at the table,” she said

Metrics of troubled rural hospitals


iVantage Health Analytics finds some similar problems among rural hospitals vulnerable to closure.

As nicely summarized by Becker’s Hospital Review:

“iVantage  compiles a hospital-strength index based on data about financial stability, patients and quality indicators.

1. “The strength index is based on a composite measure of nine pillars of hospital strength: inpatient share ranking, outpatient share ranking, population risk, cost, charge, quality, outcomes, patient perspectives and financial stability. The hospitals at risk of closure underperform in a majority of the areas evaluated, with the median vulnerable hospital earning an overall score of 16.22 out of a possible 100.

2. “Of hospitals at risk of closure, the median score in the patient perspectives area — a rating of hospital performance based on the percentile ranking of a number of HCAHPS measures — was 26/100.

3. “Hospitals vulnerable to closure struggle in the area of population risk, as they serve especially sick, expensive and challenged populations, according to the analysis. With regard to population risk, the median score was 30/100.

4. “As expected, vulnerable rural hospitals face challenges with inpatient market share, with a median score of 29/100 in that area. The median score was nearly the same in the area of outpatient care.

5. “The hospitals face significant challenges with outcomes and quality, with median scores of 28/100 and 30/100 in those areas, respectively.

6. “The median vulnerable hospital scored 27/100 in the area of financial stability.”

Looking for good rural-hospital trustees


Hospitals & Health Networks looks at the pressures facing the trustees of  nonprofit rural hospitals, noting that, among other challenges:

• “Rural hospitals face growing pressures on multiple fronts, including reimbursement changes tied to value-based payments and raising concerns about health care access in rural communities.

• “These pressures are forcing greater demands on rural hospital trustees, who must make ever more complex decisions about service lines and whether to affiliate with larger health systems.

• “Greater demands on rural hospital boards means that more than ever, rural hospitals need trustees who are knowledgeable about the latest hospital industry trends and challenges.

• “When considering an affiliation with a larger health system, rural hospitals must place the healthcare needs of their local communities above all other considerations.”

The article discusses the  professional backgrounds  and other experiences, and  the personalities, needed in putting together an effective hospital board of trustees in this very disruptive time in healthcare.









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