Wednesday, November 22, 2017

13 hospitals join CMS' rural pay experiment

The CMS on Monday added more hospitals to a program that industry executives say has been key to ensuring access to care in underserved communities.

All in all, 13 additional hospitals will participate in the Rural Community Hospital Demonstration Program, which reimburses hospitals for the actual cost of care for inpatient services provided to Medicare beneficiaries rather than standard Medicare rates. Medicare typically pays as little as 80% of inpatient services costs.

The program started in 2014 and was extended last year under the 21st Century Cures Act for an additional five years.

The new participating hospitals include Montrose Memorial Hospital in Colorado, Trinity Regional Medical Center in Iowa and St. John's Medical Center in Wyoming. They join 17 hospitals that were already in the program.

Eligible hospitals have to be located in a rural area, have fewer than 51 acute-care beds, provide 24-hour emergency services, and not be designated as a critical-access hospital.

The program expansion comes as Medicare margins—the difference between revenue and expense—are in free fall. In 2015, the aggregate margin hit negative 7.1% across hospitals according to the Medicare Payment Advisory Commission, and it was expected to hit negative 10% this year.

For Corey Lively, CEO of Great Plains Regional Medical Center in Oklahoma, the demonstration is a godsend. His hospital is one of the 13 joining the experiment.

Before hearing that the CMS was looking for additional hospitals to join the demonstration earlier this year, he was considering scaling back service lines, including cancer treatments, as commercial reimbursement rates continue to drop and Medicare and Medicaid continued to underpay for services.

The demonstration "allows us to maintain a higher level of services that if we didn't provide, some would have to travel 110 to 130 miles to receive," Lively said.

The additional funds drawn through the demonstration have helped Columbus Community Hospital in Nebraska, which has been in the program since the start, keep up with rising costs of technology and medical equipment, according to its CEO, Mike Hansen.

It has also given the hospital the funds necessary to attract staff. Over the past few years, 120 clinicians, physician assistants, nurses and others have been hired.

"It's difficult to recruit to small rural towns, but the demonstration has certainly been key in helping to allow us do that," Hansen said.

Jason Cleckler, CEO of Delta County Memorial Hospital in Colorado, agreed the demonstration funds are key to recruitment efforts and noted that it also helps keep the salaries of current staffers competitive.

"This program is really important for rural hospitals that are facing difficult challenges when it comes to reimbursement and payer mix," Cleckler said.


Rural Community Hospital Demonstration Fact Sheet

Friday, November 10, 2017

Medicaid Is Great, but Rural Maine Needs Hospitals, Too

LEWISTON, Me. — This week Maine voted to become the 32nd state to expand Medicaid despite opposition by Gov. Paul LePage, who had vetoed five previous expansion bills passed by the state legislature and has now threatened to block the results of the ballot initiative. Unless Mr. LePage succeeds, about 80,000 more Mainers will be eligible for coverage, a victory in an unsettling year for health care in America.

With the Affordable Care Act under constant threat from the Trump administration and out-of-pocket costs rising faster than wages, health care topped the list of the most important issues facing Americans this year.

However, Maine and other rural states face a health care crisis that Medicaid expansion can’t fix on its own. It’s not about affordable coverage; it’s about access: For too many rural areas, doctors and hospitals are scarce.

In the postwar era, America made hospital construction and modernization a priority. On Aug. 13, 1946, Harry Truman signed the Hill-Burton Act, giving communities grants and loans for hospital construction. By 1975, almost one-third of American hospitals owed their creation to the law. Financing for Hill-Burton health care construction ended in 1997, but one rule from the original bill still applied: These hospitals had to give free or reduced care to people who couldn’t afford services. As rural areas aged and the population shrank because of manufacturing’s decline and the rise of a technology-driven economy centered on urban areas, hospitals struggled to stay in operation.

Under the Affordable Care Act, hospitals started shutting down at worrisome rates because of an increase in financial penalties for noncompliance with A.C.A. mandates, the cost of tighter reporting standards and smaller reimbursements for certain procedures. Since the A.C.A. became law in 2010, over 80 rural hospitals have closed nationwide. Maine alone has lost three hospitals in that time, about 10 percent of its rural total.

If closings continue at this rate, 25 percent of America’s rural hospitals will have disappeared in the decade after Obamacare’s passage. This does not take into account facility deterioration, doctor departures or department closures.

This is a big problem for Maine, which has the highest percentage of rural residents in the country, according to the most recent census data. Calais Regional Hospital in Down East Maine recently oversaw its last childbirth. The obstetrics department closed in late summer, forcing women in labor to drive 50 minutes to deliver their babies. Despite an opioid crisis that increases the chance of high-risk pregnancies, this same privately owned hospital shut down its pediatrics wing and intensive care unit in recent years, because of financial pressure from the management company halfway across the country in Tennessee.

This was hardly an isolated example in Maine. The town of Jackman closed its 24-hour emergency room in September, and Boothbay lost its only hospital in 2013. Rangeley, where my wife’s family lives, is an hour away from the nearest hospital and has no doctor in town.

Meanwhile, Maine Med in Portland, Maine’s largest city, is about to break ground for a $512 million addition just a few years after it finished a $40 million renovation. While rural Maine’s hospitals and departments are closing because of large losses, Maine Med had, for 2016, a $61 million surplus.
Medicaid expansion is a welcome source of new revenue to rural hospitals in Maine because more insured patients mean fewer uncompensated treatments. Still, it comes nowhere close to fixing the problem or, politically, putting any meaningful points on the Democratic scoreboard.

In 2016, Donald Trump won Maine’s rural congressional district by a 10-point margin and rural counties in America at large by a 26-point margin on a message of repealing and replacing Obamacare. As Maggie Elehwany of the National Rural Health Association said in an NPR interview this year, rural Americans voted for Mr. Trump in part because of health care. “They see their hospitals closing,” she noted. “And one hospital C.E.O. described it as a three-pronged stool. It’s the churches, the hospitals and the schools. If you lose one of those legs of that stool, the whole community collapses.”

Since President Trump hasn’t been able to deliver on any meaningful legislation to support rural voters, it is the Democrats’ time to deliver. One good step is a bill sponsored by the Democratic senators Tim Kaine of Virginia and Michael Bennet of Colorado called Medicare-X. It would give a public option to Americans in rural counties where limited competition has yielded higher-priced health insurance options.

It still doesn’t solve the heart of the rural problem. Democrats can’t just lower premiums and expand Medicaid. We must strengthen rural communities by making access to high-quality health care services a priority of any proposal. In any future legislation, we should demand grants for new hospitals, funds to modernize crumbling ones and financial incentives for top doctors to work in these areas. This will not only make rural communities healthier, but also more welcoming for growth and new business.

No person suffering from a heart attack should die because a hospital is too far. No pregnant mother should have to risk the health of her baby because she can’t make it to a delivery room in time. As Democrats, we believe that health care is a right. It would be a big mistake to expand health care insurance but offer no place to use it.


Tuesday, November 7, 2017

Maine Passes a Ballot Initiative to Expand Obamacare

In another blow to Trump, voters in the state approved Medicaid expansion.

In a night full of repudiations of Donald Trump, here’s one more. Maine voted on Tuesday to embrace a key element of Obamacare, approving a ballot initiative to accept the Affordable Care Act’s expansion of Medicaid to everyone who makes up to 138 percent of the federal poverty line. (In 2017, that’s $16,642 for an individual or $33,948 for a family of four.) It’s expected that around 80,000 people in Maine will gain Medicaid coverage when expansion is implemented.

As I wrote earlier Tuesday, expanding Medicaid in Maine will offer a variety of benefits for the state:
For a rural state like Maine, expanding Medicaid could shore up finances for a number of hospitals that are in danger of closing—more than half the state’s hospitals are currently losing money. Part of the problem is that the ACA cut funding for health providers who provide uncompensated care to uninsured patients—patients who were now supposed to be covered under Medicaid. But when Maine and other states refused to expand Medicaid, health care providers were left without any way to recover those funds.
Studies have shown that Medicaid expansion has both benefited the people who gain coverage and also reduced costs for everyone who buys insurance. A 2016 government study looked at how Medicaid expansion lowered the cost of premiums for people who buy insurance on Obamacare’s individual exchanges, finding (when controlling for various factors) that premiums were 7 percent lower in places with Medicaid expansion. 
Expansion won’t immediately go into effect. As Emma Sandoe, a former Department of Health and Human Services spokesperson, explained earlier this week, there are various ways that Republican Gov. Paul LePage, a vocal opponent of Medicaid expansion, could slow-roll the initiative.

This is the first time voters have directly weighed in on Medicaid expansion. There are currently 19 states (if you include Maine) that haven’t implemented the program. As Republican governors continue to block this part of Obamacare, it’s likely that health care advocates in other states will try the ballot initiative route.


Tuesday, October 3, 2017

Rural Hospitals Are Dying and Pregnant Women Are Paying the Price

Heavily reliant on Medicaid dollars, small hospitals shut down maternity wards just to stay afloat.

BOONE, N.C.—Three years ago, Lucia Parker gave birth to her first child surrounded by people she loved. Her mother, sister, and husband were by her side at Blue Ridge Regional Hospital, and the nurses attending her were family friends. Each of them took turns massaging her back. They lifted her out of a birthing tub and gave her an epidural when the labor pains grew too intense. By the time her son was born, there was not a dry eye in the room. “It felt like family,” Parker says.

The hospital, in Spruce Pine, North Carolina, was 25 minutes from Parker’s home. But this February, when her second baby is due, she won’t be able to deliver there. Instead, she plans to drive an hour-and-a-half southwest to Mission Hospital in Asheville, on mountain roads that could be slick with ice and snow, to give birth in a room with nurses and staffers who are strangers. “I have no idea how that’s actually going to work,” she says. “I am not gonna know anybody when I have this baby.” She doesn’t have much of a choice. Blue Ridge’s labor and delivery unit, which delivered 173 children last year, shut down on September 30. The next closest hospital with a maternity ward, McDowell Hospital in Marion, is roughly an hour southeast of Parker’s home, but she’s afraid to drive there in labor. To reach it, she would have descend 1,400 feet in elevation, navigating a road with curves so tight motorcycle riders call it “The Devil’s Whip.”

Parker is not alone. As Congress debates repealing and replacing the Affordable Care Act, rural hospitals are in a kind of purgatory, unsure about their Medicaid budgets and the private health insurance that sustains them. At least 81 rural hospitals have shut down across the country since 2010, according the North Carolina Rural Health Research and Policy Analysis Center at UNC. The pace of closures has been increasing since the Great Recession, but the current health care policy limbo—which leaves hospitals and insurers unable to predict their income—exacerbates the problem. “The uncertainty is really impinging providers, particularly hospitals, from making the kinds of decisions that might put them on a better footing,” says center director Mark Holmes.

Parker lives in an impoverished swath of rural Appalachia where the hospitals are particularly vulnerable. In her Congressional district, 20 percent of families with children live below the poverty line and more than 40 percent of residents—roughly 318,000 people—rely on some form of publicly-funded health care. Another hospital in the district, Angel Medical Center in Franklin, North Carolina, shut down its maternity ward in July, after officials said the unit was losing $2 million a year. And Parker’s congressman, Republican Mark Meadows, has not intervened to keep them open. The Freedom Caucus chairman has been one of the nation’s most vocal critics of Obamacare, favoring legislation that ends insurance subsidies and makes deep cuts to Medicaid.

Any cuts to Medicaid would hurt rural hospitals, says Diane Calmus, government affairs and policy manager for the nonprofit National Rural Health Association. Seventy-five percent of patients in the Mission Health system—the nonprofit that runs Blue Ridge, Angel, and four other western North Carolina hospitals—are either uninsured or on Medicare or Medicaid. These hospitals were especially hard hit when the Republican-led North Carolina General Assembly refused to expand Medicaid in 2013. Eighteen other states made the same decision, and the impact was clear: more than 70 percent of the rural hospitals that shut down in the past seven years were in 16 of those states. Four hospitals in rural North Carolina have closed since 2013, and Blue Ridge has been losing money every fiscal year since 2013. Last year it lost $3.1 million. Charity care—services that no one pays for—at rural hospitals has increased more than 50 percent since Obamacare passed. “We have a rural hospital closure crisis,” Calmus says.

Holmes and other experts say the lack of Medicaid expansion is not the only cause of the crisis. They point to low Medicaid reimbursement rates, patients who can’t afford their deductibles, consolidation of hospital ownership, declining rural populations, medical staffing shortages, and a longstanding trend of Southern hospitals struggling to make ends meet. “You really have a death by a thousand paper cuts situation here,” Holmes says. But if a hospital wants to stay open, Calmus says, it may close a unit that is well-known for losing money: the maternity ward.

A recent study by researchers at the University of Minnesota found that more than half of the nation’s rural counties no longer have hospital obstetric services, and 9 percent of them lost those services between 2004 and 2014. Katy Kozhimannil, an associate professor at the University of Minnesota School of Public Health who co-authored the study, says hospital officials make these decisions only after weighing the community’s needs against their ability to keep their doors open. More than half of all births at rural hospitals are funded by Medicaid, but the program reimburses hospitals at half the rate private insurance would. Low birth rates in rural areas compound the problem, because there are fixed costs for maintaining around-the-clock nurses, technicians, doctors and equipment. Mothers in Yancey County, where Parker lives, had 182 babies in 2015, compared to mothers in Buncombe County, which contains Asheville, who had 2,625 babies that year. “Obstetrics… is not a money maker for hospitals anywhere,” Kozhimannil says. “At some point, it just becomes untenable to have the staff available.”

Mission Health officials say the decision to close the labor and delivery unit at Blue Ridge was not a financial one. They blame low birth rates at the hospital and concerns about “clinical quality and safety standards,” says Cara Truitt, regional advocacy director for Mission Health. Truitt pointed out that Blue Ridge had just one full-time obstetrician on call to deliver babies, and officials worried about providing the “general surgery support” needed to perform C-sections. By contrast, McDowell Hospital in Marion has three obstetricians, and Mission is currently investing $45 million to rebuild that hospital, with five new delivery rooms and a C-section suite slated to open next year.

But many of Blue Ridge’s doctors and nurses don’t buy that argument. In addition to the obstetrician, four other people currently deliver babies at Blue Ridge, and two of them are family practice physicians trained to perform C-sections. The real challenge, some argue, is not quality but quantity: Blue Ridge was projected to deliver 200 babies this year, which was not enough to offset its expenses. “It appears to us that the motive to close labor and delivery was largely financial,” the hospital’s medical providers wrote in a joint public statement released this summer. “Hospitals across the country face financial challenges. Labor and delivery units usually lose money.”

Mission concedes that the closure of Angel Medical Center’s labor and delivery unit was due, in part, to uncertainty over the future of Obamacare and the lack of Medicaid expansion in North Carolina. If the state had expanded Medicaid, Mission would be $8 million “better off,” instead of $34 million behind its budget goals, Mission CEO Ron Paulus told the local newspaper in May. (Paulus, through a spokesperson, declined to be interviewed for this story).

In April, senior Mission officials discussed the hospitals’ predicament with Meadows, who told local reporters he was shocked by the announcement that Angel’s labor and delivery unit would close. “Obviously it came as a bit of a surprise to me, but the decision was not predicated on anything we’re working on in regards to the repeal and replace of Obamacare—it was an independent business decision that was made,” Meadows told the Smoky Mountain News.

Meadows also denied that Medicaid expansion would have helped Angel keep its maternity ward open. “When looking at expanding Medicaid, it was mostly going to be for able-bodied single adults—that’s a totally different argument,” he said. In fact, pregnant mothers were covered by Medicaid before Obamacare passed. But Kozhimannil says an expansion would have sent more Medicaid payments to other parts of the hospital, and helped sustain money-losing operations, such as maternity wards.

Hospitals like Blue Ridge also receive special Medicaid funding, known as disproportionate share hospital payments (DSH), which help cover the cost of serving impoverished patients. Under Obamacare, those payments were supposed to disappear. In theory, they would be replaced by more patients receiving Medicaid coverage. But after many states refused to expand Medicaid, Congress repeatedly delayed the DSH funding cuts. They were slated to take effect on October 1, slashing $2 billion in federal funding from hospitals like Blue Ridge in the next fiscal year.

In May, Meadows said he was trying to find a way to avoid that funding cut. “I’m working with colleagues in the Senate on how we can work with what they call the disproportionate payment for Mission and other hospitals,” he told the Smoky Mountain News. “We now have to look at how we can make sure there’s incentive for taking care of those with critical needs and also keep providers financially viable.” It’s unclear if Meadows’ negotiations were successful. His press secretary did not respond to repeated requests for comment.

In the last week of September, the doctors at Blue Ridge delivered a baby every day, sometimes more than one. “The system is not ready for our department to close,” Dr. Dorothy DeGuzman said. DeGuzman, a family practice physician trained in high-risk obstetrics and C-sections, has been delivering babies at Blue Ridge for six years. Now she’s afraid the hospital will not be able to help women who need an emergency C-section. “And then a baby will die, and possibly a mother.”

A 2011 study of more than 49,000 pregnant women in Canada found that traveling more than an hour to give birth led to higher rates of babies being admitted to neonatal intensive care units. Mothers also have more unplanned deliveries when hospitals close their maternity wards. “They end up delivering in their car on the way to the hospital, on the side of the road, [or] in the emergency room,” Calmus says.

Truitt, the Mission spokesperson, downplayed such health risks. In the “very, very rare cases” when a women needs to give birth on her way to another hospital, she says, Blue Ridge can deliver the baby in its emergency room, and have an ambulance transport the mother and newborn to Asheville or Marion.

But DeGuzman also worries her more impoverished patients will stop going to their prenatal appointments, which could affect the health of their babies. Blue Ridge will continue to offer prenatal care, but many women prefer to see the same doctors for their pregnancies and delivery. Calmus says lower-income women might intend to drive to Asheville for such appointments, and then stop showing up because they have to take a day off work, or can’t afford the gas to drive three hours round trip. And they won’t have DeGuzman there to remind them. After she learned Blue Ridge’s maternity ward would shut down, DeGuzman accepted a job in California. She and the obstetrician who works at Blue Ridge are both leaving because they don’t want to stop delivering babies. This means the women of Yancey and Mitchell counties are losing two of the three doctors in the area who perform C-sections. “In rural America, many physicians are connected to the hospital, and when the hospital cuts service lines closes, they do lose that workforce,” Calmus says. “And the workforce doesn’t come back.”

The people who live near Spruce Pine understand what a loss this will be. This summer, families and doctors protested the closure of Blue Ridge’s maternity ward, and many were frustrated by Mission’s response. “They elected to close labor and delivery at Blue Ridge, sending us back to a level of care we have not experienced in this community since the 1960's or 70's,” Dr. Elizabeth Peverall, who cares for newborns at Blue Ridge, wrote in a letter to the editor of the local paper.

Some residents wonder how they will attract more young people and jobs to the area if mothers have no place to deliver their babies. Katie Willett, another patient of DeGuzman’s, said she would like to see a birth center open in the area. However, Kozhimannil, the University of Minnesota professor, says birth centers, which are primarily staffed by midwives, face many of the same financial challenges as hospitals. And it would be tough for one to open without a nearby obstetrics unit available to handle C-sections.

Meanwhile, Willett’s second child is due in February. She’s considering delivering at a birth center in Asheville, about an hour away from her home near Blue Ridge. But she’s not happy about it. “I’ve told Dorothy [DeGuzman], I can’t imagine this process—pregnancy and labor and delivery—not here and not with her by my side,” Willett says. If she goes into labor when it’s snowing in the middle of the night, Willett and her husband will pack extra blankets and water in their car and start driving toward Asheville or Marion—whichever path is safest. “Worst case scenario, I think we’d have to consider the road.”

Friday, September 15, 2017

Middle East - More than 70 new hospitals needed by 2022

Property consultant JLL estimates at least 70 new hospitals need to be built in five key Middle East cities by 2022.

The company’s newly released report on the regional healthcare sector concludes that the Middle East is lagging behind other developed economies in terms of per capita spending on healthcare and the provision of hospital beds.

Faced with a shortage of hospitals, clinics and other healthcare facilities, an ageing population and the rise of medical tourism, JLL estimates the cities of Cairo, Jeddah, Riyadh, Dubai and Abu Dhabi need to add a combined 10,500 hospital beds over the next five years, which equates to 70 new hospitals, just to maintain the current per capita bed provision.

JLL says the biggest requirement is in Cairo, which needs an additional 4,800 beds and 32 hospitals by 2022. Next is Riyadh, with 2,250 beds and 15 hospitals. The figures for Dubai are 1,050 beds and 7 hospitals, while Abu Dhabi has slightly higher requirements at 1,350 beds and 9 hospitals. The figures given for Jeddah are the same as for Dubai.

Even with this additional capacity, the per capita provision of hospital beds in the region will remain far behind the OECD average of 4.8 beds per 1,000 people, at 1.9 beds. To reach the OECD average, JLL says 470,000 additional beds would be required across the same five major cities by 2022, which equates to 3,130 new hospitals.

With such huge requirements, JLL says the healthcare market is highly attractive for real estate investors, offering a chance to diversify their portfolios in a sector not tied to the performance of the economy.


Monday, September 11, 2017

The ground has shifted on US health care reform: Opinion

— Congress's failed effort to undo Obamacare this year revealed an important political shift in the U.S.: Americans are no longer content to let people go without health insurance. As the Affordable Care Act has taken root, most have come to believe the federal government has a responsibility to make sure everyone is covered.

Republicans should take note: Another stab at destroying Obamacare is not what voters want. Instead, both parties should dedicate themselves to building on it — and, to that end, work is needed by the end of this month, when insurers are due to sign contracts to sell policies on the state exchanges next year.

To be sure, merely shoring up Obamacare won't bring universal coverage. The law has cut the number of uninsured by half, but 26 million people remain without coverage, and that number is expected to rise. To eliminate this gap, big new initiatives are needed: automatic enrollment of the uninsured into subsidized, no-frills plans, for example, or state programs that let people buy Medicaid policies.

For the moment, however, it's essential to keep the ACA functioning. President Donald Trump and Republicans in Congress have argued for dumping Obamacare and starting over, but the most sensible path toward universal coverage is to build on the progress already made toward that goal.

The immediate danger is that individual policies sold through state exchanges may be priced out of the market. This threat stems directly from the Trump administration's efforts to destabilize that market. Each month, the president holds out the possibility that he might refuse to reimburse insurers for lowering some policy holders' out-of-pocket costs, as the ACA provides. And this is driving insurers to either push up premiums or leave the market altogether.

Here are four things all advisors should know about the current state of single payer in California and beyond.

Congress could counteract the sabotage by expressly appropriating the subsidies, at least through 2018. It could also create a permanent federal reinsurance program to help insurers pay the biggest claims. Alaska and Minnesota have demonstrated how this strategy keeps premiums to a minimum.

Such steps will appeal more to Democrats than to Republicans — so in return Democrats should agree to allow states greater authority to determine the minimum requirements for insurance policies sold on the Obamacare exchanges. Some states, for example, would like to allow relatively cheap catastrophic-care policies combined with health savings accounts to be sold on their exchanges.

Republican Senator Lamar Alexander of Tennessee and Democratic Senator Patty Murray of Washington are having a conversation of this kind. Their push for legislation is made more urgent by the White House's continuing efforts to sow division. Most recently, the Trump administration slashed the ACA's advertising budget by 90 percent. If that results in fewer healthy customers being attracted to open enrollment this fall, premiums could rise higher.

Recognizing that the country's attitude to health care has shifted should make bipartisan compromise on the issue — hitherto hard to imagine — possible for the first time. Congress needs to stop fighting over Obamacare, and begin discussing how best to get from here to granting all Americans access to health insurance.


Friday, September 8, 2017

Effort Launches to Expand Medicaid in Maine Through Ballot Initiative

Mainers for Health Care officially launched their campaign to expand Medicaid though a ballot initiative this November.

Dr. Elizabeth Rothe, a family medicine physician at Central Maine Medical Center, says expanding the insurance program will not only help an estimated 70,000 Mainers, it will also help hospitals.
"Caring for patients who cannot pay their bills puts hospital budgets in the red," Rothe says. "It jeopardizes jobs, departments, and even entire hospitals. Maine needs to expand Medicaid."
Under the Affordable Care Act, states that expand Medicaid receive extra federal dollars. Maine lawmakers have approved expansion five times, but Governor LePage has vetoed the legislation.