New revenue sources
When it comes to finding new sources of revenue, few healthcare organizations match the creative ways in which rural hospitals take advantage of any and all opportunities.
Just a few examples of ways that hospitals have created opportunities include: offering emergency, acute, and skilled nursing care; respite care; home health; durable medical equipment; home oxygen; rehabilitation services to non-traditional services like delivering meals to home-bound elderly people; operating a senior meal site in the cafeteria; managing an assisted living complex for seniors; operating a day care center; and contracting with the local prison to provide linen service and meals.
Rural hospitals are flexible. They can expand and diversify the services they offer to meet local needs for long-term care and specialized services. Many have modified all or some of their facility so the hospital becomes a primary-care center or an outpatient facility specializing in surgery or diagnostic and evaluation activities. Some have even converted beds for long-term care.
In addition, rural hospitals have come to find that with great technology comes great opportunity and telemedicine is no exception. Rural hospitals that find it difficult, if not impossible, to recruit specialists are doing the next best thing by bringing them on board remotely. For example, Steve Jacob, writing online for D Healthcare Daily, reports that Hopkins County Memorial Hospital in Sulphur Springs is working with a group of physicians and a medical technology company to leverage real-time specialist consultations to increase quality of care.
Nationally, about half of U.S. rural hospitals use telemedicine to close gaps in specialist care. Some good news is that Texas is one of a handful of states that mandates private insurers reimburse for telemedicine and generally requires healthcare coverage providers treat telemedicine consults as if they had occurred in a face-to-face environment.
One of the hottest funding issues is the Texas Healthcare Transformation and Quality Improvement Program, commonly known as the Medicaid 1115 Waiver.
Valued at nearly $30 billion over five years, the Waiver supports projects that improve access to needed services and reduce healthcare costs.
According to the Texas Hospital Association (THA), the waiver will transform how healthcare is delivered and paid for in Texas. The waiver expands Medicaid managed care to the entire state by replacing the upper payment limit program with two new pools of funding:
- The uncompensated care pool, valued at $17.582 billion between 2011 and 2016, reimburses hospitals for the cost of care for Medicaid and uninsured patients for which the hospital does not receive payment.
- The delivery system reform incentive payment pool provides up to $11.418 billion in earned incentive payments to hospitals and other providers upon their achieving certain goals that are intended to improve the quality and lower the cost of care.
To highlight how difficult it can be to count on government funding, in October of 2014, the Centers for Medicare and Medicaid Services (CMS) began a Financial Management Review of funding arrangements it believes constitute the unallowable use of provider-related donations. As a result, CMS is deferring $75 million in Texas uncompensated-care payments while it investigates.
Within the Medicaid 1115 waiver is another funding opportunity; the Nursing Facility Upper Payment Limit (UPL) Supplemental Payment Program. And, here again, rural hospitals have lead the way in taking advantage of the opportunities created.
In simple terms, hospitals can take over ownership of a nursing facility (some of which may otherwise fail financially), absorb the facility’s overhead and, in return, qualify for additional Medicaid reimbursement for the care the facility provides. For a detailed look at the program visit the Texas Health and Human Services Commission (HHSC) web site.
Because of the large amount of uncompensated care provided, encouraging uninsured residents to purchase private coverage is perhaps one of the most important ways rural hospitals are making sure they stay in business. THA says an estimated 28% of the state’s more than six million uninsured residents are eligible for tax subsidies. Taking this bull by the horns, many rural hospitals have partnered with TORCH (Texas Organization of Rural and Community Hospitals) in the launch of a private exchange that offers personal assistance to help rural Texans purchase health insurance. Called Texas Community Healthcare Plans (TCHP), the exchange provides access to trained and experienced Texas licensed agents who assist with the enrollment process seven days a week, 24 hours a day. TCHP is linked to the Federal Exchange to access all available tax incentives and premium subsidies.
Well pilgrim… where to now?
As we have seen, rural hospitals have been aggressively pursuing operating efficiencies and patient safety and quality improvement. The road ahead for most will include leading or aligning with a primary care network and eventually a service network based on population-based healthcare(with payment standards based on preventive care, reduced hospitalizations, and the avoidance of duplicated services and unneeded procedures).
The trick to crossing the “shaky bridge” is to know when and how to transition from a delivery system aligned with the current fee-for-service payment system to one that can capitalize on a value-based payment system.
Childress cancer clinic: a rural first
An interview with CEO John Henderson*
By Curtis Verstraete
Curtis Verstraete (CV): Why has Childress been able to succeed despite an increasingly complex and challenging economic, regulatory, and political environment?
John Henderson (JH): I think it is because we do our best work in difficult times… and we have a solid foundation. We are independent and I expect we will remain that way. We have a good combination of leadership with a vision and the determination to help everyone involved believe our best days are still ahead. This belief fosters inventiveness and new ways to meet human need. Even though it’s not getting any easier to improve quality, patient satisfaction, and control cost, we have managed to do so without going to the brink of financial failure.
CV: What are the most significant challenges ahead for CMRC and rural hospitals in general?
JH: Childress County is one of the poorest counties in Texas; we do not have oil and gas, just cotton and wheat fields. We are not heavily subsidized because we do not have property taxes. Also, the ACO (Affordable Care Act) cut Medicare payments to hospitals in anticipation of more insured patients. This did not happen: we took the cuts but did not get the coverage.
Small hospitals are most vulnerable. Everyone expects rural hospitals to close and I think there have been eight closures [in Texas] in the past 2 years. As things continue to deteriorate we have to remember it is always darkest before the dawn. Access to care is critical so a solution must be found.
While there are problems with ACO, I remain positive and optimistic. We are caring for everyone who is here, so I love the idea of moving from volume to value as we stand to benefit because our quality is great.
CV: How does cancer care fit into your survival plans?
JH: Everyone has been touched by cancer and this human need is the impetus driving our cancer program. Childress has always dreamt of providing limited chemotherapy service to patients and it finally happened about 18 months ago.
The biggest problem was finding a willing oncologist; it was hard to convince someone to drive for a half of a day to spend the other half of a day in the clinic.
I swung and missed many times… I approached oncologists in Altus, Wichita, and others until I found our partners in Lubbock.
By example, we went through a situation similar to our cancer clinic with a local dialysis center. They were for profit and were losing money so they did not renew their lease. But somehow, we figured out how to keep the service in Childress.
I believe ours is an interesting, valid approach for rural hospitals. Even though it is not a financially viable business proposition, because we are a public, hospital, we are able to do some things despite budget head wind. That said, our board has to stay in the neighborhood of breaking even.
CV: When it comes to surviving, what do you focus on?
JH: Our front office squeezes every dollar. Going forward, reimbursement issues will be huge and we have less control there, but we can hold the line with spending.
On the operational side, we will deliver great care and I hope the transition from volume to value will be quick.
Transparency is also vital; for the last 5 – 10 years we have intentionally measured and publicly reported more – rather than less (quality and satisfaction scoring). We are as transparent as possible and when we have had problems with data, we address the problem… we are not hiding the data.
Surgical site infections are a good example. When you have a sample size of five patients and one suffers congestive heart failure, it looks very bad. Large hospitals aim for 97% and because they treat hundreds of patients, the numbers are acceptable. But that doesn’t work for us so we stopped making excuses and we are doing everything possible to make sure we are always five for five.
CV: Looking ahead, what do you think the future has in store for your hospital?
JH: I believe our best days are ahead. For Childress, I do not see a lot of new service expansion. For the next 5 – 10 years we will hold on to what we have and focus on improving quality.
I think physician recruitment is going to be a big issue as well as nurse staffing. Work force issues have always been a challenge for small community hospitals.
But I do think the financial picture will start to improve in the next four to five years. If the national economy grows, it will contribute to our ability to survive… if it doesn’t, well we will see more closings. I hate to say it but it may take more closing to get the attention and action we need.
Overall, I believe clinical quality and a focus on patients is what makes hospitals like ours stronger. I know we will find a way. People underestimate the resilience and commitment that rural hospitals and communities have. We are going to be OK.
* Many Texas healthcare leaders see John Henderson as the spokesperson for rural healthcare. A testament to his leadership and the respect the community has for him is his selection as chairman of the Texas Hospital Association in 2016. John is the youngest person ever and the first rural CEO in 30 years to hold this position.
Is healthcare’s future rural?
By Tim Size | The Daily Yonder
A lot of people write about the future of rural healthcare. Typically there is no shortage of anxiety on the topic. But there is more to the story. We need to understand that rural can be healthcare’s future.
I know better than most the list of challenges for rural communities. I don’t deny them, but it pays also to look at what we do well and how rural healthcare can help lead American healthcare.
Rural healthcare is part of the change sweeping across the country. The mandate has rightly become to drive quality of care up and costs down while improving the health of the whole community. Rural is and will be part of that “Triple Aim” movement.
The best of rural health has long focused on places and patients. “Place-based” care means that health organizations consider the values, tradition and economic well being of the community when they make decisions. “Patient-centered” care means that we organize the health-care experience around the needs of the patient as opposed to just the convenience of the provider.
One great example of place-based, patient-centered care is the work of Ministry Door County Medical Center based in Sturgeon Bay, Wisconsin. They subsidize a clinic in partnership with the 718 year-round residents of Washington Island in Lake Michigan. That wouldn’t happen if the medical center didn’t value places and patients.
These values are deeply embedded in rural health and will be a key driver of success for healthcare in both rural and urban communities. We do not need to turn rural into a small version or outpost of urban. We do need to build on our natural strengths as we continue to evolve our services to meet the Triple Aim.
Rural health has a strong base upon which to build. In collaboration with the National Rural Health Association, iVantage Health Analytics has shown that the cost per rural Medicare beneficiary is 3.7% lower than the average cost per urban beneficiary and that neither rural nor urban dominate on quality measures.
Robert Wood Johnson Foundation and the University of Wisconsin Population Health Institute have developed a national report of county health rankings that is updated annually. In general, rural counties are expected to not do as well as urban counties due to lower levels of employment, income and education, among other factors that drive health status.
This year, given these factors, you would expect only 13 of Wisconsin’s rural counties to be in the top half of counties with the best health. In fact 20 are in the top half of the counties with the best health. Quite a few rural communities are doing something right to out-perform expectations.
The reality and potential of neighbors caring for neighbors has long been a strength of many rural communities. They more readily bring together diverse leaders from throughout the community and region to address multiple determinants of health, such as access to local healthcare, education and jobs.
Rural hospitals in Wisconsin are respected around the country for the quality of the care we provide. The Medicare program (our major payer) should think of us as a demonstration site for how payment policies can evolve to best fit the needs of rural beneficiaries and communities. We remain hopeful that they will come out of Washington D.C. to Wisconsin to learn more about how rural communities and Medicare can become more closely aligned.
The National Rural Health Association has identified four priorities for moving toward the future of rural health:
Underlying these priorities is a critical foundation: Don’t throw the good out with the bad. We must protect local access to rural health-care providers and physicians. We have already seen “health” insurers refusing to contract to provide local rural healthcare. We must support and defend the right of residents to seek care locally. Access standards must continue to “reflect the usual medical travel times within the community.”
John McKnight, a long time community organizer and founder of the Asset-Based Community Development Institute at Northwestern University had it right.
“The place to look for care is in the dense relationships of neighbors and community groups,” McKnight said. “We have a competent community if we care about each other, and about the neighborhood. Together, our care manifests a vision, culture and commitment that can uniquely assure our sense of well-being and happiness.”
Tim Size is executive director of the Rural Wisconsin Health Cooperative in Sauk City.
Here we grow again!
Newest “A” player joins the HealthSure team
The HealthSure team welcomes our newest member, Krista Adamson, CIC, CISR to the position of account manager.
Krista has more than 11 years of experience in commercial lines insurance and customer service. Prior to joining HealthSure, she spent 2 years at The John A. Barclay agency predominantly servicing real estate developers and non-profits. Prior to that, she spent 6 years at INSURICA Insurance Management Network specializing in construction and large property accounts. Krista has attained professional designations as a Certified Insurance Service Representative (CISR) and a Certified Insurance Counselor (CIC).
“HealthSure is always looking to increase it’s bench strength, we’re always recruiting and Krista comes to us with a strong track record in being an account manager in the agency world,” says HealthSure president Brant Couch. “She knows our systems, is familiar with the complexities of our client base, and will be instrumental to the achievement of our growth plan and our ability to help our clients succeed in these increasingly complex times.”
In addition to her professional work, Krista volunteers for the Sustainable Food Center, planning farmers market events and working at the “taste the place” tent at the Sunset Valley and downtown farmers markets.
HealthSure’s mission is to help healthcare organizations succeed in the increasingly complex world of risk and insurance.
Our unmatched focus on healthcare means we know the industry better than anyone else.
It is our job to make sure:
We believe simplicity is the cure for crushing complexity.
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