RURAL HEALTH policymakers maintain that access to care for people living in rural areas has only gotten worse since the time of this description from 1950: “Many families on farms and in small towns find that they live at the far end of the road when they look for health services. The more rural a county's population, the fewer doctors, dentists, and hospitals it is likely to have” (Johnston, 1950).
That the future of rural health care is in jeopardy, epitomized by the plight of rural hospitals, is not a new or even recent phenomenon. Rural areas have had a longstanding association with declining populations, economic stagnation, shortages of physicians and other health care professionals, high rates of chronic illness, a disproportionate number of elderly, poor, and underinsured residents each of which have been listed as major threats and concerns for rural health for over 40 years (Weisgrau, 1995). Practice patterns that have seen ever more patients directed to the outpatient setting continue to reduce the financial viability of rural hospitals. The Government Accountability Office recently found that, “64 rural hospitals closed from 2013 through 2017. This represents approximately 3 percent of all the rural hospitals in 2013 and more than twice the number of closures of the prior 5-year period” (Government Accountability Office, 2018).
Hospital closures result from multiple factors, but one commonality is the over dependency of hospital financing upon payments for inpatient hospitalizations in subsidizing total hospital costs and the sharp decline in those volumes. Medicare payment policy has been observed as being a major driver of this dependency, which has led to recommendations for reform by the Medicare Payment Advisory Commission (MedPAC) in which the future role of rural hospitals is directed toward serving rural communities as technologically robust urgent care centers and relaxing the obligations to provide inpatient services to receive full hospital payment from Medicare (MedPAC, 2018).
The prevalence of poverty and high concentrations of chronic disease in rural populations ensures that the Medicaid program has a central role in sustaining a network of rural health resources. It is therefore unsurprising to observe that a major beneficial result of the Medicaid expansion stemming from the Affordable Care Act (ACA) is helping rural hospitals to keep their doors open (Government Accountability Office, 2018; Lindrooth et al., 2018). Currently, 37 states (including District of Columbia) have expanded, or are committed to expand, Medicaid under the ACA and 14 have not expanded Medicaid (Kaiser Commission on Medicaid and the Uninsured, 2018). Thus, the majority of states have expanded Medicaid to provide a bulwark against rapid rural hospital closure. But despite the temporary relief offered by an influx of Medicaid money that helps to cover bad debt, few doubt that rural health care requires a move away from hospital-centered delivery to more flexible and lower cost service offerings that serve the needs of the local population rather than the psychological reassurance of the bricks and mortar of a hospital.
Redesigning the rural health delivery system requires an anchor mixing primary care and emergency services at a level suitably scaled to be affordable to communities. It should be stressed that affordability needs to be both for communities as a whole and for individuals accessing health services. In this model primary care would be integrated within a network of supporting services (eg, behavioral health, dental care, medical care, palliative care, and home health), that can be delivered when required (Mueller et al., 2017). A focus on population health and innovation should be supportive of these efforts and needs to break with the traditional focus upon individual providers and services. In short, hospital-centric financing needs to be reoriented so as to specifically fit the needs of rural communities rather than crafting a hospital payment policy within which rural hospitals are identified as a small, “inefficiently sized” subset within the whole.
Payment redesign first requires determining the preferable structure for care delivery to rural communities. This in turn requires consideration of the specific circumstances of rural communities. There are several complementary, rapidly evolving technologies and practice patterns that have particular bearing on rural care delivery that should be incorporated within an overhaul of rural health service financing.
Telehealth is rapidly changing in both scope and potential. Interactive visits from distant sites, such as a recognized clinic setting, can be delivered remotely and are routinely covered for payment if performed by qualified practitioners (Centers for Medicare & Medicaid Services, 2018b). Specialty consultations delivered via Telehealth are more easily obtained and better integrated within routine clinical practice. For example, every state now has at least one established Telestroke network (Wicklund, 2018) intended to more rapidly treat and accurately diagnose patients with stroke. As Telehealth evolves further, rural communities will become less dependent upon the presence of skilled locally based health care providers.
A large-scale example of the potential for this shift is the experience of Intermountain Healthcare that has “installed a common technology platform in more than 1,200 patient rooms, intensive care units, emergency departments (ED), neonatal care units, and outpatient clinics in rural Utah. Since the launch of the Critical Care TeleHealth program: Mortality rates have decreased by 33% in community hospitals; Length of hospital stay has decreased by 7%; Higher acuity patients are now able to stay in their communities more often; Over 12,000 digital visits have been completed through Connect Care” (Rural Health Information Hub, 2018).
Expansion of nonphysician care delivery
Alaska has pioneered using community health workers who work together with local rural health professionals to cover many aspects of health care delivery (Golnick et al., 2012; Hillman, 2018). Obstetric services are a particular challenge for rural communities with the closure of rural hospital obstetric services linked to worse outcomes such as increases in preterm births (Kozhimannil et al., 2018). Hospital-based care is not necessarily required to maintain these services safely and effectively particularly for low-risk pregnancies. Research has indicated that midwifery-led practices can replace obstetrician-led services in rural communities for low-risk pregnancy (Durst et al., 2016; Graves, 2012). Moreover, the need to add primary care capacity in rural communities has led to reevaluating the existing role of nurse practitioners in rural care delivery (Kaiser Commission on Medicaid and the Uninsured, 2015).
Organizing physician resources collaboratively
While expanding nonphysician-directed care is one response, another is to reorganize the way that physicians collaborate within a community to better serve the community needs. An example of this is the way in which many medical communities have responded to the declining number of care providers by creating collaborative practice models in which there is shared on-call responsibility (Colorado Health Institute, 2010). Both physicians and patients report a high level of satisfaction with these models, and outcomes are good. Communities that are unable to sustain surgical or obstetrical specialist care but that are large enough to justify local surgical services can effectively be supported by general practitioner-surgeons who provide only cesarean sections or broader surgical services (Abbot et al., 2014).
Coordinating access to complex services (rather than direct delivery of care)
Many complex services require significant patient volumes not just to enable the service to be delivered cost-effectively but to ensure care quality and improve patient safety. Rather than focus upon having access to services “10 minutes from home,” existing infrastructure can be reoriented into delivering urgent care “hubs” that connect seamlessly with regional centers of excellence (Pearl, 2018). In this way the accepting center increases patient volumes, enabling greater specialization and thereby improved outcomes, while the referring facility has the residual problem of developing greater interoperability with the accepting hospital in terms of (i) common communication (eg, medical record transfer), (ii) initiation of medical care that will be taken over by the accepting site (eg, common care protocols), and (iii) physical transfer (eg, medevac capability). To maintain access to care in communities where inpatient volume is declining, there is an interest in payment models focused on outpatient access rather than on maintaining inpatient services.
In summary, a payment structure for rural health care would need to account for developing delivery systems that:
- Would better integrate community care within the whole without necessarily providing it
- Lessen provider isolation while permitting higher payment levels to promote retention
- Enable monies to be diverted to supporting programs that can improve population health outcomes rather than paying for the individual services provided
- Are supportive and encouraging of the potential for telehealth to achieve these goals
A number of states have current initiatives designed to support some of these features in rural health redesign. For example, Vermont Blueprint for Health (Blueprint) is a state-led, public–private initiative that aims to improve the health of individuals and communities. Primary care practices and community health teams (CHTs) participating in Blueprint serve enrollees not only from Medicaid or Medicare but from all payers in the state. Locally designed multidisciplinary CHTs provide care coordination services and support to Blueprint primary care practices and enrollees. Such services extend beyond the medically complex patient population. CHTs connect Blueprint enrollees to a variety of community-based resources (eg, helping determine transportation options and assisting with applications for affordable housing and insurance enrollment). They connect people to nonclinical specialists such as dieticians and health coaches who help with weight loss or making dietary and lifestyle changes, and with behavioral health specialists who provide assessment and intervention services (State of Vermont, 2018).
MedPAC's proposed redesign of Medicare financing for rural hospitals is intended to provide support for isolated rural hospitals by proactively encouraging them to become urgent care centers (MedPAC, 2018). This is achieved by (i) allowing a standalone ED to be paid for providing emergency care (without requiring accompanying inpatient services); (ii) an annual distribution of financial support to help cover overhead costs, and (iii) reforming Medicare payment rules that eliminate facility payments for outpatient facilities located more than 35 miles from a parent hospital. The MedPAC proposal recognizes the need to reorient the role of rural hospitals by providing changes to the ways in which they are paid and providing fixed block funding rather monies tied to patient volumes. However, it does not address the organization of health care in rural communities (eg, how specialty services may be delivered), the need to provide more primary care and support of primary care practices nor the rebalancing of health outcomes in rural areas.
Pennsylvania has launched the Pennsylvania Rural Health Model with the intent of preserving rural hospitals while reorienting their function to manage population health (Centers for Medicare & Medicaid Services, 2018a). The model is a joint Medicaid/Medicare partnership whereby approved rural hospitals receive a capitated amount on a monthly basis equal to their historic total payments for inpatient and outpatient services. The model is intended to attract other commercial insurance plans into the payment model thereby stabilizing funding while service delivery is reoriented to focus upon population health targets. A model with similarities (upon which the Pennsylvania model is based) has been underway in Maryland since 2014, with increasing focused upon population health outcomes alongside cost containment. The model replaced the existing waiver that enabled all-payer hospital rate setting through the Hospital Services Cost Review Commission with the “Maryland All-Payer Medicare Model Contract,” which expires in December 2018, and shall begin the “Total Cost of Care” model as its latest phase in 2019 with the intention of running through until 2029 (Health Services Cost Review Commission, 2018). Unlike the Pennsylvania model, the Maryland model is applicable to all hospitals (not just rural) and compels all payers, Medicare, Medicaid, and commercial, to engage with the model.
What is common to these initiatives is the reorientation of the rural hospital mission to provide fewer core services, seeking greater focus upon population health goals and reforming existing payment policy to help rural hospitals achieve those goals and keep their doors open.
What is also common to the initiatives is that they seek to have rural hospitals define what is required to care for rural populations, effectively allowing the hospitals to design a system of care around them rather than building a strategic plan of what the rural health delivery system should look like and thereby determine the role (and funding) of rural hospitals.
RURAL CONVENING ENTITIES—AN ALTERNATIVE APPROACH
In 1931, the preeminent public health professional, CEA Winslow published a book entitled Health on the Farm and the Village (Winslow, 1931). It is an evaluation of one rural county's efforts to “demonstrate by cooperation with three typical communities embracing a population of half a million people, whether by intensive application of known health measures the extent of sickness in the United States can be further and materially diminished and mortality rates further and substantially reduced, and whether or not such practical results can be achieved in a relatively short period of time and at a per capita cost which communities will willingly bear.” Amusingly it reported that, “the only shadow on the general success of the demonstration has been an attack upon it by the local County Medical Society in 1927 and 1928.”
We believe that the efforts of early and mid-20th century should be revived. Instead of redesigning payment with the central intention of keeping rural hospitals in place and financially viable, we could instead start with what a community requires from its health care system. This article from 1950 describes an approach that we should consider for today:
Groups of persons in some rural communities have been looking into local shortages of doctors and hospital beds. Some have made a diagnosis of their community health needs based on a rather careful investigation. Others have based their diagnosis on a more superficial examination. Just as they have diagnosed their need, so in some areas men and women from farms and small towns are planning and carrying out their own prescriptions to meet that need. Among other measures, they are prescribing cooperative associations to obtain for themselves and their communities health services they cannot get by working individually. (Johnston, 1950)
While some communities may seek to have a rural hospital repurposed as an ED and outpatient center, others might view this as an opportunity to distribute hospital resources to diversified locations once free of the requirement to provide inpatient services. It is also possible that the desire to focus upon primary care delivery coupled with attracting and retaining physicians may be better served by including community physicians in the design, management, and budgeting of services rather than driving change through rural hospitals and thereby rural hospital management structures. It might therefore be preferable to create a structure to match the intent of repurposed service delivery that we shall call a rural convening entity (RCE).
An RCE would fulfill a role similar to a hospital board with a mandate to define objectives and community goals. While a rural hospital and its administrators may form a central plank of an RCE management team so would community physicians, supportive service providers, payers, and community representatives. This is very similar to some of the rural health cooperatives from the early and mid-20th century: “Cooperatives are self-help organizations, formed voluntarily on a nonprofit basis by groups of people wishing to meet a common need. Ownership and control rest equally with all members. The members set the goals and determine general policies. They elect a board of directors which, in turn, employs a manager who carries out the association's policies and conducts its affairs under the board's general supervision. Each member is entitled to one vote in electing directors and deciding other questions coming before the membership” (Johnston, 1950).
In this model, rural hospitals are one resource in the community with a specific task, to orchestrate the link to acute care, both routine and specialized, for the local population. This does not mean that the hospital has to provide services directly but rather to ensure that acute care can be sourced rapidly when required. This can take the form of close integration with larger medical centers, coordinating health record transfers across regional providers and being designated access points for telehealth.
The evolution of telehealth is particularly important for rural communities. It is becoming increasingly possible for centers of excellence to provide real-time support for patients and clinicians remotely via audio and video conferencing for specialty consults and emergency medicine (Rural Health Information Hub, 2018). While these services are slowly receiving recognition and payment, they are typically delivered under a fee-for-service basis or as part of a wider single health system strategy to partner with and manage the health of rural locations. This could instead be incorporated as a management contract tailored to the local community health requirements.
As with the Maryland and Pennsylvania models, it would be expected that financing of the redesigned care delivery system would be an all-payer effort. In short, rural locations cannot afford service redundancy and waste borne of payers providing their own pathway, service requests, and payment models independently. In particular, establishing, maintaining, and administering a network infrastructure supportive of the adoption and evolution of Telehealth services, overseeing health service quality and legal compliance, interoperability across providers, integration with physical health resources, and coordinating reimbursement across payers is a significant barrier for individual providers in rural service areas. In return for investing in the RCE model, payers and health systems would have inclusion on the boards governing the investment strategy to provide comprehensive services. Such service delivery could also include developing strategies to better engage patients and their support systems (eg, family) in the management of their own care, which is seen as a logical extension of the confluence of telehealth and the increased reliance upon primary care (Terwiesch et al., 2017). If service delivery is “right sized” then economies can be made on the required scale of primary health requirements, treatment programs, and supporting services.
The RCE can serve 2 complementary functions. The first is as a regional enabler and administrator of telehealth services. A convening entity such as an RCE can be established to ensure a structured approach to patient access to telehealth. Telehealth can range from synchronous encounters with primary care physicians and specialists to the remote monitoring of chronic illness and physician-to-physician consults or remote surgical guidance. Keeping the network infrastructure running and paid for is a major task. To do so requires significant planning to avoid network redundancy, ensuring patient service access at remote locations and a means to generate revenue. The RCE can assume this role much in the same way that a public utility can connect suppliers and consumers and with much the same financial model. After an initial investment, potentially generated as part of a rural health redesign project, providers may be billed a fixed fee per encounter. In this way providers pay for the telehealth network in proportion to their use and payments, thus avoiding the risk of high startup and maintenance costs for an unknown change in practice patterns.
A more expansive model would see physicians engaged with the RCE as being directly salaried rather than dependent upon fluctuating rural patient volumes with any incentives to retain and attract physicians factored in. Similarly, as with each of the rural health initiatives outlined earlier, rural hospitals could receive a fixed disbursement tied to their specified mission rather than relying on maintaining patient volumes. But, while payment may be made at a fixed rate, it is important both for community and payers that the efficacy of the RCE be judged on the health outcomes it generates. These outcomes may be judged on population health targets such as mortality rates or frequency of readmission following acute hospitalization or patient-focused surveys such as those for patient confidence or satisfaction. Budgets however would be fixed such that cost savings can be recycled into community health projects and enhanced services. A brief overview for a potential timeline to generate these payment structures is given in the Supplemental Digital Content Appendix “Payment Reorientation” available at: http://links.lww.com/JACM/A85.
And by focusing upon health outcomes while delivering a fixed budget, monies can be diverted to provide services that while not considered clinical have a large impact on health outcomes and associated costs. There is for example a great deal of literature that identifies insecurity of food, housing, and transportation barriers as being associated with worse health outcomes. Being able to redirect funding to attend to those problems not only improves public health but reduces public cost (Nichols & Taylor, 2018).
This article highlights the challenges and, in fact, opportunities inherent in delivering health services to rural parts of the United States. Significant advances in medicine together with dramatic changes in the health professions, both in the last quarter century, offer significant opportunities for improvement, not just stabilization, of rural health care. Financing mechanisms are a key component of this effort. This article specifies the outline of a prepaid option that builds on the progressive historical tradition of rural health care in the early 20th century.
The RCE we propose is most likely to succeed if we take into account the recommendations for effective group cooperative associations that experts made in the early 20th century:
- Choose the organization committee or board carefully. Be sure they represent different organizations and different sections within the area.
- Build membership soundly. Make certain that the association has adequate community support for its plans.
- Keep people informed both during the organization period and afterward. The key to good membership relations is “to keep members in touch so they think of the association as their business.”
- Develop sound plans for financing; plan to have funds on hand when a health service center first opens.
- Emphasize service in prepayment plans; “promise only what can be delivered”; make preventive medicine part of the plan; keep accurate records of income from members and services they use.
- Choose doctors carefully; make certain they are not just interested in a job but are interested in making and keeping people well; make businesslike arrangements with doctors.
- Arrange for exchange of ideas among cooperatives and also, possibly, for group purchasing and use of special services.
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