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New rural hospital designation still needs tweaks and more flexibility, stakeholders say

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To staunch the losses of rural hospital closures that endanger entry to look after tens of millions, federal regulators are hoping some services choose in to a brand new cost mannequin, however suppliers say they need extra flexibilities and readability earlier than making the pivot. 

Rural stakeholders say they’re excited in regards to the new mannequin that gives wanted flexibilities for rural operators to remain open, however say extra tweaks are wanted to deal with the realities of offering care in rural America. 

The brand new rule “possibly will get midway there,” Jennifer Findley, vice chairman of training and particular initiatives on the Kansas Hospital Affiliation, instructed Healthcare Dive. “It’s not as a lot as we had been hoping for but it surely does give some extra flexibility than what you might have at the moment.”

The necessity for a brand new mannequin

There have been rising considerations about rural hospital closures over the previous decade. 

About 138 rural hospitals closed between 2010 and October 2021, lots of that are situated within the South, in line with a short from the Nationwide Advisory Committee on Rural Well being and Human Companies.   

These closures minimize off entry to care for a lot of rural Individuals, who are typically older, sicker and poorer than their city counterparts. General, about 20% of Individuals stay in a rural space, in line with analysis funded by the Federal Workplace of Rural Well being Coverage. 

In lots of rural communities, there merely isn’t sufficient quantity to financially assist a standard hospital with inpatient companies, which has fueled cries for extra flexibility. 

The intent behind the brand new designation is to chill out among the regulatory burdens confronted by rural hospitals, just like the requirement that hospitals should present inpatient companies with a purpose to obtain Medicare funds, a crucial funding stream many suppliers couldn’t forgo.

That’s a ache level for a lot of rural hospitals which have very low affected person volumes. 

“We now have 40-some hospitals who on any given day have like two sufferers,” Findley stated. Kansas is predicted to have essentially the most services convert to the brand new designation, in line with a previous report from the North Carolina Rural Well being Analysis Program.

Communities want different choices than full-service hospitals to make sure continued entry to companies, the MedPAC, the group that advises Congress on Medicare coverage, has stated.

MedPAC urged Congress in 2018 to permit rural services to function as stand-alone emergency departments, omitting inpatient companies altogether, after discovering that about 130 rural hospitals averaged lower than one admission per day throughout all payers in 2016.

Beneath the brand new designation, hospitals must finish inpatient companies, however should keep emergency companies 24 hours per day, seven days every week.

Whereas that may be a welcome change, Kansas stakeholders are involved that different parts of the proposed rule are nonetheless too prescriptive or unclear. 

The necessity for flexibility

Rural operators need to have the ability to use present house and employees to supply the companies their communities want, stakeholders instructed Healthcare Dive.  

Findley says rural operators need to keep away from inflexible guidelines round using house and employees with a purpose to be nimble and environment friendly with assets.

One space of frustration within the rule is how skilled-nursing beds can be utilized. Beneath the proposed mannequin, hospitals must arrange a separate operation that may’t be folded into the agricultural hospital or included within the new cost mannequin.

It once more raises questions in regards to the continued viability of the sort of service attributable to low affected person volumes. 

There are questions round whether or not the services can proceed within the 340B program and if rural well being clinics can proceed to make use of present cost methodologies. 

Transportation is one other space of concern as a result of many rural areas depend on voluntary emergency medical companies. Findley and her group had hoped further funding could be obtainable for transportation, but it surely wasn’t included within the proposed rule.

Altering the cost mannequin pivot

Rural operators are actually modeling whether or not they can afford to change to the brand new mannequin.

Beneath the proposed rule, hospitals might be paid beneath the outpatient cost system and can get to tack on an extra 5% for the care they supply. Plus, they’ll obtain a month-to-month facility cost, which is increased than anticipated, Carrie Cochran-McClain, chief coverage officer of the Nationwide Rural Well being Affiliation, instructed Healthcare Dive.

That may seemingly make it extra financially possible for some, Cochran-McClain stated. Nonetheless, it isn’t supposed for each supplier.    

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