[Senate Hearing 118-804]
[From the U.S. Government Publishing Office]
S. Hrg. 118-804
RURAL HEALTH CARE: SUPPORTING LIVES
AND IMPROVING COMMUNITIES
=======================================================================
HEARING
before the
COMMITTEE ON FINANCE
UNITED STATES SENATE
ONE HUNDRED EIGHTEENTH CONGRESS
SECOND SESSION
__________
MAY 16, 2024
__________
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Printed for the use of the Committee on Finance
______
U.S. GOVERNMENT PUBLISHING OFFICE
63-808--PDF WASHINGTON : 2026
COMMITTEE ON FINANCE
RON WYDEN, Oregon, Chairman
DEBBIE STABENOW, Michigan MIKE CRAPO, Idaho
MARIA CANTWELL, Washington CHUCK GRASSLEY, Iowa
ROBERT MENENDEZ, New Jersey JOHN CORNYN, Texas
THOMAS R. CARPER, Delaware JOHN THUNE, South Dakota
BENJAMIN L. CARDIN, Maryland TIM SCOTT, South Carolina
SHERROD BROWN, Ohio BILL CASSIDY, Louisiana
MICHAEL F. BENNET, Colorado JAMES LANKFORD, Oklahoma
ROBERT P. CASEY, Jr., Pennsylvania STEVE DAINES, Montana
MARK R. WARNER, Virginia TODD YOUNG, Indiana
SHELDON WHITEHOUSE, Rhode Island JOHN BARRASSO, Wyoming
MAGGIE HASSAN, New Hampshire RON JOHNSON, Wisconsin
CATHERINE CORTEZ MASTO, Nevada THOM TILLIS, North Carolina
ELIZABETH WARREN, Massachusetts MARSHA BLACKBURN, Tennessee
Joshua Sheinkman, Staff Director
Gregg Richard, Republican Staff Director
(II)
C O N T E N T S
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OPENING STATEMENTS
Page
Wyden, Hon. Ron, a U.S. Senator from Oregon, chairman, Committee
on Finance..................................................... 1
Lankford, Hon. James, a U.S. Senator from Oklahoma............... 3
WITNESSES
Topchik, Michael, executive director, Chartis Center for Rural
Health, Chicago, IL............................................ 6
Davis, Jeremy P., MHA, president and CEO, Grande Ronde Hospital,
La Grande, OR.................................................. 7
Rodefeld, Lori, MS, director of GME development, Wisconsin
Collaborative for Rural Graduate Medical Education (WCRGME),
Rural Wisconsin Health Cooperative, Sauk City, WI.............. 10
Mueller, Keith J., Ph.D., Gerhard Hartman professor of health
management and policy; director, Rural Policy Research
Institute (RUPRI); chair, RUPRI Health Panel; and director,
RUPRI Center for Rural Health Policy Analysis, College of
Public Health, University of Iowa, Iowa City, IA............... 12
ALPHABETICAL LISTING AND APPENDIX MATERIAL
Crapo, Hon. Mike:
Prepared statement........................................... 43
Davis, Jeremy P., MHA:
Testimony.................................................... 7
Prepared statement........................................... 44
Responses to questions from committee members................ 47
Lankford, Hon. James:
Opening Statement............................................ 3
Mueller, Keith J., Ph.D.:
Testimony.................................................... 12
Prepared statement........................................... 54
Responses to questions from committee members................ 61
Rodefeld, Lori, MS:
Testimony.................................................... 10
Prepared statement........................................... 73
Responses to questions from committee members................ 79
Topchik, Michael:
Testimony.................................................... 6
Prepared statement........................................... 85
Responses to questions from committee members................ 94
Warren, Hon. Elizabeth:
Letters submitted for the record............................. 97
Wyden, Hon. Ron:
Opening statement............................................ 1
Prepared statement........................................... 113
Communications
AFT.............................................................. 115
AHIP............................................................. 116
Air Methods Corporation.......................................... 120
Alliance for Home Dialysis....................................... 121
Alliance for Rural Hospital Access............................... 123
Alzheimer's Association and Alzheimer's Impact Movement.......... 129
American Academy of Family Physicians............................ 130
American Academy of Physician Associates......................... 138
American Association of Nurse Anesthesiology..................... 143
American Association of Nurse Practitioners...................... 147
American Hospital Association.................................... 155
American Medical Association..................................... 159
American Nurses Association...................................... 171
American Osteopathic Association................................. 175
American Physical Therapy Association............................ 178
American Society of Health-System Pharmacists.................... 182
Blue Cross Blue Shield Association............................... 183
Center for Healthcare Quality and Payment Reform................. 187
Coalition for Rural Medicare Equality............................ 196
Council of Academic Family Medicine.............................. 197
Edwards Lifesciences............................................. 198
Federation of American Hospitals................................. 201
Medical Group Management Association............................. 203
National Association of Chain Drug Stores........................ 207
National Association of Rural Health Clinics..................... 214
National Community Pharmacists Association....................... 216
National Rural Health Association................................ 219
Niskanen Center.................................................. 227
Premier Inc...................................................... 230
Rural Hospital Coalition......................................... 235
RURAL HEALTH CARE: SUPPORTING LIVES
AND IMPROVING COMMUNITIES
----------
THURSDAY, MAY 16, 2024
U.S. Senate,
Committee on Finance,
Washington, DC.
The hearing was convened, pursuant to notice, at 10:03
a.m., in Room SD-215, Dirksen Senate Office Building, Hon. Ron
Wyden (chairman of the committee) presiding.
Present: Senators Stabenow, Cantwell, Carper, Cardin,
Bennet, Casey, Warner, Whitehouse, Hassan, Cortez Masto,
Warren, Grassley, Thune, Cassidy, Lankford, Daines, Barrasso,
Johnson, and Blackburn.
Also present: Democratic staff: Shawn Bishop, Chief Health
Advisor; Marielle Kress, Senior Health Advisor; Joshua
Sheinkman, Staff Director; and Kripa Sreepada, Senior Health
Advisor. Republican staff: Erin Dempsey, Republican Deputy
Health Policy Director; Kellie McConnell, Health Policy
Director; and Gregg Richard, Staff Director.
OPENING STATEMENT OF HON. RON WYDEN, A U.S. SENATOR FROM
OREGON, CHAIRMAN, COMMITTEE ON FINANCE
The Chairman. The Finance Committee will come to order.
This morning, the committee gathers to discuss the challenges
and opportunities in rural communities when it comes to health
care, and I am going to be blunt. Without rural health care,
you cannot have rural life. It is just that simple.
And yet across the country, rural health providers are
struggling to keep their doors open. Too many hospitals,
doctors, pharmacies, and other providers in our rural
communities are now operating on a knife's edge. They are
forced to choose between balancing the books and continuing to
provide high-quality care to their communities. Half of all
rural hospitals across the country operate in the red. There is
no better example of this than what Oregonians in our Baker
County experienced over the past year.
In 1897, St. Elizabeth's Hospital opened in Baker City and
began to deliver babies. One hundred twenty-six years later,
after being acquired by Trinity Health, the sixth largest
hospital chain in the country, they closed their labor and
delivery unit with less than 60 days' notice. Trinity basically
said that delivering babies at St. Alphonsus was just a money-
loser.
Nobody saw it coming. The people of Baker City thought
their hospital could have a brighter future by joining Trinity
Health. When I arrived at a town hall in Baker City last year,
there were hundreds of outraged families, including a number of
expectant mothers who had planned to give birth at St.
Alphonsus.
The next closest hospital in that part of eastern Oregon is
45 miles away, along a freeway that can be closed during the
winter because of icy conditions, and there are also truck
crashes. In fact, that hospital, the Grande Ronde Hospital in
La Grande, OR is here today, and we are so glad that Mr. Davis
made the trek. I know a modest amount about most subjects, but
what I really know something about is airline schedules. And
for Mr. Davis to get across the country to be with all of us
today--it is a long trek, and we appreciate him coming.
Despite efforts at the Federal, State, and local levels,
St. Alphonsus in Baker City closed its labor and delivery unit
completely last August. The community battled St. Alphonsus to
keep basic labor and delivery equipment in Baker City, in the
event that the community can find their own solution in the
near future. Rather than find ways to keep their obstetrics
open, the hospital offered essentially a modest sum of money,
given their overall operations as part of the sixth largest
chain: $240,000. This lump sum amounts to less than $2,000 for
each year the hospital has been in the community.
What happened at St. Alphonsus is a textbook example of
what is happening in rural communities across the land. Our
view is, these communities deserve better. These Americans
deserve better. Between 2011 and 2021, one out of every four
rural hospitals in America stopped providing obstetric
services. That is 267 communities across the country where
giving birth locally is no longer an option. So, make no
mistake: if it is not practical to give birth within a
reasonable distance of your home, your community is facing the
prospect of becoming a maternity desert. In these areas,
aspiring parents are going to be forced to make tough decisions
about where they live and where they start a family.
Now, everybody knows that it is tough to get nurses, let
alone labor and delivery nurses, in rural areas. These
hospitals often see a low number of births each year and face
high costs to keep their services available. So today, I am
going to begin discussing a fresh approach with colleagues on
this committee that combines steps that can address the
economic realities in these communities with extra financial
support, as long as large hospital chains do not take the money
and run. My sense is that this is the kind of approach we can
come together on to deal with the times.
Let me mention two other areas briefly: telehealth and
workforce. Telehealth is vital to health care in rural
communities. It is a game changer for seniors to contact their
doctor through telehealth service instead of spending half the
day or more driving to the health clinic and back home. It is
enormously important for young families, who no longer have to
take the day off work to help their grandparent. I would just
mention--and I think Senator Stabenow remembers it from working
closely with me, Senator Lankford as well--when Chairman Hatch
and I came together to deal with the CHRONIC bill, the biggest
single piece was telemedicine.
And after we got it enacted, it essentially was sitting for
a while, and one afternoon I got a call from the Trump
administration. They said, ``How would you feel about using
your telemedicine provisions for the COVID challenge?'' And I
said, ``You are calling from the Trump administration? You want
to know how we feel that you would like to use our telehealth
provisions?'' I said, ``This is one of the coolest moments I
can remember. I am going to go off and have a hot fudge sundae
to celebrate. Thank you very much; we are in.'' Those were
provisions that came from the Senate Finance Committee that
were written in a bipartisan way. Telehealth is part of chronic
medicine, and we are the law of the land.
So, there is still more to do. I think it is just defying
common sense that clinicians in Idaho or Nevada have to jump
through extra hoops and pay for multiple licenses, just to
provide care via telehealth to a family in eastern Oregon. My
friend Senator Cantwell, who has been doing such good work on
aviation and a host of issues, I think is aware that a senior
in Vancouver, WA cannot receive care via telehealth from a
doctor across the Columbia River.
I heard that we have this new thing called the Internet,
you know--brand new. We ought to be able to figure this out.
With Senator Cantwell's leadership, we will be able to and
without mountains of bureaucracy.
The last point that I want to mention is the workforce
issue. Health-care jobs are so important. They are an economic
engine for rural Oregon. It is becoming more and more difficult
to attract qualified health-care workers to rural communities.
One of the things we have got to do is update the graduate
medical education program in Medicare, to make sure rural areas
and high-need urban areas are not given short shrift, and we
have to boost primary care. That is the backbone of the front
line of American health care. Senator Stabenow has done
particularly important work in this area.
And also, as a committee, we have begun to do this, looking
at innovative approaches like public-private partnerships, to
get into the high schools and start getting students interested
earlier in health care. We have always talked about the
community colleges. Every member here knows about that. I am
committed to getting more high school students, particularly
juniors and seniors, into these slots and bringing them into
the field.
So, lots to do here, and every member of this committee has
an interest in rural and underserved areas.
We have a great panel of witnesses, and Senator Lankford is
sitting in for Senator Crapo. We hope his health is good, and
Senator Lankford has been a leader on this committee on a host
of issues, including health care, but is also known as one of
our leaders with respect to charity care, which has been very
important to all of us.
Senator Lankford?
[The prepared statement of Chairman Wyden appears in the
appendix.]
OPENING STATEMENT OF HON. JAMES LANKFORD,
A U.S. SENATOR FROM OKLAHOMA
Senator Lankford. Thank you. Mr. Chairman, thank you. I do
want to submit for the record Ranking Member Crapo's opening
statement.
The Chairman. Without objection, so ordered.
[The prepared statement of Senator Crapo appears in the
appendix.]
Senator Lankford. Thank you. He would definitely be here to
be able to address that if he was feeling a little bit better
to be able to take that on. So let me say ``thank you'' to you
as well for hosting an event dealing with rural health care.
This is a very significant issue for Oklahoma, just like it
is for your State, and my State has 4 million people. Two
million of those live in urban areas, and 2 million of those
live in rural areas. So I understand well what it means to have
the critical needs hospitals in rural areas there. We have 40
rural access hospitals. We have three rural emergency
hospitals. We have seen several rural facilities close over the
last few years. In fact, one of the reports done by Chartis,
one of our witnesses here, shows that about a third of
Oklahoma's hospitals are at risk of closure, which ranks
Oklahoma as the State with the fourth highest number of
potential closures in the United States. So this particular
hearing is incredibly important to us in Oklahoma.
Rural health care, though, I do want to remind everyone, is
not just hospitals. It encompasses the entirety of the health
ecosystem from access to healthy foods, local pharmacies, the
independent family physician practices, emergency room access,
ambulances or air ambulance, insurance coverage, and insurance
networks. All of them are part of that ecosystem, and all are
vital access that we have spent some time talking about.
I would argue several things. Some of the issues that we
face in rural health care deal with things like physician
practices and hospitals and the administrative burdens that
they face. Rural providers and hospitals have fewer resources
to be able to maintain those practices, and they drown in some
of the administrative paperwork. So, whatever we can do to be
able to help them actually put more people taking care of
patients and fewer people back-
office is helpful to them.
Nursing homes have a very difficult time caring for
patients, but rural nursing homes have some of the most
difficult times, where they are dominantly funded by Medicaid
in their community, and they treat a higher level of acuity.
So, there are some very real challenges for rural nursing
homes.
The pharmacies and the reimbursements--they have some
reimbursements that are a lower reimbursement than the actual
purchase of the drugs that they stock. But the rural
pharmacies, especially independent pharmacies, are often the
only health-care provider in the community that they have
immediate access to. So, allowing that rural pharmacist to be
able to thrive is incredibly important in rural America.
Most importantly, we deal with the issue of patients. Rural
patients have an even harder time finding in-network providers,
especially as more and more rural hospitals stop accepting
Medicare Advantage--which we have had some of our rural
providers do in the area--or when there is a requirement for
prior authorization for certain testing, and you already drove
45 minutes to be able to get there. When you meet with your
doctor, and he says, ``We need to do a test, but you have got
to come back again before we can get authorization,'' that just
discourages them from ever getting that test again. It works
out well for the insurer; it does not work out well for the
patient in rural America.
So these are the issues that we have got to be able to deal
with: proper oversight of Medicare Advantage and the networks
in rural America; the long-term solutions to the Physician Fee
Schedule that we continue to be able to talk about; the PBM
reform legislation that this committee has passed
overwhelmingly we need to be able to move, because that is an
issue for rural independent pharmacies that is very
significant, that we have got out of this committee. We need to
be able to get it across the floor and be able to get that
resolved, as well as dealing with some of the CMS rules that
are out there, which I believe are a threat to rural nursing
homes with some of the staff requirements that are there, that
are going to actually pull RNs away from hospitals that are
already struggling to be able to maintain their RNs. To
maintain some of the new rules from CMS may make for an even
greater challenge for survival for some of those rural nursing
homes.
Senator Durbin and I have worked on a bill, the Rural
Hospital Closure Relief Act. That is one that we want to be
able to work through in trying to deal with the Critical Access
Hospitals. We have a lot of issues around the community health
centers. Those FQHCs have been a real solution for us in
Oklahoma and a lot of rural areas, and we will be able to
continue to be able to deal with that.
So, I would just say patients who are in rural Oklahoma
should not be punished for living in rural Oklahoma. They
should have access there that is consistent, and also be able
to face the unique issues that they have in rural America, to
be able to both live and thrive there. And for all of us who
like to eat food and wear clothes, we really need folks in
rural America who are in agriculture, and if we cut off access
to health care to them, then we are also going to lose access
to a lot of the rest of our economy. So, I look forward to this
conversation.
The Chairman. Thank you, Senator Lankford. I appreciate
your making it clear that food does not just fly out of the sky
and land up here on the dais, and I also appreciate your
comments about the pharmacy benefit manager legislation. It has
been bipartisan. You played a key role. It also speaks to this
middleman issue. We spend more than $4 trillion a year on
health care. We have got to get at this middleman question, and
we are looking at some of the work that Senator Lankford and
others did in terms of trying to make sure that we could really
get good value for the consumers on another bill that Senator
Crapo and I have to deal with drug shortages. So, I appreciate
this.
Okay. Michael Topchik is going to be our first witness,
executive director of the Chartis Center for Rural Health. He
has been a specialist in these rural networks. We appreciate
him.
Jeremy Davis I have already tried to give a send-off once
to, but you know we always like Oregon to get a little bit more
attention since we are 3,000 miles away. He is the CEO of
Grande Ronde Hospital, where I have been often, an independent
Critical Access Hospital in La Grande. He has led the hospital
in recruiting more clinicians and the first urgent care
facility. They are doing very important work there.
Lori Rodefeld serves as the director of GME development at
the Wisconsin Collaborative for Rural Graduate Medical
Education--a very experienced advocate in the field.
And Dr. Keith Mueller is director of rural policy research,
and he is at the Rural Policy Research Institute as well as the
Center for Rural Health Policy Analysis. That is a lot of hats
to wear; I do not know when you sleep, but thank you all for
being here.
We will begin with you, Mr. Topchik.
STATEMENT OF MICHAEL TOPCHIK, EXECUTIVE DIRECTOR,
CHARTIS CENTER FOR RURAL HEALTH, CHICAGO, IL
Mr. Topchik. Thank you very much, Chairman Wyden, Ranking
Member Crapo, Senator Lankford--I appreciate your remarks--and
members of the committee. Good morning, and thank you for the
opportunity to discuss the state of rural health and the
implications for the 46 million Americans who call rural
communities home. My name is Michael Topchik, and I am the
executive director of the Chartis Center for Rural Health.
Chartis is a Chicago-based advisory firm dedicated to helping
clients create and embrace solutions that make U.S. health care
more affordable, accessible, and safe, and my work with the
Center is exclusively focused on rural health care.
America's rural communities are older. They are less
affluent, and they are less healthy than their urban
counterparts. Rural Americans are more vulnerable than nonrural
Americans across nearly all of the population health metrics we
measure at the Center. Rates of the leading causes of death are
all higher in rural America, and the so-called ``deaths of
despair''--with suicides, the opioid epidemic, alcohol-related
deaths--are all much higher in rural America.
With that backdrop, recent history has been difficult for
the safety net serving these Americans, particularly hospitals.
Since 2010, we have lost 170 of these rural hospitals. Half--
half--of rural hospitals are now operating in the red. In
States that have yet to expand Medicaid, that number goes up to
55 percent. Even when hospitals do remain open, access to
care--access is such an important word in this hearing today--
access to care is constrained as facilities are challenged to
keep programs open. For example, we have lost 25 percent of the
Nation's rural obstetrics in the last decade.
The journey for labor and delivery for these expectant
mothers now means an additional 30, 45, or even 60 minutes for
that important life milestone. As tough as all of that sounds,
our research indicates that the future might be tougher still.
Using our data and analytic capabilities, we find 418
additional rural hospitals vulnerable to closure. Senator
Lankford, you mentioned some of those in Oklahoma that we are
worried about.
This is a national threat that will send shock waves
through communities if it is unchecked. When rural hospitals
close, accessing care becomes harder if not impossible, and
jobs in those communities--and jobs at the hospitals and
related jobs--they disappear.
There are really three key factors threatening rural
hospitals today. First, rural hospitals have high operating
costs, and they have low reimbursements. The unintended
consequences are related to things like sequestration. And bad
debt reimbursements, for example, continue to chip away at
rural hospitals' reimbursements. To counter operational and
financial pressure, nearly 60 percent of rural hospitals are
now affiliated with a health system. And while affiliation with
a health system is shown to bring services to communities and
to improve the bottom line--in our analysis it also is
protective against closure--it is not a panacea.
Second, rural hospitals treat a low volume of patients.
There are too few patients and even fewer medical professionals
to deliver care, meaning that for many hospitals, the math just
does not work.
Finally, rural hospitals are plagued by staffing
challenges. While rural hospital staffing shortages are not
new, the pandemic accelerated this crisis. These shortages
impact patient care today, and they threaten the introduction
and delivery of new services that communities will need
tomorrow.
I would like to share a quick anecdote that I think is on
all of our minds, which comes from Walmart. Within the last
month, it announced it is leaving the health-care delivery
space after just 5 years in this business. They cited staffing
and reimbursement challenges as amongst the chief reasons they
got out of this space. And so my question is, if Walmart cannot
figure this out with their scale and their capacity, how can we
expect rural hospitals and their communities that are
struggling to see a future in which their situation improves?
Let me finish by just saying that today's hearing is
important and timely. I have dedicated approximately the last
20 years of my career to advancing rural health care in
America, and I am deeply invested in helping rural hospitals
deliver quality, affordable care to some of our most vulnerable
communities.
I would like to express my sincere thanks to the Chartis
leadership team--including my colleague Anneliese Gerland, who
is with me today--who have stood by us in this important
mission-driven work, and also my colleagues at home: William
Balfour, Troy Brown, Melanie Pinette, and Ana Wiesse of the
Charter Center for Rural Health, whose research is fundamental
for the testimony today.
I would like to thank all of the members of the Finance
Committee and their staffs for the time and opportunity to
speak here today. I look forward to your questions. Thank you.
[The prepared statement of Mr. Topchik appears in the
appendix.]
The Chairman. Thanks very much; a great way to start.
Mr. Davis, welcome, and I so appreciate your being here to
tell the Oregon story.
STATEMENT OF JEREMY P. DAVIS, MHA, PRESIDENT AND CEO, GRANDE
RONDE HOSPITAL, LA GRANDE, OR
Mr. Davis. Chairman Wyden, Senator Lankford, and members of
the committee, thank you for the opportunity to speak today. My
name is Jeremy Davis, and I am the president and CEO of Grande
Ronde Hospital, a 25-bed not-for-profit independent Critical
Access Hospital in La Grande, OR. Located in rural eastern
Oregon, the hospital was founded in 1907. Grande Ronde Hospital
serves a local population of 26,000 residents and other parts
of frontier eastern Oregon and southeast Washington. My
community is located 260 miles east of Portland, OR and 170
miles northwest of Boise, ID along an interstate that
frequently closes due to weather or accidents.
On a personal note, I grew up 45 miles from this community,
so rural life, and now rural health care, is dear to me. Union
County is a mountainous area with a local economy based on
natural resources including farming, ranching, and timber.
About 15 percent of our population lives in poverty. In a most
recent needs assessment, we identified chronic disease
prevention, social determinants of health, and behavioral
health services as top priorities. Of the patients we see, over
60 percent are covered by government payers, with 41 percent
covered by Medicare and 23 percent covered by Medicaid. For
rural hospitals, a substantial portion of patients covered by
Medicare and Medicaid underscores the importance of adequate
reimbursement for these programs.
But reimbursement is only part of our challenge. The
aftershocks of the COVID-19 pandemic shifted the ground beneath
hospitals like mine, forcing us to make difficult decisions
about the services we provide. While many of the challenges we
face today were on the horizon, the pandemic exposed the
fragility of hospitals' financial foundations, particularly for
rural hospitals. Rising expenses, workforce shortages, stalled
revenue, and cratered hospital finances have put hospitals like
Grande Ronde in one of the worst overall financial positions
seen since 1993. Rural hospital administrators like me have an
interconnected list of worries that keep us up at night,
including workforce safety and shortages, financial stability,
and more recently worries about cybersecurity. And the next
emergency, whether natural, public health, or man-made, is
always just around the corner.
As wonderful as our rural lifestyle is, it can be a trial
for many rural residents, particularly those living in
communities surrounding La Grande, with no access to public
transportation. Patients often miss, reschedule, or even cancel
appointments, delaying needed care. Since 2007, we made an
early and significant investment in telemedicine, allowing us
to meet the challenges of delivering care in a rural setting,
which has resulted in a nationally recognized program.
Telemedicine provides access to specialists not available
locally, by tapping into specialty expertise typically only
available in larger cities. This includes using Telehospalist
for nightly call coverage, specialty physician teams when
patients present to our emergency department, and pediatric
specialists for our youngest patients. Investing in additional
equipment as well as configuring exam rooms' workspaces to
pivot quickly was the right thing to do. By extending
telehealth flexibilities permanently, we can create certainty
for Medicare beneficiaries, and certainty for providers like
Grande Ronde that cannot always afford to invest in these tools
without a reimbursement pathway.
Similar to our telemedicine commitments, our workforce
investments have been promising. We have reached out to
candidates across the spectrum of both primary and specialty
care, and through our recruitment efforts we have expanded
services and significantly improved access to care. In 2021,
our efforts to grow a behavioral health services program
attracted additional providers and meant better care for Union
County residents. Eight years ago, Grande Ronde Hospital
established a nurse residency program to attract, train, and
retain nurses. We are firm believers in growing our own, and
our model has attracted nurses from across Oregon. In 2019, we
created a nurse residency educator position to oversee the
program, which has enhanced its success. We also collaborate
with our local high school, and we are also a partner with the
Northeast Oregon Area Health Education Center, which hosts an
annual health career exploration camp for high school students.
Any Federal support that provides incentives and supports
for these types of programs should be a priority. Growing and
supporting our workforce and protecting and expanding services
are two sides of the same coin when it comes to rural health
care. Neither can be achieved without the other, and both
require adequate reimbursement and constant reinvestment.
Rural hospitals have to be especially creative to foster
and protect needed services, as we have done with our Children
and Recovering Mothers program, CHARM. CHARM is a confidential
health-care program for pregnant women struggling with alcohol
or drug addiction. It collaborates with local providers and
public health department officials to provide a program that
improves care and support for mothers and their infants.
Our maternal care investment helped us respond when our
neighboring hospital 45 miles away closed its obstetrical unit
in 2023. In preparation, we quickly added two FTEs and four RN
positions, which proved to be necessary as we have seen a 65-
percent increase in patients from the neighboring county since
the closure occurred. While we are committed to meeting this
need, decisions like this are a constant juggling of limited
financial resources and a balancing of larger workforce needs.
Let me close by commenting, in addition to extending
telehealth flexibilities, the following proposals will
specifically help us meet the substantial discharge challenges
we face in Oregon. One, permanently remove the 96-hour rule for
Critical Access Hospitals to allow us to serve patients longer
than 96 hours. Two, reestablish the swing bed flexibilities
allowed during the pandemic that expanded the ability of
hospitals to offer long-term care services to patients who do
not require acute care. Three, permanently waive the outdated
3-day hospital stay rule for patients requiring discharge to
skilled nursing facilities.
It is an honor and privilege to serve my rural community,
and thank you for this opportunity to be here today.
[The prepared statement of Mr. Davis appears in the
appendix.]
The Chairman. Thank you, Mr. Davis, and thank you for your
good work at home. And I particularly appreciate this effort to
try some fresh approaches to attract nurses, and your focus on
starting at home and in nearby communities is clearly an area
that has been underutilized. So good on you. I look forward to
asking some questions of you.
Ms. Rodefeld?
STATEMENT OF LORI RODEFELD, MS, DIRECTOR OF GME DEVELOPMENT,
WISCONSIN COLLABORATIVE FOR RURAL GRADUATE MEDICAL EDUCATION
(WCRGME), RURAL WISCONSIN HEALTH COOPERATIVE, SAUK CITY, WI
Ms. Rodefeld. Great. Chairman Wyden, Senator Lankford, and
members of the committee, my name is Lori Rodefeld, and I serve
as director of GME development for the Wisconsin Collaborative
for Rural GME. I also serve as the director of GME development
for the Rural Residency Planning and Development, and Teaching
Health Center Planning and Development Technical Assistance
Centers.
Rural health care has long faced challenges in recruiting
and retaining a qualified workforce. This is not just an
inconvenience; it threatens the fabric of the health care in
rural communities. Rural hospitals and health-care facilities
are already stretched thin, serving patients around the clock
to meet their community's needs. Unlike other industries, their
hours cannot be scaled back. Emergency rooms and patient
services, labor and delivery units are all critical services
that rely on a strong, stable workforce to keep the doors open.
My testimony will include examples from Wisconsin and
across the country, as we look to address rural workforce
shortages. I will highlight some innovative approaches that
help support rural physician training and the training of other
health professionals.
To address the doctor shortage in rural areas, the answer
is clear: invest in reality-based residency training. It is a
proven strategy that has been in place for decades.
Unfortunately, the growth of rural training has not kept pace
with the growth of GME as a whole. It is estimated that only 2
percent of residency training takes place in rural communities,
despite nearly 20 percent of our population living in rural
areas.
A common misconception is that rural hospitals cannot
participate in GME programs due to lack of interest,
infrastructure, volume, or experience, which simply is not
true. Efforts to grow training are emerging, with a number of
hospitals--ranging from larger full community hospitals with
multiple programs to Critical Access Hospitals to even health
centers--stepping up to become involved in rural GME.
In 2013, Wisconsin launched a GME development grant program
to help fund the launch of new residency programs. One of the
first hospitals to take advantage of this opportunity was the
SSM Memorial Hospital, which launched the first family medicine
program in the State in nearly 20 years. The program has seen
amazing success, retaining 50 percent of its graduates within
the health-care system. A majority are practicing in rural
areas, and 90 percent of graduates remain in the State of
Wisconsin. Since launching our State strategy, the total number
of rural GME positions has increased. We now have 27 programs,
up from 6 programs just a little over 12 years ago.
The success of RRPD is another example of growing interest
in the creation of rural GME programs. The program offers
startup funding and technical assistance to support residency
development. Forty-six new programs have achieved accreditation
by ACGME, translating into 575 additional positions when all
the programs reach their full capacity.
With the demonstrated success of expanding GME as a
workforce strategy, there is an opportunity to apply these
learnings to other health professions. There are countless
examples of rural facilities that have recognized this need and
worked to grow their own workforce. I will highlight a few
initiatives from Wisconsin and Minnesota. A Wisconsin grant
program was developed which mirrors our GME grant program that
I described earlier. Funding supports site development, and to
date over 50 new educational partnerships have been formed,
expanding training primarily in rural areas. This approach has
also been used in Minnesota. With the Medical Education and
Research Costs program, the State uses Medicaid funding to help
support the training of not just physicians, but other crucial
health professionals. The program supports training of social
workers, community health workers, paramedics, dental
therapists, and psychologists.
There is also an initiative focused on the training of
medical assistants in the State of Wisconsin, looking at ways
that we can better meet our underserved workforce needs. Since
this type of training can be offered through an apprenticeship
model, our health centers statewide have collaborated to
develop programs that will share virtual instruction and offer
hands-on training at local centers. MA positions are unique, as
they provide an entry point to other health careers.
Despite efforts to develop our workforce in rural
communities, significant challenges remain. As these issues are
complex, I will focus on only a couple of these challenges.
First, Medicare funding complexities do create a barrier to
expanding GME in rural areas. An example of this is GME funding
models for community hospitals and for sole Medicare-Dependent
Hospitals, which do not receive full support from Medicare to
cover the cost of training. Financial projections estimate that
their indirect medical education payments will be reduced for
most of these hospitals. Allowing full payments with IME for
these hospitals or treating them as nonhospital provider sites
in a manner similar to Critical Access Hospitals could be a
potential policy solution.
THCGME supports 81 residency programs, including 30 percent
of programs that train in rural communities. THCPD is
supporting the startup of 93 new programs, expanding its reach
even further. One program making an impact is the Marshall
University Consortium residency program, which will begin
training psychiatry residents later this year. The program will
provide services to a rural county in West Virginia without any
psychiatrists. There is not a current THCGME funding
opportunity for these grantees like Marshall, which is
committed to training doctors in rural areas.
Finally, the support of State-level technical assistance
and clinical training infrastructure, and Federal grants,
should be explored, to help rural facilities expand their
training. Assistance and support are needed for rural
hospitals.
Thank you for the opportunity to testify today. The future
of rural health care depends on our ability to cultivate a
strong workforce.
[The prepared statement of Ms. Rodefeld appears in the
appendix.]
The Chairman. Thank you, Ms. Rodefeld.
Welcome to our final guest, Dr. Mueller.
STATEMENT OF KEITH J. MUELLER, Ph.D., GERHARD HARTMAN PROFESSOR
OF HEALTH MANAGEMENT AND POLICY; DIRECTOR, RURAL POLICY
RESEARCH INSTITUTE (RUPRI); CHAIR, RUPRI HEALTH PANEL; AND
DIRECTOR, RUPRI CENTER FOR RURAL HEALTH POLICY ANALYSIS,
COLLEGE OF PUBLIC HEALTH, UNIVERSITY OF IOWA, IOWA CITY, IA
Dr. Mueller. Chairman Wyden, Ranking Member Crapo, members
of the Finance Committee, thank you for holding this hearing on
rural health. Since I last spoke to this committee in 2018,
intractable challenges in hospital finance, meeting workforce
needs, and addressing leading causes of death in rural
communities remain. Yet we have seen the resilience of health
providers and organizations, as they rose to meet the
challenges of the COVID-19 pandemic, and now keep their focus
on improving health for members of their communities.
In my brief formal comments, I will focus on rural
hospitals, Medicare Advantage, and Accountable Care
Organizations. Rural hospitals are now comprehensive care
centers, with a much higher percentage of total activities and
revenues tied to outpatient services. Transitioning to
institutions that best serve rural residents may require
modernizing facilities, investing in new information systems
and technologies, and collaborating with community-based
organizations to address living conditions related to chronic
health problems.
Additional capital investments in information systems,
including cybersecurity and in new technology, can stretch
capabilities of small hospitals which have operated on very
thin total margins and therefore lack reserves for large
investments. In a payment environment shifting to the
importance of addressing health, rural hospitals and primary
care clinics can be advantaged. However, rural hospital
administrators and their limited senior staff may lack the
experience and data analytics to leverage their position as
primary care providers in negotiations. Programs providing
technical assistance make a difference for those institutions.
Shifting to Medicare Advantage, the RUPRI Center for Rural
Health Policy Analysis, with funding from HRSA's Federal Office
of Rural Health Policy, has tracked rural enrollment since
October 2000, when a little over 200,000 beneficiaries were
enrolled in Medicare+Choice plans. As of March of this year,
there are nearly 4.8 million rural beneficiaries enrolled in MA
plans, which is 45 percent of all rural beneficiaries. Growth
in rural enrollment in many States has been dramatic since
2019, when nationally it was at 29 percent.
What are the consequences of growth in MA plan enrollment?
Well, it is a two-sided coin. On one side, as RUPRI has shown
in annual reports and periodic policy briefs, there are many
more choices now for rural beneficiaries. This includes more
widespread availability of additional health benefits,
including vision, hearing, fitness, and dental. As of 2022, all
are available in more than 90 percent of rural counties. On the
other side of the coin, MA plan payment to rural providers is
set through contracts, not the pricing system of traditional
Medicare. Consequently, strategies private insurance companies
use to control spending will apply: claims denial--which can be
appealed--prior approval, and variable deductibles and
copayments.
This coin metaphor brings to mind the term ``managed
competition,'' that in health care there is value to
competition, but given compelling objectives of access and
equity, some public policy management may be needed.
The number of ACOs grew to 480 in 2024, including 276 low-
revenue ACOs. The number of beneficiaries is holding somewhat
steady at 10.8 million nationally. There are more than 2,500
participating Rural Health Clinics in ACOs, and 513 Critical
Access Hospitals. Rule changes allowing up to 7 years in an
upside risk-only model and an advanced investment payment are
likely to result in more rural participation. RUPRI has
followed ACO development in rural places, and impacts on rural
providers, including finding a somewhat positive impact on
rural hospital revenues.
The RUPRI Health Panel, supported by the Helmsley
Charitable Trust, has written extensively on policy choices
since 1993. Based on our products and discussions with my
colleagues, I will close with what I characterize as sharp-
point concerns in rural health that demand attention.
The first is securing the workforce needed to sustain rural
services. A modern patient health team includes community
health workers, lay health navigators, behavioral health
providers, and of course, medical care providers. All are in
short supply and high demand. We need a multipronged approach
to meet these needs, from pipeline training programs, to better
pay and benefits, to improving workplace environments.
A second sharp point is maintaining essential services in
rural communities. As already discussed, this includes OB/GYN.
Perinatal and postnatal women must have equitable access to
high-quality care. Other essential services include emergency
care, primary care, and public health.
Thanks again for this opportunity to discuss critical
issues and policy considerations that would strengthen and
sustain essential health services in the Nation's rural
communities.
[The prepared statement of Dr. Mueller appears in the
appendix.]
The Chairman. Dr. Mueller, thanks very much. Excellent
panel.
Let me start with you, Mr. Topchik, and I know that you
have spent 20 years in the field, so you have really gotten a
sense of now how tough the math is in rural communities. You
have to maintain labor and delivery services; you have a low
number of births each year, yet you have high costs. And as
people sometimes say, you know, the babies do not always decide
to arrive between 9 and 5. You have to show up and be there
around the clock.
So, what we are trying to do is look at a better way to
invest in rural maternal health, without letting hospitals take
the money only to leave a maternity desert behind. What is your
sense about the direction that we are looking at now, where we
could have a fresh approach that really zeroes in on the
economic challenges in these rural communities that I
mentioned, and ensures that there would be a bit of extra
financial support for the big hospital chains, as long as they
do not take the money and run? Is that something that we can
work around?
Mr. Topchik. I think there is a robust discussion there,
Senator. The tension I see is access, access, access, versus
reimbursements and the dollars required. In the case of labor
and delivery, I think everybody here is for motherhood and
apple pie, and we absolutely need to invest more in motherhood
if we are going to sustain it in rural America.
The math is not adding up. We are losing it. The proof is
right before our very eyes, so it's very concerning. Health
systems play a role in investing in rural communities when very
difficult decisions, like the example you gave in Oregon,
arise. They are not taken lightly, and it is tough. It is tough
for the mothers. It is tough for the community. It is tough for
the doctors and hospitals that want to deliver those services.
What they are asking for in return is, can you help us with
the reimbursements to maintain this particular vital service,
but others as well? It could be chemotherapy; it could be
others.
The Chairman. We will want your input as we go on. You
know, the challenge is, it is not as if the rural hospitals and
providers are just left to go off and make the sensible
decisions that you are talking about. So many of the shots are
being called from thousands of miles away in these big chains.
And that is why we are going to want your good counsel as we go
forward, so that we can take the economic realities of these
rural communities and connect them to the fact that often these
judgments about whether, particularly these big hospitals, are
going to stay there and going to stay there for a significant
period of time--those decisions are being made thousands of
miles away from the rural communities where you are doing such
good work.
And I very much appreciate your leadership. We are going to
want to call on you.
Mr. Topchik. Thank you.
The Chairman. Let me go to you, Mr. Davis. Beyond the fact
that I know the community so well and they are doing such good
work with nurses, I think people would kind of like to hear the
Oregon secret sauce here. How did you manage to stay
independent all these years, when everybody, even as we have
been talking about, in the neighborhood is getting gobbled up?
You stayed independent in the face of increasing
consolidation and ownership by these big corporations. How did
you do it?
Mr. Davis. You know, that is a great question. It is one I
get asked a lot, and honestly, I ask myself that question often
as well. You know, when you look at us, it should not be the
case. We are one of five independent nongovernmental hospitals
left in the State of Oregon; there used to be six. And when you
look at the geography that we serve--very isolated frontier in
eastern Oregon--we have a lot of things stacked against us.
And there are a couple of things that I think add to the
secret sauce. One is, the hospital in La Grande was started in
1907 by four local physicians, and I think whatever they did
back in 1907, that culture and that vision that they set
forward has carried us through today. I think there is a grit
in eastern Oregon that ties back to the Oregon pioneers. We
have just had to figure out ways to solve our own problems.
And typically, when we are asking for help, we are looking
for a hand up, not a handout. I think the fact that we are
independent--one of the reasons I think we have remained
independent is, we have really good governance. We have a local
board of trustees that is dedicated, committed to the success
of the organization. Our board actually leaves LaGrande once a
year and goes to a conference together to learn about emerging
trends, emerging innovations, so we can figure out ways to try
to bring those back into our local community, so we can, again,
take care of our local community.
We are a rare breed in the fact that it is local decisions
and local money, and there are some things that have helped us.
Strong leadership--we have had two CEOs now in the last 40
years, and my predecessor was there for 35, so I cannot take
credit for a lot of that.
But I cannot think--I betcha there are not many large or
small hospitals in this country that can say they have had two
hospital CEOs in the last 40 years. So, stable leadership
certainly matters. Not to say that we are perfect; we make
mistakes. But there has been a commitment in leadership to stay
and see the vision and see the care through. We have a great
team of physicians and staff.
Dr. Hunsaker told me when I first arrived in La Grande that
we fight above our weight class here, and to me that is a
testament to our medical staff, that they too are committed to
drive decisions and challenge administration and find creative
ways to provide as much care locally as we can, and that has
carried us through.
And then I would say, when you are doing good things, good
things happen, and then there is a little bit of luck. But
Oregon certainly being a State that was an earlier expansion
State for Medicaid certainly helped. And we know the data bears
out that the States that did not expand Medicaid--the majority
of rural hospitals that are vulnerable to closure in this
country are in those States.
So, I think there are a lot of things that Oregon has done
right, and then there are a lot of great people in La Grande
who have gotten us to where we are today.
The Chairman. You really are a poster child for the kind of
nuts and bolts work we have ahead of us, and we are throwing
bouquets to everybody in eastern Oregon. We want to throw some
your way, because leadership starts at the top. Good work, and
we are going to be calling on you, sir.
Senator Lankford is next.
Senator Lankford. Thank you. Thanks to all of our
witnesses. I appreciate the work very much.
Mr. Topchik, I want to be able to drill down with you a
little bit. You have been at this for 2 decades and getting a
chance to be able to research rural hospitals. We were not
dealing with the number of rural hospital closures 3 decades
ago that we are now. So, what has shifted in those 3 decades,
that 3 decades ago we were opening rural hospitals, and now we
are closing rural hospitals? What has shifted?
Mr. Topchik. Rural hospitals predominantly rely upon
Medicare and Medicaid reimbursements, and as rural hospitals'
expenses have continued to climb--especially recently with the
inflationary pressures--staffing challenges have continued to
grow. New technologies are required to do business today that
did not exist 3 decades ago. All of this is very expensive, and
the reimbursements have not kept up. I think that is the simple
answer. We see declining reimbursements relative to the fixed
costs of operations.
Senator Lankford. What do those reimbursements need to be
for a rural hospital, as far as a percentage increase, to be
able to make the math work for them? And I know it is going to
be different for different hospitals. I understand the
administrative structure, so it is not one-size-fits-all, but
what are we talking about?
Mr. Topchik. Right. I think it was this committee, under
Senator Baucus's leadership, that recognized this low-volume
problem, and we created a cost-based reimbursement system,
cost-based plus. And over time--if my consulting peers would
suggest that even at the beginning of that program it was
probably in the high 90th percentile of the actual costs of
running a hospital, today, what we hear is, it is probably more
like 90 percent. So, what that difference is and how to make up
for that, I think, is something that we would need to look at
more carefully. But your question is spot-on. There is a lack
of reimbursement, and that gap, it continues to widen, as we
have seen.
You know, 10 years ago, Senator, when I was looking at this
data, a third of rural hospitals were in the red, and today it
is 50 percent.
Senator Lankford. Right. So the challenge has been staffing
for rural hospitals. That has been significant. There is a new
CMS rule that is out right now dealing with staffing for
nursing homes, which I think, disproportionately, will hit
rural nursing homes as well in staffing. Their solution to
increase the quality in nursing homes is just increase the
staffing; just hire more people, and to be able to add into it.
The challenge that I have is, obviously, if they are going to
hire more nurses there at rural nursing homes, they are going
to come take them from rural hospitals to be able to get there,
to be able to maintain this.
There are a limited number of people who are already there
to be able to do it. How do we deal with the staffing issues in
rural America, knowing that the DC solution is just, if there
is not enough staff, just hire more people. How do we deal with
that?
Mr. Topchik. Senator, I appreciate the question. The entire
panel was having a discussion in the antechamber just before
this about threading that needle and how challenging it is. I
think all of us can get behind additional staffing and higher
quality of care for our seniors in long-term care.
I am comforted when I look at the final rule, that there
were recognitions of rural challenges around being in a health-
care professional shortage area to begin with. How can we, if
we are in a shortage area, meet these challenges? But I saw
then provisions to give a timeline that was extended, as well
as waivers in those cases where it is not possible. So, on the
one hand, threading the needle, Senator--I like the idea of
increased quality of care for my dad, for example, but I
totally understand that the hospitals that I serve, they are
now facing an additional burden, and that is the challenge.
Senator Lankford. Yes. It is a challenge. When I went
through the rule as well, you have 3 years to get there for an
urban and 5 years to be able to get there for a rural. I think
the challenge is going to be that the urban is going to
basically hire as many people as they possibly can, and it puts
the rural behind them, even farther behind, because the urban
has a faster deadline to be able to get there.
The other challenge is going to be waivers, as you
mentioned before. If you request a waiver and get it, you have
to publicly display that you have a waiver, that you are
operating under a waiver. You have to tell every future family
that is considering you, you are operating under a waiver. So,
while you could request a waiver, it seems like the first step
toward closure, to announce that you have a waiver. Because now
you are not going to have families take you up on it, because
they are going to go, okay, you are a problem facility, you are
operating under a waiver. So it puts a stigma on you right at
the beginning, which I think would decline even faster there.
So, there are some real challenges on the waiver process that,
I think, actually will lead to more rural closures than
actually more opportunities there. Time will tell on that, but
that is one I am hopeful that CMS will actually take up, and be
able to take a harder look at that same issue on this.
For all of you, I would love to be able to sit and visit
with you for hours, because we have lots of questions on it.
But obviously, there are a lot of us who want to be able to
drill down on these issues. Thanks for your testimony and for
the time you have been able to put into this. Thank you.
The Chairman. Important questions, Senator Lankford.
Senator Stabenow?
Senator Stabenow. Well, thank you very much, Mr. Chairman.
And first let me say to our acting ranking member, my mom grew
up in--was born and raised in Oklahoma and came to Michigan
when she married my dad and worked at a rural hospital. She was
director of nursing at the hospital where I grew up, and so----
Senator Lankford. You are welcome to retire and come to
Oklahoma. [Laughter.]
Senator Stabenow. Yes. I keep telling her now, though she
is 97 years old, that with 42 years in nursing, she could
probably get whatever salary she wanted. So, I grew up around
the hospital and around rural health care, and I really
appreciate all of your work and what you are doing.
I do want to say, there are so many different fronts we
need to work on. Reimbursement is critical, and staffing, and
so on. I mean, there is some good news around high-speed
Internet access. We are pushing to do that so that everywhere
telehealth is available--and there are other things. We had a
lot of recent success on creating certified behavioral health
centers fully funded under Medicaid, getting those into rural
areas. That is positive.
But we have a lot of work to do around what you were
talking about today, and in addition to hospitals, I just also
want to lift up another area that I have been working a lot on,
and that is our home health care sector, where
disproportionately we have seen cuts and cuts, and they fall on
small home health agencies.
We have lost more than 1,000 home health agencies so far,
despite huge demand for home health. So I am very concerned
about what is happening in rural communities for home health as
well.
In my position as chair of the Agriculture, Nutrition, and
Forestry Committee, I recently introduced a version of the 5-
year farm bill, the Rural Prosperity and Food Security Act. I
mention this because, important to this hearing, it makes
critical investments in rural health by expanding access to
capital for rural health-care facilities through the Community
Facilities Programs--supporting access to distance learning and
telemedicine grants for projects, for behavioral health as
well--and we reauthorize something called the Farm and Ranch
Stress Assistance Network program related to mental health.
And so, Dr. Mueller, I wanted to ask you. You mentioned the
role of USDA's Community Facilities Programs in your testimony
in helping rural hospitals invest in meeting the needs of
patients. I wonder if you might speak at all to our efforts to
extend the loan and grant flexibilities in the Community
Facilities Programs, to allow awards to be used more broadly
for medical supplies, increasing telehealth capabilities, and
meeting staff needs. And could you speak to the impact on rural
hospitals and why we need an, I think, all-hands-on-deck
approach--not just the Finance Committee, but in every
committee that touches on rural health?
Dr. Mueller. Thank you for the question, Senator Stabenow.
As Mr. Davis pointed out, it takes a lot of investment in new
technologies to maintain the role of the hospital in the
community, and the USDA is vital in doing that with the
community programs, as you mentioned.
I think expanding that into different realms of utilization
that help with telehealth, in particular, in making that
readily available, is important. I think associated with that,
USDA, about 2 or 3 years ago now, started up a technical
assistance program to help those hospitals that have, as I
mentioned in my testimony, very little administrative core
staffing and analytic capability, to come in with some
technical assistance to help them deal with the new
technologies and information systems, with the new technologies
in telehealth, and with utilizing their information in
negotiation and payment contracting.
I think all of that is important, and it is good to see
that USDA in the new farm bill would continue that investment
as well.
Senator Stabenow. Thank you.
Just quickly, Mr. Davis, in looking at all the work you are
doing in nursing and all of the behavioral health and all of
the important areas, in the Affordable Care Act, I authored a
demonstration for a graduate nursing education program. We
found that it led to a 54-percent increase in advanced practice
registered nursing enrollment, and a 67-percent increase in
graduation, and we would like to make that permanent. There is
a group of us who have put in legislation to make a national
graduate nursing education program permanent. I wonder if you
might speak to that as a possibility.
Mr. Davis. Sure. Yes, I think anything that you can do to
stabilize the workforce and create a pathway--instead of
extending some of these avenues--would certainly be
advantageous for rural hospitals, because we are constantly--it
seems like there is always a cliff. There is something that is
being extended, and you are wondering, is it going to be
extended, is it going to be extended?
And so, I think making those things permanent would
certainly free up some of our time to focus on some of the more
mission-
critical work that we have in front of us.
Senator Stabenow. Thank you, Mr. Chairman.
The Chairman. I thank my colleague. And so our panel knows,
Senator Stabenow has been our leader on these behavioral health
issues. So, as we go forward, we are going to have some
opportunities. I am not just talking about the lame duck
session. We have a lot of health-care work to do. So your
testimony, your presence here today, is very timely.
Next is Senator Grassley.
Senator Grassley. Dr. Mueller, we welcome you back to the
committee again. We appreciate your insight on rural health
care and keeping in touch with us.
Mr. Chairman, I want to say, I share your interest in
improving maternal and child health. When I was chairman of
this committee, we sought stakeholder feedback to improve
maternal health.
I have also introduced the Healthy Moms and Babies Act with
Senator Hassan. Our bill seeks to improve the economics of
rural labor and delivery units through a health home model, to
make sure that we are using modern technology in maternity care
and reducing the unacceptable rise of maternal mortality rates.
I hope this committee can work in a bipartisan way to advance
this
common-sense idea.
Now I go to Dr. Mueller. Over 600 rural hospitals benefit
from the Casey-Grassley Rural Hospital Support Act. The bill
permanently extends the Medicare-Dependent Hospital and Low-
Volume Hospital programs. Congress has reauthorized these
programs more than seven times. We have other rural hospital
Medicare programs that offer flexibility and support for rural
hospitals, but those programs have not been made permanent. Why
is it important for there to be flexible and targeted rural
hospital programs under Medicare, and why should they be made
permanent?
Dr. Mueller. I think it is important to have those
programs, as you have heard today in the testimony,
particularly from Mr. Davis and Mr. Topchik. The current
financial situation for a lot of hospitals across the country,
including the 85 Critical Access Hospitals in Iowa, is
precarious.
I think the reason to make those programs permanent--again,
Mr. Davis's comments were spot-on just a couple of minutes ago
when he talked about how you get to a cliff of, oh, what is
going to happen now that the program is going to run out in 2
months, and do I need to start preparing for that? You spend
valuable, precious management time trying to work through
scenarios that you should not have to. You should be able to
rely on what the reimbursement rate will be going forward.
I think we also need to continue to work on increased
flexibility of how the dollars are used by rural hospitals, so
that you can take some revenue streams and convert the revenue
from direct patient care, get that funded appropriately, and
have a revenue stream for some of the new administrative tasks
and the task of meeting health-care needs in the community
through collaborations with community-based organizations.
Senator Grassley. Yes; thank you, Dr. Mueller.
Ms. Rodefeld, CMS is currently distributing 1,200
additional graduate medical education slots. With the 400 slots
already distributed, I am very concerned CMS is not meeting the
rural and underserved thresholds as required in the 2020 law
that I helped pass when I was chairman of this committee.
When I wrote CMS last year, they responded that they are
meeting the rural threshold by counting urban hospitals that
are reclassified as rural. The agency also cited a lack of
rural hospital applications. So my question is, are rural
hospitals getting a fair look for additional residency slots,
and what can CMS be doing to help rural hospitals apply and be
competitive?
Ms. Rodefeld. Thank you for the question. I was part of a
team that did an analysis of the round 2 slot distribution, and
we are seeing that rural hospitals are not being prioritized
for slots because of the issue you mentioned with rural
referral centers. The legislation used the language ``treated
as rural,'' which does include those nongeographically rural
hospitals in the distribution of slots. There are a number of
barriers to getting rural hospitals to apply. We have a
relatively low number of rural residency programs. I think it
was around 150 in 2022. So, when you add in factors like having
to have a HPSA designation, then that narrows the pool even
further of hospitals that are going to apply.
But I would like to note that we have one geographically
rural hospital in Wisconsin, Marshfield Clinic, that has
applied in the first two rounds of slot distributions and has
not received slots, because CMS prioritizes based on HPSA
designation. Other hospitals that do not have a HPSA
designation have not applied. I know I had a program director
in one of our Wisconsin hospitals with a CMS MEARIS application
open just a couple of months ago. He was eager to apply, expand
his program, and I had to break it to him that because he was
not located in a HPSA, he cannot apply for those slots.
So I think that any future slot distributions should pay
attention to whether there is a HPSA designation requirement in
order to apply. You know, I think gatekeeping programs that are
successful out of this process is kind of unfair. They are
still rural hospitals, they are still doing a great job in
recruiting residents and retaining them in their communities.
Senator Grassley. I will submit some questions for the
record.
The Chairman. Thank you, Senator Grassley. And I just want
to note for our guests and the members, you and I have taken on
some big health-care giants over the years. And I think part of
this--and I think you had to be out of the room at the time--is
how can we respond to the changes, particularly in rural
communities, as it relates to health care. And Mr. Topchik and
all of our guests have done it, and at the same time say, okay,
if you are going to make a commitment to stay and to work with
the community, you are not just taking the money and running.
And we may be able to give them some extra help. So, very good
to have you here, and I look forward to working with you.
Senator Cassidy?
Senator Cassidy. Mr. Davis, everybody is familiar with the
Change--the UnitedHealth issue, where there was a hack. And
speaking to Andrew Witty, the CEO of United, he said that they
will update software if any software is more than two
generations old. So, if Windows 15 is the latest version,
anything older than Windows 13 is replaced.
And exploring this with him, it is my impression though
that a lot of rural hospitals would have Windows 5, and I am
not blaming them. I am saying when you have thin margins with a
lousy payer mix, there is a limit to how much you can put into
reinvestment.
So frankly, there may not be the people. If you need
somebody onsite to service, then you need to have people living
in a rural community to service, or driving there from
someplace else. Any thoughts about this? I mean, I was pursuing
if this is a point of vulnerability for Change, that we have
people billing from places where cybersecurity may not be
strong. He assured me that their software would attempt to
intercept that, but the point is--you see where I am going with
this?
Mr. Davis. Yes. It is a great question. You know, I think
the reality is that the industry is heavily reliant on
technology. And so, we have to keep up, and we really cannot
defer upgrading some of our basic infrastructure in terms of
computing power, whether it is Windows ME or Windows 1 or
Windows 11. Obviously, there is a grace period there when you
update and replace. But there is so much technology, whether it
is imaging, whether it is nuclear medicine, whether it is
cardiac, and we would not be able to render care if we do not
have adequate infrastructure----
Senator Cassidy. So, I understand the infrastructure is
necessary.
Mr. Davis. Yes.
Senator Cassidy. Obviously, if you do not have an MRI, you
cannot do an MRI.
Mr. Davis. Right.
Senator Cassidy. But you are going to have to bill it no
matter what, and now everything is billed electronically.
Mr. Davis. Right, right.
Senator Cassidy. And so, what is the general state, do you
know--or perhaps this is a question for Dr. Mueller. What is
the general state, do you know, of rural hospital cyber
infrastructure? You know, is it like, somebody just resident
and all in the thing, or are they in the cloud? Do you see
where I am going with this?
Mr. Davis. Sure. Yes, well a couple of points. One is, I
can tell you that since 2019, our cyber insurance premiums have
gone up by 608 percent.
Senator Cassidy. Okay, but I have limited time. Do you have
a sense of--or maybe I will just go to Dr. Mueller. Dr.
Mueller, do you have a sense of what is the kind of general
state of what we have been speaking of at the average rural
hospital?
Dr. Mueller. Frankly, no. That is something that I will
follow up on.
Senator Cassidy. Okay; thanks.
Now the next thing: Obamacare--and we are going to be
revisiting Obamacare next year--expanded Medicaid. But
Medicaid, absent of a program like UPL or Disproportionate
Share, when I speak to hospitals, frankly it is such a lousy
payer they cannot keep the doors open with it. And they use
340B to subsidize. They use other things to subsidize, and I
say that because I was just visiting an urban hospital in
California, and they were telling me that Medi-Cal pays so
poorly that they are worried--and this is an urban hospital
system--that Medi-Cal is paying poorly.
So, what advice would you give to us as we look to
reauthorizing some of these programs, recognizing that there is
the essential nature of an adequate payer mix, and an adequate
payment from that mix in order to keep the hospitals open? Mr.
Davis?
Mr. Davis. Yes. So adequate reimbursement and stable
reimbursement are absolutely critical. You know, many rural
hospitals have over 60 percent of their payer mix as either
Medicare or Medicaid, obviously, with the UPL and Medicaid
expansion, 340B, a lot of programs that are meant to help
subsidize inadequate reimbursement.
So, anything I think that this committee and Congress can
do to pay providers adequate reimbursement for the cost that it
takes to render the service----
Senator Cassidy. Now, the providers and the hospitals do
have those subsidies, but the physician typically does not.
Mr. Davis. Correct.
Senator Cassidy. And so, the physician, if she or he is
attempting a private practice say, it is going to be sucking
wind if you have that kind of payer mix. Mr. Topchik, how would
you respond to this?
Mr. Topchik. I would echo Mr. Davis's comments, in that the
mix is problematic to begin with. You mentioned two primary
government payers that drive rural reimbursements, and they
have----
Senator Cassidy. Medicare and Medicaid drive lower
reimbursement?
Mr. Topchik. Yes, and they have eroded, sir----
Senator Cassidy. Yes, and I think we could add CHIP to that
too, because that is usually a Medicaid rate. I am almost out
of time. I will yield; thank you.
The Chairman. Thanks to you.
Senator Johnson is next.
Senator Johnson. Thank you, Mr. Chairman.
Ms. Rodefeld, first of all, welcome. It is always nice to
have witnesses from our home State. You are familiar with what
is happening with the two hospital closures in Chippewa Falls
and Eau Claire.
I always like to look back in time. You know, these are
hospitals--I met with their representatives--I think they have
served the community for over 100 years. I met with these
representatives just yesterday, and the description of why they
closed is different than what has been provided here. And
again, I do not dispute your three main points. But as it was
described to me, what happened is, you had private equity-owned
hospitals move into the area, pretty well skim off the private-
sector patients, leaving these hospitals with Medicare and
Medicaid patients so that, due to low reimbursement, they just
simply cannot survive.
Is that an inaccurate assessment in terms of your
understanding of what happened there?
Ms. Rodefeld. I think the situation up in the Eau Claire
region, it is very tragic, it is very complicated, and I know
that there are a lot of ripple effects from that. I know there
are private practices that now cannot get privileges at the two
health systems that remain in that region. But my understanding
is that the hospital that closed in Eau Claire was a safety-net
hospital. Reimbursements were a factor in the closure. I do not
know that it was the only factor in leading to the closure.
Unfortunately, it did lead to the closure of two residency
programs, one rural track in Augusta and another in Eau Claire.
So that has been a really significant hit for the workforce
in northern Wisconsin as well. So again, really sad to see that
hospital closure, because they were meeting a huge need.
Senator Johnson. So, there are always multiple factors in
just about anything, but again, as the representatives related
to me, that was the primary factor right there you know,
private-equity hospitals skimming off the private-sector
patients and leaving them with government-run health-care
reimbursements.
And that is the point. I mean, we need to take a look at
this. The model for rural health care/rural hospitals worked
for 100 years, up to a point something changed. You know, one
thing I have been encouraged by--because this is not just about
rural hospitals, this is about rural health care--is the growth
in direct primary care operations or clinics. And there are
over 2,300 nationally. There are 86 in Wisconsin. I have
visited some of them. I will say the health-care providers, the
doctors, and nurses, really enjoy it. What happens is, they
just opt out of Medicare so they are not subject to all the
rules, all the regulations.
They charge really reasonable prices. I think it is
somewhere around a $50 to $100 per month subscription fee. I
know when I was there a couple of years ago, it was $55 for a
half-hour visit. Now, they do not have all the resources. They
need hospitals for testing, that type of thing. But some
combination of clinics that are kind of outside the system,
that are not harmed by the system, are not harmed by all that.
Together let's try and figure out some way to get control
of our financing system. But just comment, just in terms of
these direct primary care clinics. Are you familiar with them
in Wisconsin, and does your hospital system, do they cooperate
with these?
Ms. Rodefeld. So, I do not work for a hospital system any
longer. But I know--yes, I am familiar with many direct primary
care practices, and it does simplify everything, and it is not
just Medicare and Medicaid. It is also working with private
insurance, the paperwork, preauthorization. There are a lot of
things we need to address within health care beyond government
payments. You know, the insurance companies also do require a
lot of our primary care physicians, whether they are in private
practice or not.
Senator Johnson. The reason I keep bringing this up is, I
want the committee to think outside the box, you know, kind of
travel back in time and take a look at, well, it worked then.
What has changed? Maybe the solution is to kind of go back to
the way things operated back then, when doctors were
independent instead of 80 percent employed, when you did not
have all these rules and regulations, where government-run
health care did not drive the entire bus in terms of
reimbursement rates and just how to practice medicine.
And again, that is where I suggest to the committee
members, just take a look at some of these models and think
innovatively. Is there some way we can integrate this, because
in these hearings we are always hearing that one of the
solutions is, we have to increase competition. But then nobody
ever talks about how to actually increase competition. It is
always about a new government program or a new grant program--
and again, I realize free Federal money is great. It just does
not solve the problem. I would argue it oftentimes exacerbates
the problem.
So anyway, I appreciate you coming here; I appreciate the
testimony.
Thank you, Mr. Chairman.
The Chairman. Thank you, Senator Johnson.
Senator Whitehouse is next.
Senator Whitehouse. Thank you very much, Mr. Chairman.
Thank you to the panel for being here.
Dr. Mueller, you talked about ACOs in your testimony, and
we are looking at changing the rules for prior authorizations
to essentially bar prior authorization requirements with
respect to ACOs, as long as the ACOs are operating effectively,
unless they go to CMS and get prior authorization to have a
prior authorization. Because it strikes me that in the fee-for-
service system, there is a danger to the payer of a medical
practice trying to run up bills by doing the most expensive
treatments and doing additional unnecessary treatments. So one
can argue that prior authorization in that fee-for-service
environment is a necessary check on the behavior of the
provider.
We can argue that, but at least it is a proposition out
there. To me, the proposition completely evaporates when you
are dealing with an ACO or other value-based care model, where
the doctor on the ground making the decisions about the
patient's care is just as motivated to not engage in
unnecessary and excessive expenditure as the insurer. And I
would be interested in your comment on what sense it makes to
allow prior authorization requirements for providers operating
successfully in the ACO model.
Dr. Mueller. That is a great point, and I like the way you
phrased it in the larger value-based payment arena, in which
you are trying to change the incentives for everyone, including
the providers, so that they understand if they add an
additional procedure that is going to cost more, they will
exceed expenditure targets, and they will have to pay back.
So they do have the incentives to keep the utilization
down. So I think that is an appropriate way to begin to think
about whether we do not need to have prior authorization. That
would also create frankly--as a researcher, in my mind I am
thinking that would be a great source of data then for us to
investigate what happened when you lifted prior authorization
as a requirement. Did utilization spike up or not, and did
appropriate utilization remain in place? I believe it would
work.
Senator Whitehouse. Not to mention an inducement and a
reward for, particularly primary care practices that go through
the ordeal of becoming an ACO and setting up their systems to
report that way and change their business model to operate that
way. So I hope we can get that done, and I appreciate your
thoughts on it.
Mr. Davis, I wanted to ask you about telehealth. We are
working on a bill. It is called the TREATS Act, that would
extend the ability that we created during the COVID pandemic
for patients with opioid disorder to get treatment and
prescriptions via telehealth.
It makes perfect sense, seems to have worked very well. It
is expiring. Could you comment on whether letting it expire is
a good idea, and how the access to telehealth is of particular
advantage to patients in rural communities?
Mr. Davis. I think anything that we can do to extend the
waivers and flexibilities around telehealth would be a godsend,
especially, I would say, payment parity. There is a significant
pay discrepancy between an in-person visit, versus a telehealth
appointment.
I know early on in the pandemic, you probably could have
heard a collective sigh of relief when we saw that we were
going to be able to get paid the same for a telehealth visit,
as well as an in-person visit. And then in terms of behavioral
health/substance abuse disorder, absolutely.
There is a shortage of behavioral health specialists across
this country. So, leveraging technology--and we have also found
that a lot of these patients are more comfortable reaching out
and seeking these services when they are able to do it from the
comfort of their own home.
Senator Whitehouse. I am really glad to hear you say that,
because that is the exact same thing I have heard from the
treatment and recovery community in Rhode Island. They did not
expect that, Mr. Chairman. They expected that when they got
access to telehealth, that would solve the COVID exposure
problem and there would perhaps be more utilization of
services, which in fact there was, which is a good thing in
that environment.
What they did not expect, but what they have told me over
and over again they experienced, is that the content of the
engagement actually improved, because the patient did not have
to drive across town, sit in the stupid waiting room, fill out
the stupid clipboard, go into an alien office, and then share
what was going on with themselves. They could do it from the
comfort and security of their own homes.
So, thank you for bringing that up. Well said.
The Chairman. Thank you, Senator Whitehouse. And Senator
Whitehouse, as usual, is talking about important health-care
reforms, and I just want to note--we touched on it a little bit
earlier.
When Senator Whitehouse talks about using the COVID model
for telemedicine--and Senator Warner knows this--the Senate
basically used our model, the Finance Committee's model from
the chronic care bill, and plugged it into what we did for
COVID.
So, we have a lot of history, and I look forward to hearing
more about what you are--you call it TREATS? Great; good name.
Okay. Senator Barrasso is next.
Senator Barrasso. Thank you, Mr. Chairman.
Dr. Mueller, in Wyoming our medical school works in
partnership with the University of Washington, along with
Montana, Alaska, Idaho--the WWAMI program. And what we find out
is that giving students and residents a rural experience helps
them recognize early in their career the benefits of working in
rural clinics and hospitals, hopefully then moving there and
practicing full-time. I really think it is a great recruitment
tool if they have that experience.
So, research shows residents are more than five times more
likely to then go on and practice in a rural community if their
residencies are in those type of communities. And I see, Ms.
Rodefeld, you agreeing completely. I am going to have a
question for you soon about OB/GYN in some of these areas.
You know, that is why I have introduced legislation called
the Rural Physician Workforce Production Act, to provide
additional funds to rural hospitals that train residents. Right
now, so much of the funding goes to the large city hospitals,
not the rural experience. So, how could a sustainable resident
payment model for training in rural areas--and this is
political, but it is bipartisan, because whether you are
Republican or Democrat, if you are from a State that has a lot
of rural areas, you want to get doctors into those areas. So
how could a program like this, this model for training in rural
areas, actually help training programs be more viable in those
locations?
Dr. Mueller. You hit on it. The answer is part of the
question, Senator Barrasso, in that getting that additional
funding would put a lot of the rural hospitals sort of over the
threshold of being able to implement the program. The next step
would be to find a way, through the GME funding streams, to
have funds flow directly to those hospitals for those programs,
rather than having them flow through a teaching hospital, which
then allocates out to the rural hospital. So, the direct
expenditure from GME would be very helpful.
Senator Barrasso. Great.
And, Ms. Rodefeld, could I go next to you? In Wyoming, due
to financial strains and workforce shortages, maternity
services are closing. You are an expert in this area. Five of
our counties have lost maternity services entirely, 7 others
have minimal access to care, and this leaves only 11 of our 23
counties with adequate access to OB services.
Now just for reference, every single county in Wyoming is
larger than the entire State of Delaware, the entire State of
Rhode Island. Some of our counties are larger than Connecticut,
larger than the State of New Jersey. So, can you imagine if the
entire State of Delaware, or Rhode Island and New Jersey, lost
all of their OB services? You know, it would be on the front
page of every paper.
So what I would like to talk to you about, as the expert
you are, is, how we can address this crisis? It is a matter of
health and economic viability for rural America. If you cannot
provide opportunities to deliver babies, it is harder to
recruit teachers, people in small businesses, all of those
things.
You really were successful, I thought, in Wisconsin in
crafting that residency program to be a tool to addressing
rural access. So, on the Federal level, can we mirror the
access and the success that you have had?
Ms. Rodefeld. Yes. I think maternity care is a huge issue.
It is an issue in Wisconsin. I think we have 13 OB units that
have closed within the past 11 years. So, we are right up there
with you in your State. But I would say that we need to get
family medicine residents OB experience and encourage and
nurture their interest in performing OB. I will say in smaller
hospitals, in smaller settings, it is hard to be a physician of
one, providing service to a community. I know how difficult it
can be if you want to take a vacation. Who is going to cover?
Who is going to deliver your babies for you?
Similarly, there is a dearth of OB/GYN rural residency
programs. We have one in Wisconsin. I believe that there are
three others across the country. But I think that hope is on
the way. I have talked with many hospitals that are looking at
creating rural tracks. Section 127 of the Consolidated
Appropriations Act does allow for complement increases.
I think it is educating OB programs that this is possible,
that you can do a complement increase, have one extra resident
and give them 50 percent of training time in a rural area,
which we know leads to future rural practice. But again, it is
not a one-size-fits-all approach.
We have also launched two OB fellowships in Wisconsin, but
that has been a long time in the works, and it is not going to
get us exactly where we need. But we need to support those
physicians who have an interest in OB and provide some
mentorship, because I think one barrier I have seen with new
grads from any OB program is that, if they are the only
provider in a hospital, that is very scary if you are not as
experienced.
Senator Barrasso. Final question, for Mr. Davis. Good to
see you again; welcome to Washington. You went to County, where
you were in Evanston. I was there for the health fair many
times in Evanston as well. You went to the county health fair
in Bridger Valley just 2 weeks ago. So, I am there in the
community a lot.
As you know, rural hospitals and clinics across the country
are closing at a higher rate than urban hospitals. Patients are
forced to travel greater distances. You know, I think that
telehealth has helped, but how else can we strengthen rural
care so patients are not forced to drive hours for care?
Mr. Davis. Yes. So you hit the nail on the head. Obviously,
expanding telehealth and making some of the flexibilities we
have, making those permanent, would be a huge help. Again, I
think recruitment incentives would be very helpful.
Many of these providers have significant student loan
debt--and I heard HPSA scores were brought up, having that
reevaluated. And then, just adequate reimbursement. We have
seen significant increases in wages and compensation to keep
up, to attract, and it is a challenge. So reimbursement would
be a big help.
Senator Barrasso. Thank you, Mr. Chairman.
The Chairman. Thank you, Senator Barrasso, and you hit the
key question, which is, how we can find new ways to create
incentives to strengthen these rural communities? We will want
to talk with you.
Okay. Senator Bennet is next.
Senator Bennet. Thank you, Mr. Chairman. Thank you all for
being here today.
When you get toward the end of the dais, some of your
questions have been asked already. But I hope that this one has
not. In Colorado and across the country, we are seeing entire
swaths of rural counties that have no obstetrics care of any
kind, no mental health care of any kind. People coming out of
COVID have used telehealth, I think, in ways that have been
useful. But it does not replace having people in your community
doing this.
Increasingly, Ms. Rodefeld, a barrier in Colorado seems to
be housing, places where people just cannot afford to live in
rural parts of the State. Providers are becoming housing
deliverers, because otherwise there is no housing for them in
places like the San Luis Valley in Colorado, which used to be
competitive.
Alamosa, CO--it was an advantage that real estate was
inexpensive there. Today, they are having a hard time hiring
doctors, to say nothing of something like the Roaring Fork
Valley between Aspen and Glenwood Springs, where people
commonly say to me that no doctor can afford to live there.
So if you could say a word about that, I would really
appreciate it.
Ms. Rodefeld. Yes. We are absolutely seeing the issues with
housing, and that does not just impact physicians and nurses.
It also impacts the ability of rural residencies to train and
recruit their graduates.
I will say, the rural hospital that I worked in prior to
coming into my position did own several houses and did explore
ways that they could build their own housing for their
workforce. I think any innovation where you can provide some
type of affordable housing, especially for those lower-wage
positions like medical assistants and the folks who work in the
cafeteria--they need affordable housing as well. And I am
impressed when I work with rural hospitals launching residency
programs. So, they have been very successful in fundraising. In
fact, one of the grantees that I work with has actually been
able to secure private funding to be able to purchase houses
for the new residents coming to their hospital, and that is a
huge relief for those incoming residents when they can know
they have a place to live and they do not have to search for a
home.
And I think, looking at other creative strategies--I don't
know if Dr. Mueller is familiar with anything with USDA, but
any infrastructure development that rural hospitals could use
to further build housing for their workforce could be helpful.
Senator Bennet. I have a couple of minutes. So, Dr.
Mueller, would you like to use some of that? And I think, Mr.
Davis, you may have some experience building housing for
teachers. So, it would be good for us to hear that too.
Dr. Mueller. I think that was a great summary. I would just
add two things to that.
One is, there has been some creative use of Medicaid
waivers around the country to be able to use some of the
Federal match in Medicaid to address housing issues,
predominantly because when patients are discharged from
hospitals, if they are discharged into a homeless status, then
they are right back in the hospital later. So, using some of
our payment through the health payment system to address that
is useful.
The other comment is, whatever the investment sources might
be--and USDA is one, through their programs; Housing and Urban
Development is one--State governments and philanthropy are all
stepping up to the plate in isolated examples that I am aware
of around the country. We can learn from those, try to expand
that to more communities.
Mr. Davis. You know, when I got into health care
administration, I never thought I would be managing houses, and
I think we have 10 or more leases. And one of the things that I
think is a really neat public-private partnership with the
local school district is--they noted there was a shortage of
tradespeople who do this type of work, so they developed a CTE
program. We had a need for workforce housing, so we agreed to
buy those initial sets of townhomes so they have the
reassurance that those are going to be sold, and they could use
that funding to then perpetuate that program.
So we view it as a community benefit, as we get an
intrinsic value out of it for our workforce, but it also is
investing in these young kids and hopefully creating a pipeline
that helps housing construction accelerate in the community in
the future.
Senator Bennet. Thank you. Thank you, Mr. Chairman.
The Chairman. I thank my colleague. Next is Senator Carper.
We also have a vote on, and I think that we can get to all of
the people here today before we see the vote close. We will
have to see who else arrives. But that is going to be the goal.
Senator Carper?
Senator Carper. Thanks, Mr. Chairman.
Welcome. I think I had the chance to shake your hands and
welcome you here earlier this morning. So we are glad you are
sticking around and that we have a chance to ask you some
questions.
In 2020, in response to the COVID-19 pandemic, CMS
implemented what they called the Acute Hospital Care at Home
waiver program. You may be familiar with that. The program
permits Medicare beneficiaries to receive hospital-level
services in the comfort of their own home, which is really what
people prefer to do, as you probably know. For now, patients
and providers continue to access the Hospital at Home program.
Last Congress, Senator Tim Scott and I championed legislation
that extended the Hospital at Home program waiver for 2 years
beyond the duration of the COVID-19 public health emergency.
Since then, this health care delivery system has not only
benefited patients by making hospital-level care more
accessible, it has also been shown to do a number of things
that we all should seek, and one of those is reduce cost.
Another is to improve patient outcomes, and a third is to
provide high patient satisfaction. That is like a hat trick.
Today, hospitals and health-care systems across, I think 36
or 37 States, including my own home State of Delaware, utilize
the Hospital at Home program to provide safe, high-quality
hospital-level services in patient's homes. Currently, the
Hospital at Home program is set to expire in this country at
the end of this year.
I just believe, and Senator Scott believes, that we cannot
allow this to happen. To ensure that Medicare beneficiaries and
their health-care providers have the certainty and stability
that they need for this important care delivery option, this
week Senator Tim Scott and I introduced the Hospital Inpatient
Service Modernization Act of 2024. The bipartisan legislation
would further extend the Hospital at Home waiver program for
another 5 years. As rural communities face an abundance of
access and quality-of-care issues, alternative care delivery
models like Hospital at Home hold the potential to improve
health-care delivery in rural communities.
Question for Mr. Topchik. I always liked Mr. Topchik; love
that name. And could you please share with us how the Hospital
at Home program has been beneficial to patients in rural areas,
please?
Mr. Topchik. Senator, thanks for that and all your work on
the issue of Hospital at Home. I think it is an innovative
model, and it is proving out across the country. This movement
to provide a relief valve in the provision of high-quality care
at lower costs, and keeping patients at home is so, I think,
valuable to the patients. And in rural areas that is such a
challenge, keeping patients home instead of traveling great
distances.
I think the tension here in rural areas is workforce, and
it is the volume and the scale. But I know there are
experiments going on right now with rural Hospital at Home
programs, and I really look forward to seeing how they play
out.
Senator Carper. I am going to ask you another question for
the record, and that is: how do we as policymakers address
these barriers, including workforce? I think it is important. I
will ask you to respond for the record.
Mr. Topchik. I am sorry, how do we directly----
Senator Carper. No, no. We will ask you to respond for the
record in writing, okay?
Mr. Topchik. Okay; thank you.
Senator Carper. Okay. We will follow up. Yes, there you go.
When I visit health-care facilities up and down Delaware, I
ask three questions, and I do it every day. We go home--we will
finish up here later today--I will go home tomorrow, be all
over the State. I visit businesses large and small, and I ask
them three questions: how are you doing, how are we doing--our
congressional delegation, the Congress, and so forth--and what
can we do to help?
The biggest challenge I hear about consistently now for,
not just weeks, months, but for years, has been workforce--you
know, having people show up for work who are either trained or
trainable, and who are willing and ready to do a day's work.
But the challenge is amplified in the more rural counties.
We have two rural counties, and we have three counties in
Delaware. The southern-most county is a very rural county. We
have that challenge throughout the health-care industry. Two of
Delaware's three counties are considered Health Professional
Shortage Areas. We simply do not have enough health-care
providers choosing to practice in these rural communities. It
is critical that our rural communities are able to recruit and
retain a qualified workforce to ensure patients have access to
high-quality care.
I have one last question, and, Mr. Davis, this would be for
you, please. What are you learning from the health-care
facilities that are doing well at recruiting and retaining
staff? What did you learn from those? I always say, ``Find out
what works; do more of that.''
Mr. Davis. I think, in terms of workforce training, doing
good onboarding training programs. We do a lot of leadership
development. Our strategic plan that we just adopted--we are
going to be investing a lot in our middle management to kind of
grow our own.
At one point, we had 220 open positions during the
pandemic. So we were kind of up against the ropes, and thank
goodness for our workforce and our staff. We have clawed back,
and now we are back to about 60 open positions, which is kind
of pre-pandemic. It is just continuing to create a culture and
an organization that people want to be a part of.
The Chairman. As much as I agree with Senator Carper, we
are going to have to move on to get everybody in.
Senator Warner?
Senator Carper. Thanks to you all.
Senator Warner. Thank you, Mr. Chairman. I want to echo
what Senator Bennet said. Sometimes when you are at the end of
the dais, your questions have been asked.
I do want to mention the fact that I thought Senator
Whitehouse was doing such a good job on telehealth, in raising
the important issue of what telehealth actually did with opioid
abuse, and the notion that we can use this tool in a dramatic
way, and for things like Suboxone, and there were no abuses. I
said, ``Boy, how is he so smart?'' My staff said, ``Well
actually, you and he are working together as coleads on that
bill.'' So, I was glad to be informed that we were jointly
smart.
In that same context there, Senator Barrasso's comments
about the lack of OB/GYNs--I mean, in my State, in the
Commonwealth of Virginia, we have the area between Richmond and
the North Carolina border, it is called Southside. We have had
five OB/GYN practices leave hospitals, and we have a wide
swath--maybe not as big as New Jersey--but a wide swath of our
State where people literally have to travel hours and hours.
That is why, Mr. Chairman, I am glad that you and I and others
are going to introduce the labor and delivery support, to try
to increase the Medicaid reimbursement issue.
I think one question that maybe has not been asked--and
this is for Dr. Mueller--is the question around pharmacy
services. Again, one of the things that we saw during COVID was
better utilization by pharmacies of things like COVID tests,
tests for flu, for strep. And in Virginia, we had been pretty
good about trying to look at the evolving nature of
pharmaceutical services, and the fact that pharmacists are now
providing a lot of services that people used to have to go to
either an actual provider or an urgent care center for.
The thing is, we have worked on employer plans. We have
worked on Medicaid, but those Virginians on Medicare cannot get
the reimbursement through their pharmacy. Dr. Mueller, do you
want to make a comment on that?
Dr. Mueller. I think you are correct that that set of
services is critical and available in a lot of rural
communities only through the pharmacy, as you point out. And we
did some early work during the pandemic to call attention to
that, when it came to distribution of vaccines. The only way to
get that out across all of rural America was to get it out
through the local independent pharmacies.
So, everything that we do in reimbursement policy,
including Medicare, the gap that you mentioned, is something
that we need to pay attention to, to keep that vital service
there and to point out finally that the pharmacy service is
part of the health team, and to think of it that way rather
than only, well, that it is just dispensing drugs. No; there is
a lot more to the local pharmacy services.
Senator Warner. Yes, I think there is. Again, a lesson
learned from COVID that we ought to continue. And if we have
employers, if States are using the Medicaid plans, I hope we
can work on that reimbursement on Medicare.
I want to raise--we are in a hurry, so I will stick with
you, Dr. Mueller, on this. Something that I think has been
indirectly talked about a lot is how we make sure we keep rural
hospitals alive and vibrant. I was proud that we--in Virginia
we were actually, after 6 years, able to reopen one of our most
rural hospitals in far southwest Virginia, Lee Hospital.
But working with my colleague Senator Blackburn, we have
introduced, for a number of years, what we call the Save
America's Rural Hospitals Act, which would try to go ahead and
look at the average wage index and bump it up to a base minimum
across rural communities.
I think what we have seen, particularly from MedPAC, is
that we have carved out some of the exemptions in that formula,
and I would just really question whether it is working. From
the rural hospital standpoint--and before Senator Blackburn, I
worked with Senator Lamar Alexander on this. Our rural
hospitals have to have that minimum floor, or they are not
going to be able to compete.
But maybe we should just go ahead and look at this whole
tool, which frankly, in many ways I think has been so chopped
up and carved out that it does not meet basic needs. I know the
whole panel would like to weigh in, but I am going to stick
with you, Dr. Mueller, to try to make sure that I adhere to the
chairman's 5-minute rule.
Dr. Mueller. Quick answer: yes, we should be looking at the
wage index issue with what you have in mind. Are we doing it
the right way? And then second, why are we doing it? Why are we
saying that there is such variability in that when we are
hearing about the cost of workforce recruitment and retention?
Senator Warner. And, Mr. Chairman, I am more than willing
to waive back my remaining 11 seconds so Senator Hassan, who
has been so patient, gets her--or whoever is next.
The Chairman. Collegial as always. Thank you, Senator
Warner.
Next is Senator Blackburn, but we are going to get
everybody here in, and we will see if anybody comes in and
tries to juggle it. But thanks for being so helpful.
Senator Blackburn?
Senator Blackburn. Yes: thank you so much. And I am going
to pick up right where Senator Warner left off, because several
years ago, I developed what is the rural health agenda. It was
important for my State of Tennessee--and Senator Durbin and I
have worked together on workforce, and have legislation that
would beef up that workforce.
As you mentioned earlier, Ms. Rodefeld, getting people to
work in a rural area--so, if you do this for a period of 5
years, then your student loans would be forgiven tax-free. And
so, Senator Durbin and I are working on that. Senator
Hickenlooper and I are working on innovative delivery models,
so that you carry that access into the rural areas. And Senator
Warner--he and I have worked on this area wage index. You know,
having these differentiations made sense in 1968. They do not
make sense today. Health-care delivery is technology.
I am reminded of this as I go through my community every
day, with health-care innovators that are there in Nashville. I
do want to talk--let's see. Mr. Davis, let me talk with you
about telehealth, because this is something--when I was in the
House, we worked on telehealth.
We have seen tremendous promise with this. I think we have
90 percent of the health-care centers now offering this, and of
course we decoupled it from the emergency health order.
Permanency is going to be important. Stopping this thing of
having to go back and reauthorize is going to be important too.
But the disparity in the reimbursements--our rural centers
are getting $95 for a telehealth visit. Urban and in-person
visits are $195. Now, we know this is expanding. I recently
went through the technology, that is, the doctor is a hologram.
It is in the box, it is in the room with the patient. So that
is the next evolution of this.
So talk to me about the difference in reimbursement rates
from the telehealth to the in-person, the way you get better
compliance with adding in the telehealth, and the difference
that makes for people in rural areas?
Mr. Davis. Sure. That is a great question, and I think you
kind of bring up a great point. I think we are at an inflection
point in this country where we had been advancing telehealth,
and then the pandemic hit, and we really saw a lot of providers
and patients who actually learned to love it. Where they were
really reluctant to use it prior to that, now they do not want
to go back.
They see it as a great tool to improve access, and really
for some of those patients who are really hard to get in--they
have transportation issues, they have mobility challenges, they
are busy; maybe they are working professionals.
So to be able to leverage technology is huge, but there is
a misaligned incentive whereby these Rural Health Clinics and
FQHCs, we do not get the equal payment. And so, it is to our
advantage for those who run these clinics to prioritize and
prefer and almost push these patients to come in for a visit.
And so absolutely, anything that we can do to increase that
payment parity. You know for us, we have a couple of Rural
Health Clinics, and we have to carve out any space in the
building that is being used for telemedicine. We cannot recoup
those costs. And to me it should not matter whether we are
rendering that service via camera or by microphone, or whether
in person. We are taking care of rural Americans, and therefore
the payment should be on par.
Senator Blackburn. Well, I agree with that. And the area
wage index--I want to add just one more thing on this and the
work that Senator Warner and I are doing, trying to establish
that floor and get it at an 85-percent floor, because
technology is where it is now, and we have to make certain that
you preserve that access to care in these rural areas. Unless
we address this wage index, we are not going to be able to
guarantee that.
I will yield back my 19 seconds, Mr. Chairman.
The Chairman. More collegiality. Thank you, Senator
Blackburn.
Senator Hassan, you are next.
Senator Hassan. Well, thank you very much, Mr. Chair, and
to you and the ranking member for this hearing. To the
witnesses, thank you for being here, but also for the work you
do. And I want to add on to the line of questions about
maternity and obstetric care.
I recently toured the birthing unit at Speare Memorial
Hospital in Plymouth, NH. It is the only birthing unit left in
that area of the State. Eleven maternity wards have closed in
New Hampshire in the last 2 decades. The average time now to
get to a birthing unit in New Hampshire is about 40 minutes,
and when you add bad weather and mountains to that, it can be
pretty dicey.
So, the situation in rural New Hampshire is certainly not
unique, as we have heard from this dais this morning. Since
2011, around one in four, or more than 260 rural hospitals,
have shut down their obstetric services.
Mr. Davis, this is a question for you. We have talked about
how we can make sure there are obstetric services available,
but what I am concerned about specifically is, how do we make
sure that all hospitals are ready to provide urgent obstetric
care such as labor and delivery, even if they do not have an
obstetrics unit but somebody appears at the emergency room?
Mr. Davis. Yes. Well, it is a great question because, when
you think about health care, you have pre-hospital, you have
acute, and then you have post-discharge and post-acute. And
given the maternal crisis we have in the country, we have to
think upstream. We have to make sure that EMS, certainly the
emergency room, can be a safety net.
But they are not doing deliveries every day, and so
adequate training, adequate equipment--I know in the case of
Grande Ronde Hospital, when we learned that the nearby hospital
in Baker City was closing their maternity program, I was really
proud of our emergency department and our OB providers. One of
our ER docs serves as the medical director, and so he went out
and did some refresher courses with EMS, and then the same with
our OB/GYNs.
And your case in point, I actually just learned recently,
in the last month and a half, that there was a mother in Baker
County who--of course, I think it was late at night, you know,
all times of day--did not make it to the hospital, and ended up
delivering in her car in a canyon.
Senator Hassan. Right; yes.
Mr. Davis. And luckily it was this time of year instead of
December or November or January. And so that pre-hospital
preparation for EMS is going to be absolutely critical.
Senator Hassan. Absolutely. And I just want to make the
chair and my colleagues aware that Senator Britt and I have the
Rural Obstetrics Readiness Act, with Senator Collins and
Senator Smith, that will help rural health-care facilities
train their staff, purchase equipment. And then one of the
other things we are looking at is a nationwide telehealth
service, so that if you are dealing with an obstetric emergency
in an emergency room, you can hook in 24-7 to an obstetric
expert who can guide you through that particular emergency.
Mr. Topchik, as we have heard today, Medicaid covers nearly
half of our rural births across the country. It covers prenatal
visits and labor and delivery, but providers often cannot get
reimbursement for the time they need to spend coordinating
care, such as developing a care plan for a pregnant woman or
coordinating with community resources to get her the support
that she needs. How can we help doctors and hospitals provide
the consistent coordinated services that women need to stay
healthy during and following pregnancy?
Mr. Topchik. Right. You know, from prenatal care through
birth and post-natal care, we need to support mothers and their
children, and the biggest payer of that in this country is
Medicaid. This body has done a great deal of work with seniors
through the Medicare program. Medicaid of course being a
Federal-State partnership, it is a little bit more challenging,
but I think similar types of investments are going to be needed
to be made in order to sustain what is an eroding aspect of the
American health safety net, which is maternal care.
Senator Hassan. Well, I appreciate that. And, Mr. Chair, I
know that this is an area of great interest for you. Senator
Grassley and I have the Healthy Moms and Babies Act--and I know
Senator Grassley has mentioned it--which would create an option
for States to reimburse for highly coordinated maternal health
care. So I hope it is something we can consider as we are
moving forward on this topic.
The Chairman. We will. We will definitely be interested in
working with you.
Senator Hassan. Okay. And I will not ask this question,
because I think it will elicit a long answer, except I will ask
it for the record later on. But I am working on, obviously,
site neutrality as an issue in our health-care system. As we
work on that, we also have to make sure rural hospitals are
appropriately reimbursed.
And so, I will look forward to submitting that question for
the record as well. Thank you.
The Chairman. Great; very good.
Senator Cortez Masto is next.
Senator Cortez Masto. Thank you, Mr. Chairman. Thank you
also to the panel for being here.
I have been focused on, in my State of Nevada, expanding
opportunities for health-care providers to train there, because
we know once they train, they usually remain, and that is a
key, I think, for many of us. And that is why I have been part
of a bipartisan working group with my colleagues here on the
committee to advance additional Medicare graduate medical
education proposals, and you all are very familiar with that.
Congress recently approved Medicare-supported residency
positions and specified that these slots should go to hospitals
serving Health Professional Shortage Areas, HPSA. I support
this policy because in Nevada, all 17 of our counties--all 17
of our counties--are designated shortage areas. However,
listening to the testimony today, you have highlighted that
some rural hospitals in Wisconsin have not applied for slots
because they do not have that designation.
My aim is to make sure that these new slots are allocated
to the areas where there is the greatest need. So I guess, Ms.
Rodefeld, my question to you is, you talked a little bit about
why rural areas in Wisconsin lack HPSA designation, despite
experiencing this health-care workforce shortage. Do you
believe we need to clarify current law regarding the GME
allocation formula to better identify and support our rural
communities with those critical health-care needs?
Ms. Rodefeld. Yes, that is a great question. And I think as
you look at, again, the relatively small pool of rural
hospitals that host GME, and then those that are located in a
HPSA area, it is going to be even smaller.
I would say in Wisconsin, we actually have four hospitals
that are looking to expand their rural programs that are
training not only for their local community, but what I have
seen time and time again is, when they are full, they feed the
nearby counties that are HPSAs. So again, while you may not
have a residency program located in a HPSA, they may be
attracting those residents, because all the data shows
residents typically stay within 100 miles of where they do
their training.
And if they cannot stay in that HPSA, they will go to the
neighboring county. I have seen--right now we are at about 70-
percent retention of residents in-state. And again, we have
done a lot of really great work to partner together to meet our
workforce needs in the State. But I think, looking at
prioritizing HPSAs in site distribution--absolutely, hospitals
with HPSA should get slots first.
But if there are remaining slots, we could look at those
residency programs in rural hospitals that are doing great work
and allow them to expand as well.
Senator Cortez Masto. Okay. Thank you. That is helpful.
And, Dr. Mueller, sole community hospitals--Nevada has two
of them--sole community hospitals and Medicare-Dependent
Hospitals are well-positioned to host the residency programs.
However, those compensated based on their hospital-specific
rate face financial constraints due to a lack of independent
medical education adjustment, leading to inadequate financial
support for training programs for Medicare.
In contrast, sole community and Medicare-Dependent
Hospitals paid under the Federal rate receive both direct
medical education and indirect medical education payments when
starting teaching programs. So, Dr. Mueller, my question to you
is, do you believe that sole community and Medicare-Dependent
Hospitals, which actually represent 80 percent of eligible
rural training hospitals, should receive fair incentives for
teaching programs?
Dr. Mueller. Yes. That is a fairly easy answer.
Senator Cortez Masto. And can I ask, would addressing this
Medicare payment gap contribute to securing the workforce
needed to sustain these rural service areas?
Dr. Mueller. It would certainly be very helpful. You know,
we are always hesitant to say a single lever is going to change
a lot of behavior. But it seems like it would be a necessary
and, in many cases, sufficient condition, yes, to get them to
change.
Senator Cortez Masto. Good. Thank you, because I agree with
you 100 percent.
And then finally, let me just say to the panelists,
telehealth is a game changer. We all know that, particularly in
our rural communities and our frontier communities across this
country, including in Nevada.
I am curious though. Which specific Medicare telehealth
flexibilities do you believe are most essential for addressing
the health-care needs of rural communities? We talked a little
bit about payment parity. Are there other things that we should
bring to the attention of this committee, to make sure that we
are prioritizing or making permanent, when it comes to
telehealth services?
Mr. Davis. I can take that one. So, a couple that I wrote
down just in case. There should be no geographic restriction
from originating site for nonbehavioral health, mental health,
or telehealth services. Some nonbehavioral health can be
delivered using audio-only communication platforms.
And then the big one is, an in-person visit within 6 months
of the initial behavioral health/mental telehealth visit, and
annually thereafter, is not required. So there are just some
little, I think, tweaks that can be done that would make this
much more efficient.
Senator Cortez Masto. Thank you, and I know my time is up.
Audio-only--is that something you would support?
Mr. Davis. Well, given that many of the rural communities
cannot meet the broadband requirements at this point, then,
yes--and we want to get to video.
Senator Cortez Masto. Yes; thank you. That is the answer I
wanted. Thank you so much.
Thank you, Mr. Chair.
The Chairman. The Senator from Nevada and I both know when
to quit while we are ahead. And well said; thank you.
The chair of the the Health Care Subcommittee, an expert on
these issues, is here: Senator Cardin.
Senator Cardin. Thank you, Mr. Chairman, and thank you for
holding the full committee hearing in regards to rural health
care. The subcommittee has been actively engaged in this issue,
and this hearing very much helps us in filling in some of the
additional information for us to adjust policies to deal with
the gaps we have in rural America.
I represent the State of Maryland. Most people think the
State of Maryland is a pretty urban State. We have rural
communities that have challenges with access to health care. In
the western part of our State, the eastern part of our State,
it can be a challenge to be able to get access to health care.
I know there has been a good deal of discussion on two
areas that have been extremely important in our State.
Telehealth has been a real game changer. I've been to Pocomoke
City on the Eastern Shore of Maryland, seeing the direct
benefits of telehealth in being able to get health-care needs
met. And we invested a long time ago in broadband, so that most
of our communities now have access to high-speed Internet. So
we have been able to put in the infrastructure for rural
Maryland that has helped us a great deal to deal with these
challenges.
But there are at least two areas where we find a real
challenge. One more thing about Maryland: Maryland has a Total
Cost of Care model, the only one in the country, where we have
an all-payer rate structure. So, we can use our rate structure
to provide equities to rural hospitals that would otherwise be
at a disadvantage because of the volume that is in these
facilities, compared to our urban centers.
But there are two areas that we find challenging that I
would like to get your comments on. They are both related, and
one is preventive health care, which many times requires a
person to travel in order to have the follow-up necessary for
the preventive health-care services, and that can be a
challenge in rural America. The second is oral health care.
Oral health care has been an area of particular concern to us
in Maryland. I mention this frequently.
When I came to the Senate in 2007, we had the tragic loss
of Deamonte Driver because he could not get access to health
care. All he needed was a simple extraction. It did not get
treated. His mother tried, could not get access. There were no
facilities available. In the rural parts of our State, the
rural parts of our country, it is not as easy to get access to
oral health care. At times, we do not think that is quite as
important, and it is critically important for rural health
care.
So, can you tell us what strategies have worked in rural
America, what we can do better to be able to put a priority on
access to oral health care, particularly for our children--
which is now a covered service under all of our health-care
plans--but also for the adult population, as well as how we can
better serve in dealing with the extraordinary technologies
that have developed in detecting diseases early, which are not
always available as easily to people who live in rural America?
Who wants to take a stab at that? Everybody is
volunteering. I appreciate that very much. I will call on you
then. Dr. Mueller, you are up first.
Dr. Mueller. Okay.
Senator Cardin. You give short answers. That's why I'd like
to call you first. [Laughter.]
Dr. Mueller. The true answer is, I think a comprehensive
health team--which I mentioned in my oral testimony--has to
include preventive health services and oral health care. Once
we establish that as part of the health team, I think we will
start dedicating more resources to figuring out how we get that
everywhere, where we are saying that we are serving
populations.
And the answer for that in rural is some combination of
telehealth, where we can use it, but different levels of
professional services with preventive care. What can we
utilize? We talked about pharmacy earlier. How can pharmacies
play a role in that?
In oral health care, how can we utilize dental hygienists
as effectively as possible, and how do we utilize oral health
clinics that can be mobile and serve multiple communities,
rather than thinking we have to have one in each community?
Senator Cardin. Ms. Rodefeld, I see you are in the GME
issue. One of our areas that we have been able to expand is the
qualified health centers to include oral health care, and have
them located in rural communities, not just in the urban
centers.
A lot of that deals with having the personnel. So how do
you incentivize getting the medical personnel in rural
communities through the graduate medical programs?
Ms. Rodefeld. Yes. I think that there are a couple of
initiatives. One is, the family medicine residency programs
have a Smiles for Life curriculum, and trying to get them to
approve that and implement that is a big approach, because
primary care can make referrals to dental.
I have been involved with efforts with teaching health
centers, and we have a number of teaching health center
planning and development grantees that are dental. But even if
they are located in an urban area, a lot of them have mobile
units. And actually I was, just a few weeks ago, at a NAC
conference where they were talking about ways that they could
get their dental residents out into rural communities with
mobile units--so, very similar to what Dr. Mueller just shared.
But I think supporting any incentives to get dental residents
or even dental students into rural communities is a great
strategy to help address some of these issues we are seeing.
Senator Cardin. Thank you.
Thank you, Mr. Chairman.
The Chairman. Thank you. I would just say, to our friends
and people following this, Senator Cardin has been the go-to
person in the Senate--using his chairmanship on this
Subcommittee on Health Care--for oral health care. I so
appreciate it, and we are going to have to find a way to fill
his big shoes, and it will not be easy.
Senator Warren?
Senator Warren. Thank you, Mr. Chairman.
Rural health-care providers face a slew of challenges--low
patient volumes, high operating costs, staffing shortages--and
this threatens health-care access and quality of care for
millions of people in rural communities. In April, CMS took a
big step to improve quality of care in nursing homes by putting
in place minimum staffing standards, including ensuring that
facilities have a registered nurse on duty 24-7.
Mr. Topchik, you are an expert on rural health care needs.
So can you tell us, what will this new staffing rule mean for
quality of care, particularly at nursing homes in rural
communities?
Mr. Topchik. Senator, I appreciate the question. I was just
evaluating nursing homes a couple of months ago for my father,
and was shocked to learn that there was not a nurse on staff 24
hours a day. So, the idea of elevating staffing requirements to
better serve our seniors, to provide higher-quality care,
thrills me.
I do note the tension that the committee noted in the final
rule by referencing the challenges rural faces and by offering
a 5-year ramp-in to meet those challenges, as well as a variety
of opportunities for waivers, if they happen to be in a Health
Professional Shortage Area. So, I appreciate that.
Senator Warren. Good; thank you. You know, I think this is
a good rule that is going to help millions of nursing home
residents, and it is made even stronger by the fact that CMS
listened and they addressed the concerns of rural nursing home
providers. I think that is an important part of it.
Fortunately, CMS also had the good sense to ignore the
biggest nursing home companies' claims that they cannot afford
to increase staff. Last week, I wrote to three of the biggest
publicly traded nursing homes about a new analysis that my
office did, that found that these homes had paid out over $600
million in stock buybacks, dividends, and CEO pay since 2018,
which sounds to me like they actually have the resources to
implement this rule.
Mr. Chairman, I would like to make those letters part of
the hearing record.
The Chairman. I am looking forward to reading them; so
ordered.
[The letters appear in the appendix beginning on p. 97.]
Senator Warren. Okay; good.
So now I want to talk about another health-care challenge
facing rural communities. In just the past decade, over 160
rural hospitals have closed, while over half of all rural
hospitals are currently operating in the red. Rural hospital
operators have identified the same program as the biggest
hospitals have. Their threat to survival is Medicare Advantage,
or MA, which allows private health insurance companies to
administer Medicare coverage for over 31 million Americans.
Mr. Topchik, do you agree that Medicare Advantage is the
biggest threat to rural hospitals?
Mr. Topchik. Senator, I work with hundreds of rural health
executives who tell me that it is keeping them up at night. It
is one of their single biggest concerns, and I asked them about
this. And what they tell me is, they cite a more challenging
environment with preauthorizations. They cite differing net
reimbursements, especially around the critical swing bed
program with Critical Access Hospitals. They cite higher rates
of denials and delays in reimbursements, and they tell me
they're falling behind.
Senator Warren. All right. So basically, they delay
payments, they deny payments, which boosts profits for Medicare
Advantage and leaves our rural hospitals in the red. Private
insurers in Medicare Advantage are routinely delaying and
denying payment to providers, and they make it increasingly
difficult for rural hospitals to get reimbursed.
For example, in 2022, an investigation by the Health and
Human Services Inspector General found that nearly one in five
payment denials by insurers in Medicare Advantage violated
Medicare coverage rules--one in five. And this is particularly
devastating for rural hospitals, which rely more on public
payers like Medicare.
So that is why I have called on CMS to aggressively
increase its audits of private insurers in Medicare Advantage,
and to terminate contracts with those wildly profitable
corporations when they are in violation of Medicare law. It is
past time that we protect taxpayer dollars and at the same time
ensure that rural hospitals can stay open for the millions of
seniors who rely on them. Thank you.
Thank you, Mr. Chairman.
The Chairman. I thank my colleague, and I just want to say,
as we have talked about before, I think that the Senator is
right, that we need additional audits as it relates to Medicare
Advantage. I am very supportive of it.
Okay. To our guests, thank you for giving us this kind of
on-the-ground assessment of what is going on in rural health in
America. Mr. Davis, I think you really gave us a chance to kick
this off. It was the Oregon way especially, but what you said,
and I wrote it down exactly, is in rural health, you know,
communities are looking for a hand up and not a handout, and
that is what we are kind of going to build on.
I think everybody heard us discuss the fact that the
committee feels strongly that we have been able to take some
steps to be helpful in rural areas. The telehealth model came
from the CHRONIC Care Act that was written in this room--in
this room.
The late Orrin Hatch led a big group of us. I remember--you
know, Medicare, when I was director of the Gray Panthers, was
largely about acute care. It was about, you broke your leg and
you went to the hospital, that was A; and you had health
problems and you went to the doc, and that was B.
Now it is chronic disease, and what we are using is the
importance of telemedicine to deal with a lot of those kind of
conditions. So, we are going to take what we have done in
telehealth so far and extend it, and particularly look to using
it across State lines with some of the flexibility we were
talking about.
I do think that we have got to zero in on this question I
started like 2\1/2\ hours ago with Mr. Topchik. We want to help
rural communities with their conditions on the ground, and we
talked about not very many babies, but you have to have
something 24-7 and the like.
I am prepared to help in those kinds of issues, as long as
the big guys do not take the money and run. We need all of you
to kind of help us get the nuts and bolts right. It is always
one thing to say it in a hearing; it is another thing to
actually write it in language so you get it right, and we are
going to want to do that.
And my colleagues all through the morning had suggestions
and ideas they are working on. You can see there is tremendous
passion for this cause here in the Finance Committee. And I did
not hear a lot of people say, well, there is only a Democratic
way and a Republican way, and go back and forth. They were
talking about sensible ideas.
And for me, this comes back to the proposition--and Mr.
Davis knows this. We have 36 counties in Oregon, and a lot of
them are such a far distance from Washington, DC, they think
that for all practical purposes in their lives, DC might as
well be Mars for all the connection it has to them.
What you do is, you bring us the kind of view on the
ground, all four of you. This is what we are dealing with, and
these wonderful people sitting in back of me try to take those
ideas and turn them into good and sensible policy.
We talked about maternity deserts. I mean, I think that is
really what we are looking at. I just want you to know on my
watch, as long as I am chair of this committee and have the
tremendous honor of representing Oregon in the U.S. Senate, we
are going to fight that kind of concept. We are not going to
let rural health care and these communities become sacrifice
zones. We can do better than that. And Oregon is mostly rural,
and you can hear from my colleagues that many of their States
are largely rural.
So you gave us a great kick-off to the cause of taking some
significant reforms as it relates to strengthening rural health
care in America. We are going to follow up with all of you.
For the Senators who are following the wrap-up, questions
for the record are due 1 week from today, at 5 p.m.
Thanks to all of you. We are adjourned.
[Whereupon, at 12:13 p.m., the hearing was concluded.]
A P P E N D I X
Additional Material Submitted for the Record
----------
Prepared Statement of Hon. Mike Crapo,
a U.S. Senator From Idaho
For more than 46 million Americans, including more than one in
every four Idahoans, rural communities offer a vibrant, culturally rich
way of life, bolstered by strong social bonds and a shared appreciation
for the natural surroundings that make this country so exceptional.
Federal health programs, including Medicare and Medicaid, have an
obligation to serve the unique needs of rural communities. This means
addressing the challenges facing rural hospitals and providers as they
deliver high-quality medical care to families in environments with more
limited resources.
The perspectives presented today will help us not only to identify
hurdles and barriers, but also to build on meaningful, sustainable
solutions aimed at ensuring remote communities can access care as close
to home as possible.
This hearing comes at a critical time, as a number of provisions--
from telehealth flexibilities to continued financial support for rural
hospitals and ambulance providers--expire at the end of this year. The
Finance Committee has come together numerous times in recent years to
extend these and other must-pass policies, which ensure seniors and
working families from all walks of life can continue to access the care
they need.
In 2022, nearly one-third of Medicare beneficiaries relied on
telehealth services. For rural areas in particular, where clinician
shortages continue to rise, cutting off this lifeline is not an option.
But, while telehealth can bridge access gaps, particularly for
specialty and mental health services, we must also maintain and expand
in-person options in rural communities.
Creative workforce growth and retention strategies have the
potential to bolster the number and types of providers in rural areas.
Evidence shows that doctors, nurses, and other health professionals who
train in rural areas are more likely to remain in these regions to
practice. It is critical that the programs within our committee's
jurisdiction ensure that there are ample training opportunities for
these health professionals.
Remote front-line providers often face substantial financial strain
once in practice, frequently driven by factors entirely outside their
control. In addition to serving patients, rural hospitals are often
critical to local economies, employing hundreds of individuals and
supporting regional business development. Unfortunately, since 2005,
more than 105 rural hospitals have closed, with numerous others forced
to fend off constant closure risks.
Medicare's existing strategies to preserve access to health care in
rural areas often rely on special reimbursement programs that
supplement payment rates to account for the unique geographic and
patient needs in rural America. We must prioritize the continuation of
these essential designations later this year.
However, even with a wide range of targeted payment adjustments,
some rural hospitals still struggle to achieve financial stability. For
example, small rural hospitals continue to be more heavily dependent on
inpatient volume as part of their total revenues. At the same time, the
health-care system is experiencing a steady, nationwide shift away from
inpatient care to outpatient services. Although this transition often
improves patient outcomes and lowers costs, it can leave hospitals
ineligible for certain Federal Government programs and without a
reliable revenue stream.
For some communities, Medicare's current payment structures may
actually stifle innovations that could pave the way for more
sustainable rural health-care delivery systems. Resolving these issues
is no easy task. Rural communities need the Federal Government to
support data-driven State and local modernizations that have the
promise to achieve results--increasing access to medical care, lowering
costs, and improving patient outcomes.
Alternative payment models, if well-designed, offer one potential
avenue for mitigating rural providers' financial challenges, but
bureaucratic barriers and insufficient payment arrangements can
complicate efforts to leverage these models to their fullest potential.
As our committee continues exploring clinician payment policy reforms,
bridging these gaps will remain a priority.
Fortunately, across the country, leaders and innovators from all
sectors and backgrounds continue to spearhead partnerships, strategies,
and initiatives aimed at driving improved outcomes in rural
communities, often building from the ground up. Federal programs should
facilitate these efforts and learn from providers and patients on the
ground.
Thank you to our witnesses for being here today. I look forward to
your testimony. Thank you, Mr. Chairman.
______
Prepared Statement of Jeremy P. Davis, MHA,
President and CEO, Grande Ronde Hospital
Chairman Wyden, Ranking Member Crapo, and members of the committee,
thank you for the opportunity to speak with you today.
My name is Jeremy Davis, and I am the president and CEO of Grande
Ronde Hospital, a 25-bed, not-for-profit, independent Critical Access
Hospital in La Grande, OR. Located in rural eastern Oregon, the
hospital was founded in 1907. Grande Ronde Hospital--which also owns
and operates 19 outpatient clinics--serves the local population of
26,000 residents and other parts of frontier eastern Oregon and
southeast Washington. My community is located 260 miles east of
Portland, OR and 170 miles northwest of Boise, ID along an interstate
that frequently closes due to weather or accidents. Because the nearest
hospitals are an hour's drive away--and are also Critical Access
Hospitals--we play a vital role in our community and region, ensuring
local access to quality health care. On a personal note, I grew up 45
miles from this community, so rural life and now rural health care are
core to who I am.
Covering 2,000 square miles (an area about the size of Delaware),
Union County is a mountainous area with a local economy that is based
on natural resources including farming, ranching, and timber. As of the
2022 American Community Survey's 5-year estimates, our median household
income is approximately $62,000, which is $13,000 less than the median
for the rest of the State. About 15 percent of our population lives in
poverty.\1\
---------------------------------------------------------------------------
\1\ https://data.census.gov/profile/
Union_County,_Oregon?g=050XX00US41061.
A recent CDC study highlighted the health-care disparities in rural
America, finding that people in rural areas are more likely to die from
five leading causes than people in urban communities. Hospitals like
ours stand in this gap, working to ensure that our rural residents have
access to high-quality health care.\2\ Union County has a high
prevalence of adults who are overweight or obese, have high cholesterol
and high blood pressure, or who chose not to have screening exams.
During our most recent community health needs assessment,\3\ we
identified chronic disease prevention, social determinants of health,
and behavioral health services as top priorities.
---------------------------------------------------------------------------
\2\ https://www.cdc.gov/ruralhealth/cause-of-death.html.
\3\ Grande Ronde Hospital, Inc., Community Needs Health Assessment
Implementation Strategy, Fiscal Years 2023-2025, https://
res.cloudinary.com/dpmykpsih/image/upload/grande-ronde-site-351/media/
1a56a0e071a745d0a7fcb97c2086298d/chna-written-implementation-strategy-
final-09-15-22.pdf.
Of the patients we see, over 60 percent are covered by government
payers, with 41 percent covered by Medicare, and 23 percent covered by
Medicaid. For rural hospitals, the substantial portion of patients
covered by Medicare and Medicaid underscores the importance of adequate
---------------------------------------------------------------------------
reimbursement from these programs.
But reimbursement is only part of our challenge. The aftershocks of
the COVID-19 pandemic shifted the ground beneath hospitals like mine
and those throughout Oregon, forcing us to make difficult decisions
about the services we provide to our communities. While many of the
challenges we face today were on the horizon, the pandemic exposed the
fragility of hospitals' financial foundations, particularly for rural
hospitals. In 2022, Oregon hospitals posted their worst financial
performance in 30 years. Rising expenses, workforce shortages, and
stalled revenue cratered hospital finances throughout the State,
putting hospitals in one of the worst overall financial positions seen
since 1993. As an example of our increased costs, Grande Ronde saw a
608-percent increase in cyber insurance premiums since 2019. Since
then, we have only seen incremental improvements in our finances due to
higher costs and needed investments. In 2023, Oregon hospitals
collectively posted a -1.3-percent operating margin. Without Federal
CARES Act funds propping up hospitals' margins in 2020 and 2021, last
year would have marked the fourth straight year hospitals experienced
significant financial losses.
Rural hospital administrators like me have an interconnected list
of worries that keep us up at night, including workforce safety and
shortages, financial stability, and more recently, worries about
cybersecurity. And the next emergency whether natural, public health,
or man-made is always just around the corner.
Let me touch specifically, but briefly, on some of the important
issues that I know the committee has under consideration. I recognize
that we must focus on not only what is needed, but also on what is
doable.
As rural providers, we find ourselves reacting to the economic
challenges of the communities we serve since they can affect our
patients' health and their ability to access care. These include
struggles with housing insecurity, affordable housing, stable
employment, and transportation. Because of these factors, we have
focused our broader community investment efforts on positively
impacting education, access to care, housing, and transportation, with
an emphasis on the underserved populations in our service area. We have
always believed in the importance of investing in our local community.
We have gone beyond the four walls of the hospital to help build
playgrounds, sponsor swimming lessons and sports teams, and build
community gardens. One of our most recent community collaborations was
the Union County Drug Treatment Court, which provides program support
that promotes and provides access to a continuum of alcohol, drug, and
other related treatment and rehabilitation services for individuals
diagnosed with a substance use disorder.
Living in our area can be a beautiful experience, but sometimes an
exhausting challenge. As wonderful as our rural lifestyle is, it can be
a trial for many rural residents, particularly those living in
communities surrounding La Grande with no access to public
transportation. Patients often miss, reschedule, or even cancel
appointments, delaying needed care. By developing sustainable
partnerships and voucher systems with local transportation services, we
helped 79 patients keep their appointments during FY 2023.
Pairing our local transportation services with an early and
significant investment in telemedicine allows us to meet the challenges
of delivering care in a rural setting. Our vision has always been to
seek out and bring the best health care available to the local
community. Since 2007, we have done that through our nationally
recognized and award-winning telemedicine program. Telemedicine in our
outpatient clinics provides access to specialties not available locally
including endocrinology, medical oncology, neurology, and post-stroke
recovery. As part of our inpatient and emergency services, we also use
our telehealth program to tap into specialty expertise typically only
available in larger cities. This includes using tele-hospitalists for
nightly call coverage, specialty physician teams when stroke, acute
myocardial infarction, trauma, or septic shock cases present in our
emergency department, and neonatologists and pediatric intensive care
specialists for our youngest patients. The telehealth flexibilities
provided during the pandemic were a lifeline that allowed for the safe
and effective care of COVID-positive patients while also ensuring
increased access to primary care and behavioral health visits that
decreased demand on our Emergency Department. Purchasing additional
equipment as well as configuring exam rooms and workspaces to pivot
quickly was the right thing to do for our patients and community.
Current telehealth flexibilities like the ones I described have
played a critical role in promoting access to vital health-care
services. Our experience shows the importance of telehealth care for
patients in rural and underserved areas, those with mobility issues,
and patients with transportation or other limitations that prevent them
from accessing in-person care in a timely manner. This is especially
important in a State like Oregon, which has limited inpatient bed
capacity. Telehealth gives us the opportunity to keep patients in their
local community for care, which benefits the rural patient, but also
the patient in the urban community who has access to that hospital bed
made available by the avoidance of a transfer. By extending telehealth
flexibilities permanently, we can create certainty for Medicare
beneficiaries, who will otherwise wonder if they will have continued
access to clinicians and services they are using virtually; strengthen
our health-care workforce by enabling a greater number of clinicians to
provide telehealth services; allow for investment in flexible virtual
staffing models that address current workforce shortages while
maintaining high-quality health care; and ensure continued investment
in the technology tools and infrastructure to offer telehealth
services. This is particularly critical for smaller providers like
Grande Ronde that cannot always afford to invest in these tools without
a reimbursement pathway.
Our efforts to improve services, enhance quality of care, and
expand access are tied to the workforce, and we feel fortunate that our
efforts and programs have seen results. Grande Ronde Hospital added
more than 45 providers during the 2020-2023 period. We are recruiting
additional primary care providers in family practice, internal
medicine, and obstetrics and gynecology.
We have a personal approach to reaching out to candidates across
the spectrum of both primary and specialty care, and through our
recruitment efforts we have expanded services and significantly
improved our patients' access to care. In 2021, our efforts to grow the
behavioral health services program attracted additional providers,
including Grande Ronde Hospital's first employed psychiatrist. The
integration of behavioral health care into our system has meant better
care for Union County residents.
Eight years ago, Grande Ronde Hospital established a nurse
residency program to attract, train, and retain nurses. Nurse residency
programs bridge the gap between school and practice through hands-on
professional development opportunities.
As a teaching hospital, the program made sense, and we are firm
believers in ``growing our own.'' Our evidence-based practice model,
which is tailored to the individual, has attracted nurses from across
Oregon. In 2019, we created a nurse residency educator position to
oversee the program, which has enhanced its success. We have been
successful with this program, graduating on average about six new
nurses a year, and often retaining all of them to work for Grande
Ronde. Many other rural hospitals do not have a way to integrate and
successfully onboard new graduates.
We have also partnered in multiple ways to help high school
students gain exposure to the depth and breadth of health-care careers.
We collaborate with our local high school on a ``Medical Pathway''
program, and we are also a partner with the Northeast Oregon Area
Health Education Center, which hosts an annual health career
exploration camp for high school students. Creating career pathways for
our youth helps with recruiting and retention of new health-care
workers and strengthens our local economy by keeping our talent in our
community. Any Federal support that provides incentives and support for
these types of programs should be a priority.
In a unique program, we partnered with our local school district's
student construction program to help build four townhouses for the
hospital. These townhouses will be used for our workforce when someone
is moving to the area or when providing services at the hospital on a
short-term basis. The La Grande School District originally received a
Federal grant to start the program at the high school.
Growing and supporting our workforce and protecting and expanding
services are two sides of the same coin when it comes to rural health
care. Neither can be achieved without the other and both require
adequate reimbursement and constant reinvestment. For example, Grande
Ronde implemented a new program in 2017 to combat the drug problem in
our community to bolster mental health services, but it required an
investment in our workforce and an expansion of our services.
And importantly for this hearing, I want to comment on our CHARM
program implemented in 2018, which is our Children and Recovering
Mothers Program. CHARM is a confidential health-care program for
pregnant women struggling with alcohol or drug addiction. Our Family
Birthing Center nurse manager has collaborated with local providers and
public health department officials to develop a program that improves
care and support for mothers and their infants. This includes early
pregnancy visits, rehab and behavioral health counseling, early nurse
home visits and parental classes. We have served 192 women and children
in the CHARM program and have had fewer neonates needing NICU care.
The investment in our CHARM maternity care program helped us
respond when a neighboring hospital 45 miles away closed its
obstetrical unit in 2023. In preparation, we quickly added two FTEs and
four RN positions, which proved to be necessary as we have seen a 65-
percent increase in patients from the neighboring county since the
closure occurred. While we were prepared and committed to meeting this
need, decisions like this are a constant juggling of limited financial
resources and a balancing of our larger workforce and service needs for
our community.
To help rural hospitals support and maintain maternity services,
policy solutions must consider that most of these patients are covered
by Medicaid and many have other health needs, which could include
chronic disease and behavioral health. Services can include a
combination of acute and outpatient care, in-home and telehealth
services, and we need enough flexibility to move between these settings
based on the patient's needs. I appreciate Senator Wyden's recognition
of many of the challenges to providing obstetrical care in rural
communities. I hope I can be helpful as we work toward policy
solutions.
Let me close by commenting on several flexibilities that were
allowed during the pandemic but were ended with the end of the public
health emergency last year. I have already addressed the importance of
extending telehealth flexibilities. In addition, the following
proposals would specifically help us meet the substantial discharge
challenges we face in Oregon. Discharge challenges due to shortages of
behavioral health beds and post-acute workers, delays in prior
authorization, and network inadequacies are especially challenging for
rural hospitals. The following proved successful during the pandemic
and should be reestablished:
Permanently remove the 96-hour condition of payment for
critical access hospitals to allow us to serve patients longer
than 96 hours and still satisfy Medicare's condition of
participation. This requirement is a barrier to meeting the
patient's needs and a burden for critical access hospitals like
ours that are unable to appropriately discharge their patients
and could continue to safely provide their care.
Reestablish the swing bed flexibilities allowed during the
pandemic that expanded the ability of hospitals to offer long-
term care services to patients who do not require acute care
but meet the skilled nursing facility level of care criteria.
If skilled nursing care is not available, then a rural hospital
should be allowed the maximum flexibility to swing the bed to
continue patient care as needed.
Permanently waive the three-day hospital stay rule for
patients requiring discharge to skilled nursing facilities.
This outdated rule fails to recognize what is best for the
patient and the cost of keeping patients in acute care settings
when a skilled nursing level bed is available.
It is an honor to serve my rural community. Thank you for the
opportunity to share my experiences in rural health care, and I welcome
your questions.
______
Questions Submitted for the Record to Jeremy P. Davis, MHA
Questions Submitted by Hon. Mike Crapo
Question. Millions of seniors and Americans with disabilities have
come to rely on telehealth as a lifeline, enabling access to a broad
range of clinicians and services. For residents of rural communities,
this can mean the difference between a 50-mile drive and the click of a
few buttons.
That said, without congressional action, Medicare telehealth
coverage will all but cease to exist at the end of 2024, creating a
dire cliff. Fortunately, data and experience from temporary extensions
can offer insights into the best path forward, ensuring seniors and
working families can continue to receive the care they need.
From an on-the-ground perspective, how have the current
flexibilities helped to provide high-quality care, and what would their
expiration mean for patient access moving forward?
Answer. Currently, FQHCs and RHCs can serve as a distant site
provider for nonbehavioral/mental telehealth services. Grande Ronde
Hospital (GRH) currently owns/operates three RHCs and the ability to
offer primary care patients the flexibility of a telehealth visit has
been a patient and provider satisfier, resulting in improved access to
preventive health-care services and reducing patients ER visits and
fewer hospital admissions. This becomes even more important during
periods of inclement weather (snow storms, et cetera) that make
transportation difficult in States like Oregon and Idaho. The very
nature of a Rural Health Clinic is that the community is likely
underserved in terms of the limited number of providers and being able
to maximize the skills and training of our workforce is enhanced
through available technology. By extending telehealth flexibilities
permanently, we can create certainty for Medicare beneficiaries, who
will otherwise wonder if they will have continued access to clinicians
and services they are using virtually; strengthen our health-care
workforce by enabling a greater number of clinicians to provide
telehealth services; allow for investment in flexible virtual staffing
models that address current workforce shortages while maintaining high-
quality health care; and ensure continued investment in the technology
tools and infrastructure to offer telehealth services. This is
particularly critical for smaller providers like Grande Ronde that
cannot always afford to invest in these tools without a reimbursement
pathway.
Question. What considerations and lessons learned should Congress
bear in mind as we evaluate permanent telehealth legislation?
Answer. My simple answer is to make the remaining COVID
flexibilities permanent to provide some relief to rural health-care
providers so that we can focus our time on other mission driven
priorities related to sustainable health-care access. I would encourage
the following given our experience:
(1) ensure Medicare patients can receive telehealth services in
their home.
(2) ensure there are no geographic restrictions for originating
site for nonbehavioral/mental telehealth services.
(3) allow some nonbehavioral/mental telehealth services to be
delivered using audio-only communication platforms;
(4) remove the requirement of an in-person visit within 6 months of
an initial
behavioral/mental telehealth service and annually thereafter. We have
found that many providers and patients will naturally have a face-to-
face encounter at some point but the one size fits all approach of
requiring an in-person visit is typically problematic for the most
difficult of patients and lots of resources are exhausted by clinic
staff to try and convince the patient to come in.
(5) make the program permanent so that patients have certainty and
providers will know there is a payment pathway if they invest in
telehealth.
Question. Are there additional pandemic-era flexibilities or
waivers that Congress should consider either restoring or continuing to
extend?
Answer. Yes. Here are a couple of significant interest to me.
1. Swing Bed Program--A COVID flexibility which ended with
PHE: The swing bed program was created in 1980 as a way to
transition rural patients from acute to skilled nursing level
care, especially when there are no post-acute beds/facilities
available. According to CMS regulations, a swing bed hospital
is a hospital or critical access hospital (CAH) participating
in Medicare that has CMS approval to provide post-hospital SNF
care and meets certain requirements. To qualify for SNF-level
services, a beneficiary is required to receive acute care as a
hospital inpatient for a medically necessary stay of at least 3
consecutive calendar days. During the PHE, CMS waived the
eligibility requirements to allow hospitals to apply for swing
bed services that were needed to provide skilled nursing
facilities (SNF) level care for non-acute care patients, this
was often done with just a call to the CMS hotline. These
flexibilities ended with the end of the PHE, however, the with
the post-acute bed shortage, reestablishing these rural
hospital swing bed flexibilities seems especially important as
a tool to meet the needs of rural patients and to allow rural
hospitals to better manage this care and reassure patients
their care will be stable when they transition from acute to
post-acute.
2. CAH 96-hour Rule--A COVID flexibility which ended with PHE:
During the PHE, CMS waived the requirements that CAHs have a
length of stay limited to 96 hours under the Medicare
conditions of participation. The so called ``96-hour rule''
flexibility ended with the end of the PHE. The combination of
post-acute bed shortage and the MA prior authorization delays,
make it especially untenable for CAHs to meet the 96-hour rule.
MA plan ``ghost'' networks for SNF beds add to the challenge of
discharging these patients. Many small rural hospitals found
they could keep sicker patients than they were previously, by
allowing CAH's to better serve their local community
unnecessary transfers (often Medicare beneficiaries) would be
reduced.
Question. Rural providers and patients can face substantial access
barriers to
cutting-edge medical devices and treatments, as well as AI-enabled
tools and technologies. Many of these innovations offer the potential
for cost savings in the long run, along with improved health outcomes,
but high up-front costs--coupled with ill-suited reimbursement models
and regulations--can pose hurdles.
How have you approached these types of common access gaps, and what
steps could Congress or CMS take to help bridge them?
Answer. At GRH we have adopted an AI governance process to help us
evaluate and implement AI-enabled tools and technologies to ensure that
any such adoption is safe for our patients, staff and providers--and
affordable.
______
Questions Submitted by Hon. Chuck Grassley
Question. We know that hemorrhages are a major underlying cause of
pregnancy-related deaths. Better prenatal care, telehealth, remote
monitoring, training for rural emergency rooms, and novel medical
devices can all play an important role in preventing maternal deaths.
What community-driven actions are important to ensuring women have
access to maternal health care when a local hospital closes its labor
and delivery unit?
Answer. Workforce shortages and low reimbursement are the two
biggest challenges to providing maternity care in our rural
communities. Finding ways to attract and retain OB clinicians is
especially hard when the annual volume of deliveries may be low. Add to
the mix that most of these rural maternity patients are covered by
Medicaid which pays less than the cost of providing the care. For
example, Oregon hospitals received 70 cents for every dollar spent
caring for Medicaid patients in 2022. And many State Medicaid programs
do not cover midwives or doulas which could otherwise help us extend
our workforce. At GRH, we are constantly recruiting additional primary
care providers in family practice, internal medicine, and obstetrics
and gynecology. For our nurses, we have established programs which
reflect our firm believers in ``growing our own.'' In 2018 we began our
CHARM to better support mothers and infants. By investing in our Family
Birthing Center it allowed our nurse manager to collaborate with local
providers and public health department officials to develop a program
that improves care and support for mothers and their infants. This
includes early pregnancy visits, rehab and behavioral health
counseling, early nurse home visits and parental classes. We have
served 192 women and children in the CHARM program and have had fewer
neonates needing NICU care. The investment in our CHARM maternity care
program helped us respond when a neighboring hospital 45 miles away
closed its obstetrical unit in 2023. In preparation, we quickly added
two FTE's and four RN positions, which proved to be necessary as we
have seen a 65 percent increase in patients from the neighboring county
since the closure occurred. While we were prepared and committed to
meeting this need, decisions like this are a constant juggling of
limited financial resources and a balancing of our larger workforce and
service needs for our community.
Question. Are there Federal regulations or administrative burdens
that drive up costs for rural providers? If so, what are they?
Answer. While often framed as transparency, the past few years have
resulted in an explosion of new Federal administrative requirements.
Even when the goals might be worthy, the hospital price transparency
and No Surprises Act requirements have resulted in significantly more
administrative burdens. And recent discussions about new cybersecurity
mandates and legislative proposals suggesting new 340B requirements
will be additional worries which will require a workforce and dollars
we don't have.
Question. I frequently hear from Iowans about poor access to
health-care services, especially in rural areas. In many States,
pharmacists, audiologists, and more are licensed and trained to perform
certain medical services that Medicare currently does not pay for. For
example, right now, pharmacists cannot get paid under Medicare Part B
rules for providing wellness screenings, immunizations, or diabetes
management. I support modernizing Federal rules.
Should modernizing Federal rules to match licensing and training
laws be part of efforts to strengthen and improve health outcomes for
patients?
Answer. Yes, yes, and yes! Anything that creates better alignment
that would encourage and support allowing any health-care provider to
practice to the top of their licensure would be fantastic. Given that
there is a shortage of health-care providers in this country we must
enlist the help of others like pharmacists, audiologists, etc. if we
want to get ``upstream'' in terms of health promotion and wellness.
Question. The Centers for Medicare and Medicaid Services (CMS) have
over 2,000 quality metrics in its inventory that health-care providers
submit data for. In 2005, the Finance Committee held a hearing on
quality metrics in Medicare. I said at the time, we did not want to
overburden providers with reporting requirements and it is important to
develop quality measures by consensus.
Should CMS go on a quality metrics diet? What quality measures do
patients care about and which ones should be kept to best capture
outcomes in health care?
Answer. Quality measures are an important part of national work to
improve quality and patient safety. However, when the measures are too
numerous or definitions too complex, data collection activities can
overwhelm hospital resources and hinder hospital's ability to actually
bring about improvement. A careful, focused approach to quality
measurement is especially important at a time when hospitals and health
systems are grappling with multiple challenges, including workforce
shortages, inflationary pressures on drugs, supplies, and labor, and
downward pressure on both governmental and private-sector payment.
We can appreciate CMS's efforts over the past several years to
streamline and focus the measures in their programs for hospitals and
health systems. The agency's ``meaningful measures'' framework has been
helpful for organizing the agency's measurement programs around a more
transparent and coherent set of priority topics. However, the volume of
measures hospitals are required to report under CMS programs is still
substantial, and some of the measures no longer add value because their
performance is approaching topped out status, or have substantial
methodological flaws. To further advance ``measures that matter'' the
most to patients, communities and hospitals, CMS should:
Continuously review the measures in their programs to
determine whether they align with meaningful measure priority
areas and have a meaningful performance gap, removing those
that do not;
Work to better align measures across public and private
payers to increase focus and reduce administrative burden and
inconsistency;
Ensure measures are as administratively simple to collect
and report as possible;
Prioritize the use of rigorously risk-adjusted outcome
measures that give patients more meaningful information about
hospital performance and hospitals greater flexibility in
designing their care to meet those outcomes;
Continue to use pre-rulemaking multistakeholder input on
both measure additions and removals in its programs; and
Phase out measures with low reliability or other known
methodological issues that affect their accuracy.
Question. Rural communities and hospitals are facing an ever-
growing challenge of staffing ambulances for emergency and transport
services. I am aware that CMS is conducting a multiyear data collection
of ground ambulance services.
Are there successful rural models to sustain ambulatory services?
If so, what makes them sustainable?
Answer. While GRH does not operate an ambulance service, having
ambulances for emergency and transportation services is critically
important to delivering care in rural communities. It is my
understanding that ambulance services are confronting the same
challenges as all rural providers, which include workforce shortages,
workforce safety, low reimbursement, poor insurance coverage, and high
costs (in this instance, high fuel costs). Just discharging a patient
from acute care in a hospital to post-acute care in a long-term care
facility can be challenging when no transportation is available. It's a
costly delay and clearly impacts patient care.
Question. In my 99-county tour of Iowa, I frequently hear about the
workforce shortages in health care. Some rural hospitals have
established community-led strategies to address their workforce needs.
This includes proactive engagement with middle and high school
students, supporting or developing a pipeline of health-care
professionals with a local college, professional school training
opportunities, and a robust recruitment strategy.
What should a comprehensive workforce strategy look like for a
rural hospital? If possible, please provide leading examples of rural
hospitals deploying a successful community-led strategy.
Answer. Great examples I have seen and been a part of include the
following. In addition, I would be more than happy to spend more time
with your staff to further discuss ideas and/or be part of a task force
or workgroup on this.
Early and often exposure to health care by children--
positive health-care interactions lead to curiosity, so
reinforcing and incentivizing well-child visits, preventive
screenings, telemedicine flexibilities, et cetera, can create
an early interest for the health-care field.
At a previous rural hospital I worked at in
Wyoming we brought kindergartners for a tour. It served two
purposes: (1) hopefully make the hospital less scary for them,
and (2) start recruitment early.
Shadowing opportunities: We have also partnered in multiple
ways to help high school students gain exposure to the depth
and breadth of health-care careers. We collaborate with our
local high school on a ``Medical Pathway'' program, and we are
also a partner with the Northeast Oregon Area Health Education
Center (NEOAHEC), which hosts an annual health career
exploration camp for high school students. Creating career
pathways for our youth helps with recruiting and retention of
new health-care workers and strengthens our local economy by
keeping our talent in our community. Any Federal support that
provides incentives and support for these types of programs
should be a priority.
Nurse Residency: 8 years ago, Grande Ronde Hospital
established a nurse residency program to attract, train, and
retain nurses. We have an almost 90 percent retention rate of
nurses who went through our program which is quite impressive.
The few that have left ended up leaving for family obligations,
career advancement, and desires to advance further into a
career specialty we don't offer. Nurse residency programs
bridge the gap between school and practice through hands-on
professional development opportunities. As a teaching hospital,
the program made sense, and we are firm believers in ``growing
our own.'' Our evidence-based practice model, which is tailored
to the individual, has attracted nurses from across Oregon. In
2019, we created a nurse residency educator position to oversee
the program, which has enhanced its success. We have been
successful with this program, graduating on average about six
new nurses a year, and often retaining all of them to work for
Grande Ronde. Many other rural hospitals do not have a way to
integrate and successfully onboard new graduates.
Financial Stability: It goes without saying that rural
hospitals need stable and consistent reimbursement from
programs like Medicare and Medicaid. Without stable finances it
is hard for rural health providers to attract a workforce that
will want to stay.
______
Questions Submitted by Hon. Maria Cantwell
Question. Nationwide, one in four rural hospitals have stopped
delivering babies. Washington State has seen multiple labor and
delivery ward closures in recent years, including by hospitals in
Toppenish and Bremerton.
Those closures are a wake-up call: hospitals in rural and
underserved areas need more support to be able to continue their
essential labor and delivery services. Many of these closures stem from
financial challenges. Programs that must operate 24/7 have fixed, steep
costs. For labor and delivery, that includes on-call time for
physicians, on-call time for anesthetists, and 24/7 availability of
labor and delivery nurses.
The costs of a maternity program do not decrease if there are fewer
births--but revenues do. For example, one hospital in Washington State
only delivers four babies per month on average, but still must pay for
24/7 coverage for OB-GYNs, c-section providers, anesthetists, and
nurses.
That's not financially sustainable. We must find ways to address
the root financial causes of labor and delivery ward closures in rural
and underserved communities.
Would increasing Medicaid reimbursements for labor and delivery
services help rural hospitals keep these services open?
Answer. Yes, this is an important first step. In many cases 40-60+
percent of labor and delivery patients are covered by Medicaid. I think
increasing the Medicaid payment rate for labor and delivery services
and providing a foundational payment for any rural or CAH that delivers
less than 350 deliverers a year would help shore up many of these
hospitals in terms of maintaining L&D services. In addition, an
increase in the Federal medical assistance percentage (FMAP) for labor
and delivery services at eligible hospitals would be helpful as well.
In case it helps, we lost about $600,000 on L&D services prior to the
closure of maternity services at a nearby hospital. As a result of the
closure, we have incurred between $500,000-$750,000 in additional
expense (wages, supplies, equipment) in order to be ready for the
additional volume. We will get some incremental revenue as a result of
additional deliveries but our team estimates we will lose close to $1
million once the dust settles. We aren't looking for a handout but a
hand up so we can continue to ensure access to such a critical service.
In addition, which folks often don't talk about, access to maternity
services could also been seen as an economic growth strategy as
businesses are likely to not set up shop in a community that doesn't
have maternal services. So I see a lot of synergy with other sectors
with a Federal investment in maternal access in rural areas.
Question. In your experience running a Critical Access Hospital,
what are the biggest financial obstacles to keeping labor and delivery
services sustainable?
Answer. The 24/7/365 nature of the service in which we can go
several days without a birth and then have six in one day coupled with
the labor and equipment costs given it is a specialized scope of
nursing. We have also invested in simulation training given our volumes
to maintain proficiency.
Question. Why is it important for rural patients to have access to
labor and delivery services in their home community?
Answer. Access to L&D services in a mother's local community is
both a health and human services imperative but an economic one as
well. Local care is often more affordable for the patient and the
insurer. Lack of access leads to delayed visits which in turn leads to
disparities that end up being more costly as more specialist have to
get involved not to mention that long-term health effects to the child
and mother in which those costs are born by employers, communities and
society as a whole.
Question. The COVID-19 pandemic revolutionized the use of
telehealth in our health-care system and served as a catalyst for its
expansion into many different areas of health-care service delivery.
Since the expansion, telehealth has proved to be extremely popular.
A recent report published by the Washington State Department of
Health shows that telehealth allowed more people in rural and
underserved areas to access care, increased prevention visits that
reduce more costly care further down the road, and saved money for
patients and the government. However, the COVID-era flexibilities for
Medicare payments for telehealth services will expire at the end of
this year.
Without congressional action, Medicare will not be able to
reimburse for a wide range of telehealth visits that have helped so
many people from the pandemic up until today.
That is why I cosponsored the CONNECT for Health Act, which would
permanently remove all geographic restriction on telehealth services,
allow more eligible health-care providers to offer the service, and
remove the in-person visit requirement.
These flexibilities are necessary to patients in medically
underserved areas for accessing mental health, sexual and reproductive
health, and other crucial health care.
Do you agree that telehealth has expanded access to care in
underserved areas and legislation such as the CONNECT for Health Act is
necessary to maintain this level of access to care?
Answer. Yes, I do agree that telehealth has been a wonderful
resource in expanding access to care in underserved areas and any
legislation that makes permanent the COVID-era flexibilities would be
critical to ensuring access to cost-effective health-care services in
rural and underserved communities. Make the program permanent so that
patients have certainty and providers will know there is a payment
pathway if they invest in telehealth.
Question. Do you think people in rural areas currently have the
technological means, including broadband access and digital literacy,
to fully benefit from telehealth services?
Answer. I believe we are at an inflection point in this country
where we've been advancing telehealth, and then the pandemic hit, and
we really saw a lot of providers and patients who actually learned to
love it where they were really reluctant to use it prior to, and now
they don't want to go back. They see it as a great tool to improve
access, especially for those patients that are really hard to get in,
whether it be transportation issues, mobility challenges, working
professionals, et cetera. As a result of the pandemic many individuals
learned to embrace technology so I do think rural Americans are
starting to embrace the technology and the timing is great to support
telehealth moving forward.
______
Questions Submitted by Hon. John Thune
Question. Similar to your experience in rural Oregon, South
Dakotans have long understood the value of telehealth. While Congress
has extended telehealth flexibilities in Medicare until December of
this year, we need permanent telehealth policies in Medicare, such as
those in bipartisan legislation I have led with my colleagues like the
Connect for Health Act and the Telemental Health Care Access Act.
Based on your work as a health-care provider in a rural community,
how would the patients you serve be impacted if current telehealth
flexibilities were not extended?
Answer. I believe we are at an inflection point in this country
where we've been advancing telehealth, and then the pandemic hit, and
we really saw a lot of providers and patients who actually learned to
love it where they were really reluctant to use it prior to, and now
they don't want to go back. They see it as a great tool to improve
access, especially for those patients that are really hard to get in,
whether it be transportation issues, mobility challenges, working
professionals, et cetera. Not extending the current telehealth
flexibilities I believe would be a wasted opportunity to continue the
shared goal of improving access while reducing costs for beneficiaries.
Couple this with workforce shortages across the country that are
exacerbated in rural communities and I think the impacts of not
extending the telehealth flexibilities will be exponential.
Question. How would permanent telehealth access in Medicare help
rural health-care providers better serve their patients?
Answer. Making the telehealth flexibilities permanent would be a
tremendous boost for health-care providers, especially those in rural
areas as telehealth allows more people in rural and underserved areas
to access care, helps increase prevention visits that reduce more
costly care further down the road which will save money for patients
and the government. Removing this cliff will be well received by
patients as well. Make the program permanent so that patients have
certainty and providers will know there is a payment pathway if they
invest in telehealth.
______
Questions Submitted by Hon. James Lankford
Question. Do you think that there should be increased CMS
enforcement mechanisms in place to ensure that MA plans are better
incentivized to have local providers in their networks in order to
maintain access to care in rural communities?
Answer. We have the lowest MA plan penetration of any area of our
State, so I feel less able to respond in detail, but all providers and
their patients are hurt when health plans, Medicare Advantage or not,
have incomplete, inaccurate, or ghost networks.
Question. Please explain the value of ambulance services, both
ground and air, to rural communities and rural hospitals? With your
partnership with those entities, how can we best move forward with
ensuring they are financially viable in order to keep providing their
services?
Answer. While GRH does not operate an ambulance service, having
ambulances for emergency and transportation services is critically
important to delivering care in rural communities. It is my
understanding that ambulance services are confronting the same
challenges as all rural providers, which include workforce shortages,
workforce safety, low reimbursement, poor insurance coverage, and high
costs (in this instance, high fuel costs). Just discharging a patient
from acute care in a hospital to post-acute care in a long-term care
facility can be challenging when not transportation is available. It's
a costly delay and clearly impacts patient care.
Question. My bill, the Rural Hospital Closure Relief Act, would
allow States to deem a small number of struggling hospitals as
``necessary providers,'' allowing them to gain access to the Critical
Access Hospital designation if they do not meet the current arbitrary
mileage requirements of CMS.
How has your community benefited from the Critical Access Hospital
designation?
Answer. Our hospital has benefited immensely by being a CAH. The
mere fact that it has stabilized finances for us by ensuring that we
receive relevant reimbursement from Medicare is just a fraction of the
benefits. Our hospital is the largest private employer in Union County
(approximately 26,000 residents) and so being a stable employer allows
other important sectors (education, business/industry, law enforcement,
public health, et cetera) to exist as part of a community framework.
With over $70 million in wages and benefits we provide some tangible
economic and social benefits beyond just the health-care access that a
CAH provides.
Question. Hospital consolidation has increased in recent years,
which can increase health-care costs for patients and limit patients'
choices in rural communities.
When a hospital system buys up all the medical facilities in a
community or even across many States, it often increases prices, which
can make it even more difficult for families to afford their health
care.
At the same time, we need to identify how to better support small
rural hospitals that operate on thin margins.
What can Congress do to support the financial viability of rural
hospitals? How do we balance support for rural facilities with
affordability for patients in those communities?
Answer. While I can understand congressional concerns about the
impact of consolidation, often the local hospital is the only option to
maintain rural physician practices. Often hospital involvement in the
medical practices can expand access and services, since hospitals treat
a higher percentage of Medicare and Medicaid patients (than independent
practices and ASCs) and can offer more complex patient care. This might
also include stabilizing post-acute patients while they wait for
behavioral health or SNF care. But the high percent of Medicare and
Medicaid patients seen by rural hospitals (often 70 percent or higher)
can result in a tenuous financial foundation. Equitable and adequate
reimbursement needs to be addressed if rural health care is going to be
stabilized.
______
Prepared Statement of Keith J. Mueller, Ph.D., Gerhard Hartman
Professor of Health Management and Policy; Director, Rural Policy
Research Institute (RUPRI); Chair, RUPRI Health Panel; and Director,
RUPRI Center for Rural Health Policy Analysis, College of Public
Health, University of Iowa
Chairman Wyden, Ranking Member Crapo, members of the Finance
Committee, thank you for holding this hearing on rural health and
giving me the opportunity to share my perspective on key issues and
related policy considerations. Since I last spoke to this committee in
2018 intractable challenges in hospital finance, meeting workforce
needs, and addressing leading causes of death in rural communities
remain. Yet we have seen the resilience of rural health providers and
organizations as they rose to meet the challenges of the COVID-19
pandemic and now keep their focus on improving health for members of
their communities. In my brief formal comments I will focus on rural
hospital evolution, rural activities of Medicare Advantage, MA, plans,
and Accountable Care Organizations, ACOs. I'll close with observations
about sharp points demanding immediate attention.
As we move to the health care delivery system of the future, which
takes full advantage of advances in chronic care management and
changing sites of acute care, the roles of rural hospitals have
evolved. They are now comprehensive care centers, with a much higher
percentage of total activities and revenues tied to outpatient
services. Transitioning to institutions that best serve rural residents
may require modernizing facilities, investing in new information
systems and technologies, and collaborating with community-based
organizations to address living conditions related to chronic health
problems. An obvious requirement is capital enabling significant
investments; and the USDA is a leading source of that capital, within
the rural development agency, community facilities program.
Additional capital investments in information systems, including in
cybersecurity protecting the information, and new technology, can
stretch capabilities of small hospitals who have operated on very thin
total margins and therefore lack reserves for large investments. They
can find themselves needing to join hospital networks to centralize
administrative functions and negotiate payment contracts. The networks
can be across rural hospitals, as well as affiliations with urban-based
systems. In networks or on their own rural hospitals can be a position
of strength in any negotiations because of their primary care base and
integration into their communities. In a payment environment shifting
to the importance of addressing health, rural hospitals and primary
care clinics can be advantaged. Rural hospital administrators and their
limited senior staff may lack experience and data analytics to leverage
their position in negotiations; programs providing technical assistance
supported by USDA and HRSA make a difference for those institutions.
Shifting to MA, I'll use work from the RUPRI Center for Rural
Health Policy Analysis which was formed in 2000 funded by the Health
Resources and Services Administration Federal Office of Rural Health
Policy. We have tracked rural enrollment in MA plans since October of
that year when 201,655 beneficiaries were enrolled in Medicare+Choice
plans. As of March of this year there are 4,734,003 rural beneficiaries
enrolled MA plans, 45.1 percent of all rural beneficiaries, see Table 1.
Table 1: Enrollment in Medicare Advantage Plans, 2019 and 2024
----------------------------------------------------------------------------------------------------------------
National Percent of Percent of
Enrollment Eligibles Rural Enrollment Eligibles
----------------------------------------------------------------------------------------------------------------
2019 21,912,432 40.3% 2,876,598 29.1%
----------------------------------------------------------------------------------------------------------------
2024 31,177,866 52.3% 4,734,003 45.1%
----------------------------------------------------------------------------------------------------------------
SOURCE: RUPRI Center for Rural Health Policy Analysis, preliminary analysis based on Centers for Medicare and
Medicaid Services (CMS) data, as of March 2024.
Note: Excludes enrollees in U.S. territories (due to data incompatibilities).
Growth in rural enrollment in many States has been dramatic since
2019; Table 2 shows the percent of beneficiaries enrolled in 2019 and
2024. As evident in the table, enrollment growth is quite dramatic,
with only Alaska still having lower than 10 percent total, and nearly
all States well above 20 percent to as high as more than 60 percent.
More of the story of what is happening may revealed by examining
specific counties in States with high numbers of rural Medicare
beneficiaries. We have developed some early maps showing the contrast
from 2019 to 2024, presented in this document after Table 2. The
changes are obvious in observing the increased number of counties in
the darkest shade and the near disappearance of the lightest shade in
four of the six States illustrated.
Table 2: Enrollment in Medicare Advantage Plans, by State, 2019 and 2024
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
2019 Total 2019 Rural 2024 Total 2024 Rural
State -------------------------------------------------------------------------------------------------------------------------------------------------------
Eligible Enrolled Eligible Enrolled Eligible Enrolled Eligible Enrolled
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Alaska 81,415 2.1% 26,240 1.9% 97,413 2.8% 30,891 2.5%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Alabama 962,963 44.8% 259,680 36.3% 1,024,371 64.0% 267,977 62.2%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Arkansas 588,083 28.1% 261,456 25.9% 626,168 48.2% 268,805 47.0%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Arizona 1,200,467 44.0% 67,426 26.6% 1,358,579 54.9% 76,508 47.1%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
California 5,510,735 49.0% 195,542 8.3% 6,126,479 56.6% 206,172 16.6%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Colorado 809,098 46.0% 130,909 21.8% 929,919 57.2% 150,275 38.0%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Connecticut 605,051 45.1% 38,160 40.6% 628,847 52.4% 40,135 47.9%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Dist. of Columbia 76,328 22.7% 79,455 39.6%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Delaware 190,089 17.4% 222,068 34.4%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Florida 4,220,918 48.8% 147,368 33.8% 4,754,205 59.9% 162,353 52.7%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Georgia 1,565,339 42.9% 357,563 39.5% 1,757,771 59.9% 387,396 60.3%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Hawaii 233,551 53.3% 52,018 41.3% 263,746 61.7% 61,250 54.7%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Iowa 576,499 24.0% 274,989 15.7% 633,761 39.6% 293,193 31.5%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Idaho 306,090 36.4% 106,860 23.6% 360,795 51.9% 123,636 40.7%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Illinois 1,996,966 30.0% 318,054 21.9% 2,161,795 47.3% 332,033 39.5%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Indiana 1,158,322 34.1% 294,909 31.0% 1,266,994 52.9% 316,209 50.9%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Kansas 486,599 20.2% 178,760 7.8% 537,221 36.0% 189,024 22.5%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Kentucky 850,777 35.8% 409,180 32.1% 903,748 57.6% 422,097 59.3%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Louisiana 796,623 40.9% 144,855 24.1% 864,806 59.8% 152,244 49.3%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Massachusetts 1,180,663 27.8% 22,809 19.0% 1,294,557 39.4% 25,984 27.9%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Maryland 886,137 14.2% 35,533 6.4% 977,374 27.4% 38,450 19.7%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Maine 309,503 37.7% 139,759 33.9% 345,647 61.5% 154,242 60.6%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Michigan 1,915,848 44.4% 431,580 38.6% 2,087,568 65.6% 472,829 63.1%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Minnesota 931,818 49.4% 275,226 45.4% 1,052,916 63.9% 301,844 58.9%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Missouri 1,124,181 39.9% 337,902 28.4% 1,222,114 57.1% 356,050 49.1%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Mississippi 561,054 21.4% 326,577 16.7% 595,420 45.0% 338,429 43.0%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Montana 209,413 21.1% 141,333 19.0% 239,102 31.8% 161,829 29.8%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
North Carolina 1,841,513 39.4% 490,858 32.3% 2,054,364 58.9% 524,956 56.8%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
North Dakota 118,630 20.3% 65,155 15.9% 133,809 37.0% 71,564 33.3%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Nebraska 313,805 18.0% 134,159 8.2% 349,046 36.5% 144,642 27.3%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
New Hampshire 263,499 20.4% 114,649 19.5% 303,679 38.6% 131,117 38.6%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
New Jersey 1,415,809 33.3% 1,548,262 45.4%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
New Mexico 376,869 40.1% 127,411 23.4% 417,414 54.1% 135,919 44.8%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Nevada 467,819 42.2% 61,596 24.9% 534,651 56.4% 69,540 38.5%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
New York 3,213,675 45.9% 293,266 41.4% 3,527,243 56.6% 317,176 56.8%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Ohio 2,134,329 46.6% 480,827 35.4% 2,321,531 59.8% 515,972 52.3%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Oklahoma 668,082 23.8% 259,105 13.4% 727,493 44.0% 272,142 35.7%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Oregon 783,740 49.7% 169,107 22.1% 865,671 59.1% 184,192 32.2%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Pennsylvania 2,477,094 46.6% 336,514 43.7% 2,679,216 57.5% 356,654 59.4%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Rhode Island 192,558 51.8% 215,587 65.8%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
South Carolina 994,370 31.9% 173,617 34.6% 1,130,161 48.5% 186,418 53.6%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
South Dakota 158,706 23.4% 82,557 21.3% 179,370 39.0% 91,025 35.4%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Tennessee 1,250,487 42.9% 357,326 37.1% 1,358,749 56.5% 378,039 53.6%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Texas 3,739,559 43.6% 602,788 33.1% 4,277,896 58.5% 647,669 50.6%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Utah 355,224 41.6% 48,758 19.8% 415,102 56.9% 58,418 40.1%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Virginia 1,341,435 24.1% 264,255 25.6% 1,496,450 42.2% 276,702 47.6%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Vermont 132,806 13.0% 95,552 12.7% 150,400 35.0% 107,058 33.1%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Washington 1,220,424 37.2% 178,496 15.6% 1,370,121 53.4% 198,876 32.7%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Wisconsin 1,082,360 46.4% 342,196 41.8% 1,219,762 60.5% 383,009 56.0%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
West Virginia 407,206 35.8% 168,723 34.7% 420,214 57.3% 171,386 58.3%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Wyoming 99,394 5.1% 69,107 4.9% 116,022 18.5% 81,593 17.4%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
SOURCE: RUPRI Center for Rural Health Policy Analysis, preliminary analysis based on Centers for Medicare and Medicaid Services (CMS) data, as of March 2024.
Note: Excludes enrollees in US territories (due to data incompatibilities). The states of Delaware, New Jersey, and Rhode Island and the District of Columbia contain no rural counties.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
What are the consequences of the growth in MA plan enrollment?
Well, it is a two-sided coin. On one side, as RUPRI has shown in annual
reports and periodic policy briefs, there are many more choices for
rural beneficiaries. This includes more widespread availability of
additional health benefits including vision, hearing, fitness, and
dental--as of 2022 all are available in more than 90 percent of rural
counties. There are differences in expanded benefits such as in-home
support services (54 percent in remote compared to 82 percent in
metropolitan counties) and in special supplemental benefits such as
food and produce--available in 91 percent of metropolitan counties and
64 percent of remote counties. On the other side of the coin, MA plan
payment to rural provides is set through contracts, not the pricing
system of traditional Medicare. Consequently, payment is not cost-based
or other special payment as it is traditional Medicare, and strategies
private insurance companies use to control spending will apply--claims
denial (can be appealed), prior approval, and variable deductibles and
copayments. This coin metaphor brings to mind the term ``managed
competition''--that in health care there is value to competition, but
given compelling objectives of access and equity, some public policy
management may be needed.
The number of ACOs grew from 456 in 2023 to 480 in 2024, and
included 276 low-revenue ACOs, a jump from 252 in 2023. The number of
beneficiaries is holding somewhat steady at 10.8 million. There are
more than 2,500 participating Rural Health Clinics and 513
participating CAHs. Rule changes promulgated in 2022 that took effect
in 2023 and 2024 may influence more rural participation: up to 7 years
in an upside risk only model, and an advanced investment payment--19
started with the advanced payment in 2024. RUPRI has followed ACO
development in rural places and impacts on rural providers, including
finding a positive impact on rural hospital revenues. The CMS Shared
Savings Program Fast Facts show the data regarding participants and
assigned lives, including a map showing assigned beneficiaries by
county.
The RUPRI Health Panel, supported by the Helmsley Charitable Trust,
has commented on proposed rules and requests for information, including
from this committee and from the House Committee on Ways and Means.
Based on those letters, Panel papers, and discussions with my Panel
colleagues, I will close with what I characterize as ``sharp point''
concerns in rural health that demand attention. The first is
longstanding, but with new twists thanks to changes in delivery models:
securing the workforce needed to sustain rural services. A modern
patient health team now includes community health workers, lay health
navigators, behavioral health providers, and of course medical care
providers. All are in short supply and high demand. We need a multi-
pronged approach to meeting this needs, from pipeline training
programs, to better pay and benefits, to improving workplace
environments. A second sharp point is maintaining essential services in
rural communities. As already discussed today, this includes OB/GYN--
perinatal and postnatal women must have equitable access to high-
quality care. Other essential services include emergency care, primary
care, and public health. Other services could be included, but these
are fundamental building blocks in the continuum of care. Finally,
providing the range of services needed by an aging population is a
critical need in rural communities--recent closures of rural nursing
homes is creating a service gap that needs attention.
Thanks again for this opportunity to discuss critical issues and
policy considerations that would strengthen and sustain essential
health services in the Nation's rural communities.
______
Questions Submitted for the Record to Keith J. Mueller, Ph.D.
Questions Submitted by Hon. Mike Crapo
Question. Millions of seniors and Americans with disabilities have
come to rely on telehealth as a lifeline, enabling access to a broad
range of clinicians and services. For residents of rural communities,
this can mean the difference between a 50-mile drive and the click of a
few buttons.
That said, without congressional action, Medicare telehealth
coverage will all but cease to exist at the end of 2024, creating a
dire cliff. Fortunately, data and experience from temporary extensions
can offer insights into the best path forward, ensuring seniors and
working families can continue to receive the care they need.
From an on-the-ground perspective, how have the current
flexibilities helped to provide high-quality care, and what would their
expiration mean for patient access moving forward?
What considerations and lessons learned should Congress bear in
mind as we evaluate permanent telehealth legislation?
Are there additional pandemic-era flexibilities or waivers that
Congress should consider either restoring or continuing to extend?
Answer. A complete termination of the waived provisions for
Medicare telehealth coverage would result in declining access to
services in those instances where telehealth has provided a means of
contact with health-care providers that otherwise would not exist. This
is particularly true for behavioral health services, for which
utilization increased during the PHE and continues to remain above pre-
PHE levels. While research is ongoing, early findings indicate patients
who were previously unserved are now under the care of a behavioral
health provider. This results from more convenient access (no travel)
and a stronger sense of privacy (not being seen going to a behavioral
health clinic). Certain subspecialty services, such as oncology, are
also more accessible to rural residents thanks to telehealth. There is
limited use of Hospital at Home in rural places, but ending coverage
would be premature. Finally, an abrupt end to the waivers could stifle
innovation in telehealth that would improve integrated care for rural
patients.
Determining and providing adequate payment to providers delivering
services through telehealth is a challenge. At a minimum, provider time
needs to be compensated. Beyond that we stronger evidence regarding the
total cost of delivering services through this mechanism. For example,
while the overhead costs of engaging with patients through virtual
technology may be less than those associated with office visits, they
are nonetheless real and need to be considered. Further, the net
benefit of using telehealth needs to include return on investment from
early and continuous interactions with patients with chronic
conditions, including behavioral health and substance use. Seen through
a different lens, guard rails may be needed to prevent telehealth use
from totally supplanting in-person patient care, especially rural and
underserved populations. We need to be confident we will not exacerbate
issues of equity if telehealth is used to serve those of us who have
the capacity to use those services, but not made affordable and
accessible for the entire population in any region. Specifically,
allowing health plans to meet network adequacy standards through
telehealth could potentially siphon insured patients away from local
providers leaving them hard-pressed to continue serving others in the
community.
The RUPRI Health Panel, supported by the Leona M. and Harry BV.
Helmsley Charitable Trust, produced a detailed paper (https://
rupri.org/wp-content/uploads/The-Role-of-Telehealth-in-Post-Pandemic-
HP-February-2023.pdf) that provides a comprehensive assessment of the
role of telehealth in achieving a high-performing rural health system.
Our key consideration in that document reinforces my earlier response
about the balance of gains and threats from telehealth use: ``ability
to attract local consumers to distant providers may threaten local
infrastructure by attracting insured patients (and the revenue streams
they generate) away from local providers. The remaining population,
either publicly insured or uninsured, may not generate sufficient
revenue to sustain local practitioners. Services provided via
telecommunications, even when appropriate, may pose challenges to
affordability if they change direct out-of-pocket responsibilities of
low-income residents. On balance, potential advances to achieving the
HPRHS [high-performing rural health system] as a result of telehealth
appear to outweigh risks to access and affordability, but vigilance is
required.''
The Panel's specific analysis identified other considerations
related to optimum use of telehealth:
Expanding access to broadband capacity in rural households.
Matching telehealth services to the capacity of rural patients,
including the use of audio-only technology.
Assessing the value of specific telehealth services in the
context of avoiding more expensive utilization of services resulting
from delays in seeking care.
Question. Rural providers and patients can face substantial access
barriers to
cutting-edge medical devices and treatments, as well as AI-enabled
tools and technologies. Many of these innovations offer the potential
for cost savings in the long run, along with improved health outcomes,
but high up-front costs--coupled with ill-suited reimbursement models
and regulations--can pose hurdles.
How have you approached these types of common access gaps, and what
steps could Congress or CMS take to help bridge them?
Answer. Drawing on interviews of health system leaders focused on
rural needs recently completed by the RUPRI Center for Rural Health
Policy Analysis, with funding support from the Federal Office of Rural
Health Policy, I offer these observations:
Ensuring ubiquitous high quality broadband access continues to
be a rural need.
Continued investment in electronic health record capability is
necessary; grant programs targeting low-revenue providers could be
helpful.
Technology that uses mobile units to make specialty services
available (for example, by miniaturizing some of the diagnostic
equipment and connecting to remote specialists through telehealth)
helps bridge gaps in access to specialty care. There may be
implications for allowable costs in Medicare payment policies.
Question. Alternative payment models, or APMs, could offer
potential opportunities for rural providers, but to date, participation
has remained low, due in part to administrative burden and up-front
costs, as well as to certain design features.
For rural hospitals and clinicians that do participate, attracting
specialists also remains a widespread challenge. Roughly two-thirds of
rural counties, for instance, lack an oncologist, despite higher rates
of cancer mortality.
What steps could Congress or CMS take to make APMs a more viable
option for rural providers and what lessons should we take away from
previous efforts to increase adoption of these models in rural
communities?
Answer. The following steps could be taken through legislation and
regulatory policies:
Limit downside risk for rural-based health-care organizations:
CMS recently took an important step in this direction for new, low-
revenue ACOs.
Provide investment capital, either as a guaranteed loan to be
repaid from future savings, or as an outright grant.
Facilitate cross-state licensing and credentialing.
Understand dynamics of all revenue streams; e.g., the CEO of
Genesis Health in southeast Ohio testified on June 4th to the House
Energy and Commerce Subcommittee on Oversight that savings realized
from 340B enabled investment in service lines such as oncology, which
in turn enabled more effective participation in value-based payment
models.
Establish alignment across quality measures and reporting to
reduce burden; especially for small rural (RHV documents from summit
and more recent document).
references
Advancing Value-Based Payment Policies Relevant to Rural Areas--
Continued Challenges and New Opportunities. Rural Health Value. 2023.
https://ruralhealthvalue.public-health.uiowa.edu/files/
Advancing%20Rural%20VBP.
pdf.
How to Design Value-Based Care Models for Rural Participant
Success: A Summit Findings Report. Rural Health Value. https://
ruralhealthvalue.public-health.uiowa.edu/files/
Rural%20VBC%20Summit%20Report.pdf.
Question. Research shows that small rural hospitals paid under
Medicare's traditional inpatient payment system are also facing certain
financial stressors.
Do you believe that some small rural hospital financial
difficulties stem from a lack of commercial payer reimbursement?
What would be an appropriate Medicare margin for these small rural
hospitals to make?
What Medicare policy changes would be most impactful in both the
short and long term?
How has Medicaid expansion, specifically the shift from private
health coverage to Medicaid, impacted the long term financial viability
of rural hospitals?
Answer. The short answer is ``no.'' Nearly all rural hospital CEOs
and CFOs I have talked to or heard speak in public forums identify
commercial payer reimbursement as their most favorable source of
payment. But there are nuances: commercial contracts are not all alike
and there may be some that pay less than Medicare; even if they are the
best source of payment commercial payers may have negotiated less
favorable terms in the past 2 years; and Medicare Advantage plans are a
form of commercial payment and there is growing concern from hospital
leaders that the net payment (after the costs of appealing denials, and
negotiations on final prices) is less than they had been paid by
traditional Medicare.
This is not an easy question to answer because of variability in
measuring operating costs, which of course affects margins. That
complication aside, any net positive margin from Medicare payment would
be helpful to rural hospitals.
In the immediate and short term Congress should continue current
payment policies that recognize the financial circumstances of rural
hospitals (CAH, SCH, MDH, RRC, and REH). Per the discussion during the
hearing and answers to subsequent questions, I could support making
those policies either permanent or guaranteed for extended years. Long-
term, though, policies should employ a tiered payment design for
qualified hospitals, which recognizes the fixed costs of assuring
access to services in places where the volume of patients paying at or
above costs will not support all costs. The RUPRI Panel, with Clint
MacKinney as lead author, published a description of this approach in
2023: MacKinney, C., Mueller, K., A. F., Knudson, A., Lundblad, J. &
McBride, T. (2023). Modernizing payment to critical access hospitals: A
proposal for the next iteration of the Flex Program. The Journal of
Rural Health 39 (4) 716-718. DOI: http://dx.doi.org/10.1111/jrh.12750.
Designing this policy is challenging under any circumstances; the
changing landscape of health system organizations makes it even more
complicated, but not impossible.
The underlying dynamic that policies need to address is achieving
the dual goals of preserving the safety net while modernizing the
payment structure. A two-tiered approach accommodates this by using one
payment stream associated with well-defined characteristics of safety-
net status and a second payment stream that is consistent with general
approaches to value-based payment. A study from the RUPRI Center found
a higher fixed-to-operating-cost ratio in small rural hospitals (Barker
AR, MacKinney AC, and McBride TD, Policy implications of fixed-to-
total-cost ratio variation across rural and urban hospitals. Journal of
Rural Health 39 (4) autumn 2023, 734-745; https://
onlinelibrary.wiley.com/toc/17480361/2023/39/4).
The impact of Medicaid expansion on private insurance has been
studied using different techniques, yielding different results. A
recent study published by one of my colleagues, using sophisticated
econometric methods, found a modest effect--a decline of 1.5 percentage
points in private insurance rates in expansion States as compared to
non-expansion States (https://onlinelibrary.wiley.com/doi/10.1111/
ssqu.13318). Other published studies have shown a strong association
between being located in a non-expansion State and rural hospital
closures. Given those two sets of findings, while there may be
instances of Medicaid crowd out of private coverage affecting net
hospital revenues, in the aggregate I have not seen research supporting
that to be a an issue for most rural hospitals.
Question. Creating opportunities for rural providers to participate
in value-based payment models is critical to transitioning to a health-
care system that rewards quality instead of simply paying for the
number of services provided.
There are a small number of ACO participants located in rural
markets. How have some providers been successful in getting attributed
Medicare patients to stay within the ACO network? Why are a few, select
rural organizations able to meaningfully participate in an advanced ACO
program while most rural providers struggle to join even in the non-
risk-bearing ACO and Medicare Shared Savings Program (MSSP) models?
What statutory or regulatory changes would be necessary for ACOs
located and operating in geographically rural and frontier parts of the
country to take on two sided risk?
What changes do you think Congress and the administration should
consider to help rural and frontier communities tailor value-based
payment models that meet their unique circumstances?
Answer. Research conducted by the RUPRI Center through four case
studies in 2021 identified these success factors:
Prior collaboration experience.
Volume-to-value transformation strategic focus.
Clinician championship.
Care coordination services.
Data access and analysis.
The Center's analysis of secondary data in 2020 identified these
factors:
Fully implemented electronic health record systems.
Medical homes for patients.
Previous risk experience such as HMOs or PPOs or capitated
or bundled payment contracts.
We have also examined characteristics of rural ACOs who
transitioned to 2-sided risk ACOs, with these characteristics emerging:
ACO size is related (i.e., larger ACO's tend to be more
successful).
Affiliation with supporting organizations.
Performance on quality and savings measures.
references
High-Functioning Rural Medicare ACOs--A Qualitative Review.
RUPRI Center Policy Brief. February 2021. https://rupri.public-
health.uiowa.edu/publications/policybriefs/2021/High-
Perf%20Rural%20ACOs.pdf.
Rural Hospital Participation in Medicare Accountable Care
Organizations. RUPRI Policy Brief. 2020. https://rupri.public-
health.uiowa.edu/publications
/policybriefs/2020/
Rural%20hospital%20participation%20in%20ACOs.pdf.
Medicare accountable care organization characteristics
associated with participation in 2-sided risk. Journal of Rural
Health 39 (1). https://onlinelibrary.wiley.com/doi/10.1111/
jrh.12672.
The factors that may keep rural providers for considering advanced
payment models are: (1) ability to have a sufficient pool of
beneficiaries to justify the investment and operational costs; and (2)
inertia if they have established a pattern of financial stability.
Two actions could be helpful: (1) risk corridors that minimize the
impact of downsided risk to a small percentage of total revenue; and
(2) investment capital up front and perhaps again on first or second
renewal.
Work referred to earlier by the Rural Health Value team provides
insights:
Advancing Value-Based Payment Policies Relevant to Rural
Areas--Continued Challenges and New Opportunities. Rural Health
Value. 2023. https://ruralhealthvalue.public-health.uiowa.edu/
files/Advancing%20Rural%20VBP.
pdf.
How to Design Value-Based Care Models for Rural Participant
Success: A Summit Findings Report. Rural Health Value. https://
ruralhealthvalue.
public-health.uiowa.edu/files/
Rural%20VBC%20Summit%20Report.pdf.
Question. In 2022, the National Quality Forum (NQF) released an
updated report outlining a core set of 37 quality measures tailored to
address the needs of rural populations. The new measure set included 21
hospital measures and 16 ambulatory care measures. These quality
measures had certain characteristics in common, making them relevant to
rural communities. They were cross-cutting, resistant to low case
volume, and focused on the coordination of care transitions for high-
acuity patients.
Rural hospitals and providers want to demonstrate the high quality
of care they deliver, but often cannot report on the same types of
quality measures as urban facilities. Certain rural stakeholders argue
that the NQF measure sets missed the mark--focusing more on process
measures than on outcomes measures. Do you have any suggestions on how
to most effectively implement value based reimbursement for rural
hospitals and providers?
Answer. I would be happy to have more time to look up the reports
done for the National Qualify Forum on this question. In my years
engaging with them we processed special studies of how to design
measures for low-volume providers, and developed measures specifically
for rural providers (mostly hospitals). That work is, I believe, being
continued by the new CMS contractor, Batelle.
A general recommendation is to alignment quality measures across
payers so that the same measures are used by all. This would increase
the number of cases with the same measure, creating the opportunity to
have the volume needed to make the measures meaningful. That is, the
data could be aggregated across all payers.
Question. Because not every rural town can support a full-service
hospital, rural researchers, stakeholders, and nonpartisan public
policy think tanks have called on Congress to give States and
communities more flexibility to design locally driven health-care
solutions.
Given the currently available range of special Medicare rural
hospital designations and provider payment add-ons, what specific
changes do you recommend this committee consider to help vulnerable
hospitals maintain community access to needed medical care?
How can the Federal Government continue to partner with States and
local communities, but give local leaders the freedom and the
flexibility to design solutions that work best for them?
Answer. Previous answers have touched on this somewhat. A further
consideration would be to end sequestration in hospital payment,
perhaps for a specific group based on classification and size. Another
consideration is to instruct CMS to be certain that when new payment
models are implemented to be sure that any necessary adjustments are
made to Conditions of Participation. The best example I can report of
this was a change to COPs after evidence demonstrated the efficacy of
telehealth for emergency room presence of a physician; the COP
requiring the physical presence of a physician was changed. As
mentioned in an earlier answer, all revenue streams that are helpful to
rural hospitals as they struggle to maintain essential services in
their communities should be considered, such as 340B, and swing beds
for post-discharge care. Similarly, policies reducing revenue such as
sequestration should be reconsidered.
Another idea for working with State and local communities would
will require a great deal more thought and development. HHS could make
grants available to local consortia who submit plans to improve
sustainability of services in their areas--the consortia could be
defined to be two or more entities. The proposal would be required to
include plans for consolidated payment from multiple sources. This
could initially be a demonstration program, perhaps building off of the
current network grant program in HRSA.
Question. One reason that rural hospitals can struggle financially
is due to the fact that reimbursements may not cover high fixed costs.
Some rural stakeholders have called on Congress to increase the cost-
based reimbursement percentage that CAHs receive from the Medicare
program to furnish health-care services. Today CAHs are paid 101
percent of cost per case. Some would like to see that figure increase
substantially, which would be an extremely expensive policy change.
If Congress were to increase the cost-based reimbursement
percentage, would hospitals still have incentives to be efficient in
providing health-care services?
What, if any, other reforms should Congress consider in tandem with
a payment increase to promote movement toward lower costs and improved
health outcomes?
Answer. I am answering these questions assuming sequestration is
ended, which would result in CAHs being paid 101 percent of cost. My
direct answer to the first question is ``yes.'' Not all payers would
use the same cost-based reimbursement, unless as a platform for making
their payment a percentage of the Medicare payment. Therefore,
hospitals would still gain from continuous improvement in efficiencies.
Further, given workforce needs, all health-care organizations need to
be efficient using scarce resources. As described in an earlier answer
there are short-term needs to continue the current array of services in
rural communities, and longer-term needs to redesign payment policies
to promote and reward high-quality, low-cost care.
A key reform to help move toward value-based payment and determine
reasonable total costs in a rural setting is a shared savings model
structured with incentives to achieve an optimal balance of services
across the care continuum. If hospitals see a pathway to secure
sufficient revenues to continue essential services, they could shift
mix and site of services to meet community needs, their mission. For
hospitals to succeed in such a transformation, many will need extensive
technical assistance. Current programs funded by USDA and HRSA are
demonstrating results in improving hospital finance and enabling
change. The two-tiered approach to hospital payment described earlier
would be helpful.
Question. The Biden administration recently finalized a
controversial regulation implementing minimum nurse staffing standards
in skilled nursing facilities and long-term care nursing facilities
nationwide. CMS now estimates this one-size-fits-all, unfunded mandate
will cost facilities $43 billion over 10 years, an increase of $2.4
billion compared to the proposed rule. According to KFF, only 19
percent of facilities nationwide will be able to meet the new staffing
standards once the rule is fully implemented.
Given existing workforce shortages in rural areas, how will the
administration's nurse staffing mandate affect rural hospitals' ability
to hire high quality providers?
The CMS final rule does not include financial resources to hire the
staff necessary to comply with the mandate. Is there a risk that these
new staffing minimums will either force facilities to limit patient
capacity or close altogether?
Answer. To preface my answer, there is a need to expand the total
pool of labor across all health professions, including nursing at all
levels; this means considerations for hiring foreign-trained
professionals, training more local workforce, and engaging all
institutions (hospitals, nursing homes, clinics). Given that reality,
if any one group of providers (nursing homes) succeeds in recruiting
large numbers of nurses, another (hospitals) may not be able to meet
their needs. There are many variables in play that make projections
risky: the staffing requirement is phased in, with extended time for
all nursing homes, 3 years in urban areas and 5 in rural areas. The
rule creates an exemption for nursing homes in shortage areas that are
unable to recruit additional staffing. As was at least inferred during
the hearing, even these adjustments may not be sufficient to address
rural needs. The RUPRI Panel recommended CMS consider even longer time
lines, especially given the reality that nearly 80 percent of all
nursing homes could not currently meet the new ratios.
While the new standards may pose hardships for facilities, the goal
of improving quality in all nursing homes is laudable. Over time CMS
could move from a measure based on inputs such as staffing ratios, to
one based on outcomes independent of staffing arrangements.
Additionally, CMS could use existing programs to focus on assistance to
nursing homes by providing guidance and technical assistance.
Specifically, quality improvement organizations could be engaged
through their scope of work, and state surveyors could help identify
specific needs for improvement and technical assistance.
The Panel's comment letter on the proposed rule (https://rupri.org/
wp-content/uploads/RUPRI-Panel-Letter-re-Minimum-Staffing-Standards-
11.05.pdf) included these recommendations:
Increase base funding, and funding for training and
technical support for State surveyors, as well as better
coordination between State surveyors and the CMS-designated
Quality Innovation Network Quality Improvement Organizations.
Create a policy focus to increase the quantity and
composition of the staffing pool in a way that does not pull
resources from elsewhere, which could include decentralizing
training programs into rural environments, and pooling staff in
geographic regions.
CMS should implement, to the extent possible within
statutory constraints, other recommendations of the Committee
on the Quality of Care in Nursing Homes, National Academies of
Sciences.
CMS should consider including all nurse staffing categories
to deliver services available to and needed by residents in
underserved areas, including use of licensed practice nurses,
an especially vital component of rural nursing home staffing.
Yes, there is at least some risk that enforcement of the standards
could lead to closure of rural nursing homes. The cost of meeting the
regulations could also result in changes in patterns of care, another
reason to use outcome measures.
______
Questions Submitted by Hon. Chuck Grassley
Question. In recent Finance Committee hearings with Health and
Human Services Secretary Becerra, we have discussed the Department of
Health and Human Services' inaction to fill open spots in the Rural
Community Hospital Demonstration program. Right now, the Centers for
Medicare and Medicaid Services (CMS) is only using 25 of its statutory
30 hospital spots for this program. At my request, the Center for
Medicare and Medicaid Innovation Director met with two rural Iowa
hospitals interested in joining the program. However, that is where
progress has stalled. CMS explained that to fill the open spots, it
would require 12 months of work and too many hospitals would be
interested. If CMS has the tools to help one rural hospital, they
should use those tools.
Why do you think there is agency resistance to utilizing the Rural
Community Hospital Demonstration program?
Answer. I could only speculate, and I will not do so without at
least collecting additional information.
Question. We know that hemorrhages are a major underlying cause of
pregnancy-related deaths. Better prenatal care, telehealth, remote
monitoring, training for rural emergency rooms, and novel medical
devices can all play an important role in preventing maternal deaths.
What community-driven actions are important to ensuring women have
access to maternal health care when a local hospital closes its labor
and delivery unit?
Are there Federal regulations or administrative burdens that drive
up costs for rural providers? If so, what are they?
Answer. I do not have an immediate answer to this question, as our
Center and Panel have not addressed this issue directly. I would be
happy to investigate the subject matter, given time for a literature
review and consultation with colleagues who are subject matter experts
on this topic.
Question. I often hear how hard it is for rural hospitals to keep
up with prior authorization requests from insurance companies. Some of
this additional burden is driven by the growth of Medicare Advantage in
rural counties. While I am a supporter of the competition that Medicare
Advantage offers, we must aggressively hold these plans accountable. In
January 2024, CMS finalized regulations that establish prior
authorization timeliness requirements for Medicare Advantage. CMS
estimates that the current annual cost of prior authorization paperwork
for an individual physician is $54,642 per year. CMS estimates when
this regulation goes into effect in 2026 that those costs will be
reduced by $21,026, or 38 percent.
Will the administrative burden be 38 percent less because of these
new regulations?
Are there current insurance companies or payers more willing to
adopt administrative simplifications? If so, who are they and what have
they been able to simplify?
Answer. I have no reason to question the CMS estimate, so my answer
to the first question is ``yes.'' RUPRI's research on insurance markets
has not included investigating the second question, so I do not have a
direct answer. However, similar to an earlier response, I can say there
is a great deal of variation in contracts across health plans and over
time. Therefore, I would not be surprised to learn of instances where
the negotiated payment contract between plans and providers includes
administrative simplification. We need to collect evidence directly
from either the providers or the plans.
Question. CMS has over 2,000 quality metrics in its inventory that
health-care providers submit data for. In 2005, the Finance Committee
held a hearing on quality metrics in Medicare. I said at the time, we
did not want to overburden providers with reporting requirements and it
is important to develop quality measures by consensus.
Should CMS go on a quality metrics diet? What quality measures do
patients care about and which ones should be kept to best capture
outcomes in health care?
Answer. CMS has a process to retire quality measures; I reviewed
some of those during my time on an advisory committee created and
staffed by NQF; I assume that is continuing through the CMS contract
with Battelle. I suggest a conversation with CMS/Battelle to see how
the process for retiring measures is progressing. A process is in place
for considering new measures and, in my experience chairing NQF's rural
health workgroup, that process includes considering administrative
burden. The best way of doing so is to develop measures based on data
already being collected that can be pulled for this purpose. I agree
that those processes should result in the number of measures being both
meaningful for rural providers and not burdensome to administer.
As stated in another answer, an important step to reduce provider
burden is to align measures used by CMS/Medicare with those used by
private health plans and Medicaid plans. To the greatest extent
possible, the metrics should be measured using data already collected
in patient records or billing claims.
Question. Rural communities and hospitals are facing an ever-
growing challenge of staffing ambulances for emergency and transport
services. I am aware that CMS is conducting a multiyear data collection
of ground ambulance services.
Are there successful rural models to sustain ambulatory services?
If so, what makes them sustainable?
Answer. I am not aware of studies of rural-based ambulance services
that have taken actions that make them sustainable going forward.
However, there have been efforts to do so which are not yet tested with
longitudinal analysis: using ambulance staff, particularly paramedics,
in other health-related roles in their communities to create full-time
jobs with livable wages; and regional EMS network development that
realizes maximum efficiencies. The RUPRI Health Panel, in work
supported by the Helmsley Charitable Trust, has offered these policy
recommendations at the Federal level:
Pay ambulance fixed and standby costs--adjust the ambulance
fee schedule to reflect their role as health-care providers and
continue the add-on payments until the fee schedule is adjusted
to reflect total costs.
Acquire ambulance agency workforce and other data to better
understand needs and projections.
Apply Occupational Safety and Health Administration
guidelines to public sector employees, ambulance service
equipment, and workplace processes.
Support ambulance agency volunteers with continuing
education, health insurance, and workers' compensation
coverage.
Test new ambulance agency workforce models.
Require annual reports from the Federal Interagency
Committee on EMS (FICEMS).
Expand the FICEMS to other departments with resources to
support rural ambulance agencies.
The FICEMS could use data from the Medicare Ground Ambulance
Data Collection System to design and recommend ambulance
quality improvement strategies.
The Panel also made recommendations for State policy
considerations:
Designate EMS as an essential service and provide a portion
of the funding necessary to support costs of maintaining
essential service.
State EMS advocacy organizations should promote, and support
with educational grants, professional EMS management
certification low-volume ambulance agency directors.
State-based EMS regulatory boards should create (or modify
existing) EMS zones to comprehensively include rural areas.
State legislatures should preferentially direct ambulance
agency funding to cover standby costs and support EMS
coordination with EMS zones.
sources
(1) Characteristics and Challenges of Rural Ambulance Agencies--A
Brief Review and Policy Considerations. 2021. https://rupri.org/wp-
content/uploads/Characteristics-and-Challenges-of-Rural-Ambulance-
Agencies-January-2021.pdf.
(2) State-Based Recommendations to Support Rural Ambulance
Agencies. 2023. https://rupri.org/wp-content/uploads/State-Based-
Ambulance-2023.pdf.
Question. My bipartisan Healthy Moms and Babies Act includes a
provision to establish a national expert group to evaluate the
maternity care workforce's training practices. It also requires a study
of the role of doula services and community health workers to help
achieve better rural maternal and infant health outcomes.
What do we know about the role of doulas and community health
workers in maternal health care? What can we do to improve access to
these services?
Answer. I consulted with a colleague in the Carver College of
Medicine at the University of Iowa who is active in the State and
nationally in supporting maternal health care (Lastascia Coleman, CNM,
ARNP, MSN, FACNM), and she offered these responses:
1. Doulas and community health workers provide essential services
and support for patients, with deep knowledge of the resources and
strengths found in communities.
2. Doulas and CHWs that are integrated into the current public
health and health-care system have strong evidence showing they make a
positive difference and improve outcomes for mothers and babies. This
includes decreasing cesarean rates, higher rates of successful
breastfeeding and improving detection of mental health conditions like
postpartum depression.
3. Consideration should be given to how these services can also be
delivered via telehealth as this improves access and may be preferable
to this generation of mothers.
Question. In your written testimony you mentioned the number of
rural health clinics and Critical Access Hospitals participating in
Accountable Care Organizations. You noted that in some instances rural
providers have found a positive impact on their revenue.
Which rural providers have seen this positive impact? Are there
certain factors that have contributed to this success?
Answer. RUPRI Center research has shown an association between
Medicare Shared Savings Program (MSSP) participation and increases in
patient revenue, Medicare revenue, inpatient revenue share, and
Medicare revenue share, as well as a reduction in allowance and
discount rate (Health Services Research 58(1), 2023). Earlier work
published by the center explored variables associated with rural ACO
transition to two-sided risk SSP (Journal of Rural Health 39 (1) 302-
308), finding that ACO size, affiliation of supporting organizations,
and performance were positively associated with the transition. Our
earliest work investigating factors associated with rural ACO success,
measured as performance in shared savings and quality metrics, found
these to be related:
Prior collaboration experience.
Volume-to-value transformation strategic focus.
Clinician championship.
Care coordination services.
Data access and analysis.
Fully implemented electronic health record systems.
Medical homes for patients.
Previous risk experience such as HMOs or PPOs, or capitated
or bundled payment contracts.
______
Questions Submitted by Hon. John Thune
Question. As you know, in many rural communities pharmacies are
often the only place to access health-care services. You have done
research on the difficulties rural pharmacies face, despite being a
vital, trusted and accessible point of care for so many members of
rural communities.
I have introduced a bill with Senator Warner--the Equitable
Community Access to Pharmacist Services Act (ECAPS)--which would
provide coverage under Medicare Part B for some services related to
testing, treatment and vaccination for several common illnesses where
State scope of practice laws allow pharmacists to deliver such
services.
Along with providing access to vital services for vulnerable
seniors, this would also provide another revenue stream to help keep
rural pharmacies viable.
Do you think this type of policy could help improve access to
health care in rural communities?
Answer. Yes. RUPRI Center work during the recent public health
emergency examined the role of rural independent pharmacies in
providing vaccines, demonstrating that in many States the only way to
reach rural residents through established patterns of accessing
medications was to contract with local independent pharmacies (RUPRI
Policy Brief released February 2021: https://rupri.public-
health.uiowa.edu/publications/policybriefs/2020/
COVID%20Pharmacy%20Brief.
pdf). Further, as I said during the hearing, pharmacists are necessary
members of any comprehensive health team. Their roles are expansive, as
you state in the preamble to your question.
Question. In your testimony you cite the challenges recent nursing
homes closures have created in the availability of services for the
aging population in rural communities.
This is acutely problematic for States like South Dakota where the
next available nursing home bed could be hundreds of miles away from
home and away from friends and family.
CMS's final rule mandating minimum staffing standards for long-term
care facilities puts onerous and unworkable staffing mandates on our
Nation's nursing homes that would exacerbate this problem and
undoubtedly force more facilities to close their doors.
In light of the current health care workforce shortage in rural
areas, how would CMS's one-size-fits all mandate impact facilities'
ability to provide services?
Answer. I would like to provide a full context to my answer, so I
am using the same text I used to respond to an earlier question on this
issue. A quick response is that a more nuanced approach to assuring
high-quality care in our nursing homes, which recognizes the
complementary nature of tasks performed by different levels of trained
workforce, could be more sensitive to special circumstances in rural
places. Further, I am not prepared to state with certainty the impact
of the new rule, especially given the timelines to meet standards and
exemptions. The discussion during the hearing was instructive as to
possibilities.
To preface my answer, there is a need to expand the total pool of
labor across all health professions, including nursing at all levels.
This means considerations for hiring foreign-trained professionals,
training more local workforce, and engaging all institutions
(hospitals, nursing homes, clinics). Given that reality, if any one
group of providers (nursing homes) succeeds in recruiting large numbers
of nurses, another (hospitals) may not be able to meet their needs.
There are many variables in play that make projections risky: the
staffing requirement is phased in, with extended time for all nursing
homes, 3 years in urban areas and 5 in rural areas. The rule creates an
exemption for nursing homes in shortage areas that are unable to
recruit additional staffing. As was at least inferred during the
hearing, even these adjustments may not be sufficient to address rural
needs. The RUPRI Panel recommended CMS consider even longer timelines,
especially given the realty that near 80 percent of all nursing homes
could not currently meet the new ratios.
While the new standards may pose hardships for facilities, the goal
of improving quality in all nursing homes is laudable. Over time CMS
could move from a measure based on inputs such as staffing ratios, to
one based on outcomes independent of staffing arrangements.
Additionally, CMS could use existing programs to focus on assistance to
nursing homes by providing guidance and technical assistance.
Specifically, quality improvement organizations could be engaged
through their scope of work, and State surveyors could help identify
specific needs for improvement and technical assistance.
The Panel's comment letter on the proposed rule (https://rupri.org/
wp-content/uploads/RUPRI-Panel-Letter-re-Minimum-Staffing-Standards-
11.05.pdf) included these recommendations:
Increase base funding, and funding for training and
technical support for State surveyors, as well as better
coordination between State surveyors and the CMS-designated
Quality Innovation Network Quality Improvement Organizations.
Create a policy focus to increase the quantity and
composition of the staffing pool in a way that does not pull
resources from elsewhere, which could include decentralizing
training programs into rural environments, and pooling staff in
geographic regions.
CMS should implement, to the extent possible within
statutory constraints, other recommendations of the Committee
on the Quality of Care in Nursing Homes, National Academies of
Sciences.
CMS should consider including all nurse staffing categories
to deliver services available to and needed by underserved
areas, including use of licensed practice nurses, an especially
vital component of rural nursing home staffing.
Yes, there is at least some risk that enforcement of the standards
could lead to closure of rural nursing homes. The cost of meeting the
regulations could also result in changes in patterns of care, another
reason to use outcome measures.
______
Question Submitted by Hon. James Lankford
Question. It seems that financial incentives have overtaken care
quality incentives in the health-care sector, and this shows up even
more so in rural America, since actually there are much higher needs in
those communities, but decreased access to care.
This committee recently held a hearing on reforms to the physician
fee schedule to work toward more value-based payment models within the
Medicare physician fee schedule.
What are the most impactful changes we can make to better align our
health systems' financial incentives with our care quality incentives?
How did we get to this current level of crisis in rural health
care, and what active steps can Congress do to undo some of the damage?
Answer. A transformation from payment based solely on volume
(patient encounter regardless of need or outcome) to one incorporating
incentives linked to quality (value) is well underway. To answer your
first question, accelerating the pace of change to value-based payment,
but recognizing the need to be responsive to special rural
circumstances regarding covering fixed costs, is a path forward. The
Rural Health Value team has gathered information from rural innovators
that can be useful in designing policies, summarized in these two
documents:
Advancing Value-Based Payment Policies Relevant to Rural
Areas--Continued Challenges and New Opportunities. Rural Health
Value. 2023. https://ruralhealthvalue.public-health.uiowa.edu/
files/Advancing%20Rural%20VBP
.pdf.
How to Design Value-Based Care Models for Rural Participant
Success: A Summit Findings Report. Rural Health Value. https://
ruralhealthvalue.
public-health.uiowa.edu/files/
Rural%20VBC%20Summit%20Report.pdf.
The adjustments to traditional Medicare payment, as well as
incentives being implemented through Medicare Advantage, are quality
incentives adjusting payment within the structure of current payment
policies. There are also incentives for cost reduction (e.g., shared
savings). And there are financial incentives that combine both (e.g.,
MSSP). But the key questions include asking if current quality measures
are specific, measurable, actionable, relevant (especially for rural),
and timely. Furthermore, are incentives significant enough to lead to
improvement? In rural plans, do the measures not require high volumes
and does improvement require resources and experience that are readily
available?
______
Question Submitted by Hon. Robert P. Casey, Jr.
Question. The Medicare-Dependent Hospital designation and the Low-
Volume Hospital payment adjustment help maintain access to hospital
care in rural areas, including more than 20 hospitals serving rural
areas in Pennsylvania. Congress has traditionally reauthorized these
programs together for limited periods. The current authorization runs
through December 31, 2024, requiring Congress to enact another
extension this year. Given the last-minute timing of these extensions,
rural hospitals are not given time to adequately budget for the
continuation of this financial support. For years, Senator Grassley and
I have introduced the Rural Hospital Support Act to permanently extend
these programs, so that we can provide financial consistency and
stability for rural hospitals.
How would long-term certainty in these programs help rural
hospitals plan ahead to most effectively serve their communities?
Answer. A major concern in rural health is sustainability of the
services currently available in most rural communities. We cannot fully
address the future, which could include different payment policies and
different methods of delivering services, unless we have a continuous
platform from which to build. Therefore, long-term certainty in
programs designed to maintain adequate revenues is critical. The
security provided by that platform can facilitate a willingness to
innovate.
______
Question Submitted by Hon. Maggie Hassan
Question. Hospital consolidation has increased in recent years,
which can increase health-care costs for patients and limit patients'
choices in rural communities.
When a hospital system buys up all the medical facilities in a
community or even across many States, it often increases prices, which
can make it even more difficult for families to afford their health
care.
At the same time, we need to identify how to better support small
rural hospitals that operate on thin margins.
What can Congress do to support the financial viability of rural
hospitals? How do we balance support for rural facilities with
affordability for patients in those communities?
Answer. In the rural context, one reason for higher prices for some
services, as compared to urban prices, is the need to recover fixed
costs across a smaller total volume of services. This is the point made
in a recent article from RUPRI Center work, published in The Journal of
Rural Health (Barker AR, MacKinney AC, and McBride TD, Policy
implications of fixed-to-total-cost ratio variation across rural and
urban hospitals, 2023 The Journal of Rural Health 39(4) 737-745;
https://onlinelibrary.wiley.com/doi/epdf/10.1111/jrh.12767). Given that
reality, public payment policies designed to help assure continuous
access need to account for the higher fixed-cost ratio. Current
policies build that into the payment per service, which can affect the
deductibles paid by patients. To address that challenge, consideration
should be given to a two-tiered payment that accounts for the fixed
costs without building that cost into the calculations of beneficiary
deductibles. This would assure a stable source of revenue for the
hospital, enabling strategic planning to meet community needs.
______
Prepared Statement of Lori Rodefeld, MS, Director of GME Development,
Wisconsin Collaborative for Rural Graduate Medical Education (WCRGME),
Rural Wisconsin Health Cooperative
Chairman Wyden, Ranking Member Crapo, and members of the committee,
my name is Lori Rodefeld, and I serve as the director of GME
Development for the Wisconsin Collaborative for Rural Graduate Medical
Education (WCRGME), a program of the Rural Wisconsin Health
Cooperative. In addition to this role, I serve as the director of GME
Development for the Rural Residency Planning and Development (RRPD) and
Teaching Health Center Planning and Development (THCPD) Technical
Assistance Centers. I have been engaged in rural workforce development
for nearly 20 years working at a technical college, a rural hospital,
and now in support of growing the physician workforce not only in
Wisconsin but in rural communities across the country. Living in rural
Wisconsin, I see firsthand the shortages within our health-care system
and how it impacts access to care with fewer health-care professionals
available to fill critical positions.
The issues facing the rural health workforce are complex, and I
will not have time during my testimony to cover all issues and
potential solutions. My focus will be on the shortage of health-care
professionals in rural areas and how policy can help address this issue
leaning on my experience with rural physician workforce strategies.
To address the shortage of rural health-care professionals, action
must be taken including:
Foster the expansion of rural residency training through
policy that supports growth and sustainability for this
successful model of training.
Develop strategies that bolster expansion of rural training
for other health professionals including nurses, physician
assistants, pharmacists, dentists, medical assistants,
laboratory technicians, physical therapists, social workers,
and others.
Explore ways to amplify local and State level efforts to
innovate and develop programs to expand training that will
address shortages of health-care professionals through the
development of partnerships.
Workforce Is the Top Issue Facing Rural Health-care Organizations
Rural health care has long faced challenges in recruiting and
retaining qualified physicians and other health-care professionals.\1\
This isn't just an inconvenience--it threatens the fabric of health
care in rural communities. An aging workforce combined with a declining
younger populations to assume these positions could lead to a crisis
within rural health care. The hospitals and health-care facilities in
my State of Wisconsin are already stretched thin, serving patients
around the clock to meet their community's needs. Unlike other
industries, their hours can't be scaled back. Emergency rooms, trauma
centers, inpatient services, and labor and delivery units--these
critical services rely on a strong, stable workforce to keep the doors
open.
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\1\ Rural Health Research Gateway. Trends in Health Workforce
Supply in the Rural. U.S. https://www.ruralhealthresearch.org/projects/
926. Accessed May 12, 2024.
My testimony will not only include examples from Wisconsin, but
also a national perspective as we look to strategies that will address
rural workforce shortages. I'll work to highlight innovative approaches
as we explore ways to support not only rural physician training but
also the training of other health professionals. The extensive research
in rural medical education offers insights that can be applied across
health-care professions.
Rural Residency Training Provides a Successful Framework to Build Upon
To address the doctor shortage in rural areas, the answer is clear:
invest in rurally based GME training. It's a proven strategy that has
been in place for decades. Unfortunately the growth in rural training
has not kept pace with the growth of GME as a whole. It's estimated
that only 2 percent of residency training takes place in rural
communities \2\ despite nearly 20 percent of the population living in a
rural community.\3\
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\2\ U.S. Government Accountability Office: Physician Workforce.
https://www.gao.gov/assets/gao-17-411.pdf. Accessed April 20, 2024.
\3\ United States Census. Nation's Urban and Rural Populations
Shift Following 2020 Census. https://www.census.gov/newsroom/press-
releases/2022/urban-rural-populations.html#::text=
The%20rural%20population%20%E2%80%94%20the%20population%20in%20any,from%
2019.3%25%20in%202010%20to%2020.0%25%20in%202020. Accessed May 12, 2024.
A common misconception is that rural hospitals can't participate in
GME programs due to lack of interest, infrastructure, volume, or
experience, which simply isn't true. Efforts to grow rural residency
training have emerged not only in my home State of Wisconsin but across
the country. High quality training has developed in a number of
hospitals ranging from larger sole community hospitals with multiple
programs to smaller critical access hospitals hosting family medicine
residency programs to community health centers launching psychiatry
---------------------------------------------------------------------------
residency programs.
For years the State of Wisconsin was impacted by the closure of
five rural track programs (RTPs) which were launched as partnerships
between larger urban hospitals and rural hospitals. Working to overcome
this loss in the training of rural doctors, the State launched a GME
program development grant which served a catalyst for growth of new
programs. Hospitals were eligible to receive up to $750,000 in support
of planning and infrastructure development to host an accredited
residency program. One of the first hospitals to take advantage of this
funding was the SSM Monroe Hospital who launched the first new family
medicine residency in Wisconsin in nearly 2 decades. SSM Monroe has
seen success with nearly 50 percent of its graduates retained within
the health system, a majority of graduates practicing in rural and
underserved areas, and over 90 percent of the graduates have remaining
in the State of Wisconsin.
The success of the RRPD program is another example of the growing
interest by rural hospitals in creating new GME programs. Administered
by HRSA, within the U.S. Department of Health and Human Services, this
program offers crucial start-up funding and technical assistance to
launch GME programs within rural health facilities. Forty-six new rural
residency programs have achieved accreditation by the Accreditation
Council for Graduate Medical Education (ACGME). These programs
translate to a significant increase in physician training
opportunities, with 575 approved resident positions at full capacity.
This includes 441 positions in family medicine, 68 in psychiatry, 51 in
internal medicine, and 15 in general surgery.\4\
---------------------------------------------------------------------------
\4\ Rural Residency Planning and Development Technical Assistance
Center. https://www.
ruralgme.org. Accessed May 12, 2024.
Growing the Rural Physician Workforce Requires Both State- and
Federal-Level Support
The shortage of rural physicians has been an ongoing issue not only
in Wisconsin but across the country as stakeholders are taking action
to address these critical health disparities. There is a growing body
of evidence showing that training in rural places leads to practice in
rural places. Recent studies have demonstrate physicians who complete
at least half of their GME in rural areas are 5 times more likely to
practice in rural areas versus those without rural training.\5\
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\5\ Patterson DG, Shipman SA, Pollack SW, et al. Growing a rural
family physician workforce: The contributions of rural background and
rural place of residency training. Health Serv Res.
2024;59(1):e14168. doi: 10.1111/1475-096773.14168.
Interest by rural facilities in creating GME experiences continues
to grow. In Wisconsin, there are 27 rural programs which is an increase
from six rural programs in 2012. The State has over 30 established
rural rotations with continued interest by rural hospitals, clinics,
and health centers in serving as a rotation or GME site. There are
currently seven new GME programs under development in Wisconsin with
interest from additional sites. Additionally, the Rural Residency
Planning and Development (RRPD) Technical Assistance Center has
identified 145 GME-naive hospitals in rural communities with
characteristics and volumes similar to established teaching hospitals
that could be strong candidates for future development.\6\
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\6\ Adhikari M, Hawes E, Sanner L, Holmes GM. Characteristics of
Hospitals by Graduate Medical Education Expense Category: Implications
for Rural Residency Program Expansion. Acad Med. 2023 December 7th.
doi: 10.1097/ACM.0000000000005589. Epub ahead of print. PMID:
38060405.
The Consolidated Appropriations Act (CAA) of 2021 aimed to address
the critical shortage of rural physicians at the Federal level, with
three key sections related to rural GME. Under section 126, 10 percent
of new residency slots were to be allocated to rural hospitals and data
shows the majority of these slots were not distributed to
geographically rural hospitals.\7\, \8\ In Wisconsin,
Marshfield Clinic did not receive slots under section 126 for its
internal medicine residency program in the first two rounds of
distributions despite being geographically rural. Other rural hospitals
have not applied for slots because they do not have a Health
Professionals Shortage Area (HPSA) designation.
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\7\ Rains J, Holmes GM, Pathak S, Hawes EM. The Distribution of
Additional Residency Slots to Rural and Underserved Areas. JAMA. 2023
Sep 12;330(10):968-969. doi: 10.1001/jama.2023.
14452.
\8\ Rodefeld L, Adhikari M, Hawes EM. Overview of Residency
Programs Selected for CAA Sec. 126 Round Two Graduate Medical Education
Slots. https://www.ruralgme.org/wp-content/uploads/2023/12/CAA-Sec-126-
Round-Two-Analysis-Dec-2023.pdf. Accessed May 12, 2024.
Under section 127 of the CAA, a complex separate accreditation
requirement was removed allowing for the expansion of existing
accredited programs through a permanent complement increase and FTE cap
increase allowing for the creation of new rural positions.\9\ This
legislation has allowed hospitals interested in rural GME the
opportunity to create new positions with reduced startup costs and less
administrative expenses that can be associated with separate
accreditation. This has led to the creation of new rural residency
programs including two new programs at Creighton in psychiatry and
internal medicine \10\ as well as a psychiatry residency at West
Virginia University.\11\
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\9\ Hawes EM, Holmes M, Fraher EP, et al. New opportunities for
expanding rural graduate medical education to improve rural health
outcomes: Implications of the Consolidated Appropriations Act of 2021.
Acad Med. 2022;97(9):1259-1263.
\10\ CHI Health-Creighton University Partner to Combat Rural
Physician Shortage With First-of-Their-Kind Residency Programs. Midwest
Medical Education. https://www.midwest
medicaledition.com/articles/chi-health-creighton-university-partner-to-
combat-rural-physician-shortage-with-first-of-their-kind-residency-
programs. Accessed May 12, 2024.
\11\ West Virginia University. WVU plans rural psychiatry residency
training to help patients with limited access to care in North Central
W.Va. https://medicine.wvu.edu/News/Story?
headline=wvu-plans-rural-psychiatry-residency-training-to-help-
patients-with-limited-access-to-care-in-north-. Accessed May 12, 2024.
Section 131 of the CAA provided a one-time opportunity for certain
hospitals to reset their Medicare reimbursement rates for graduate
medical education.\9\ This was specifically aimed at hospitals with low
FTE (full-time equivalent) resident caps or Per Resident Amount (PRA)
figures. The time frame for this reset will expire on December 26,
---------------------------------------------------------------------------
2025.
Expanding rural rotations offers a promising strategy to strengthen
the rural physician workforce.\12\ This approach shifts residents'
training into rural sites providing diverse training experiences
outside of programs in larger communities. Additionally, rural
rotations are less resource-intensive making them a more accessible
entry point for building academic-rural partnerships while also
creating a solid foundation for future GME growth. Section 131 allows
for residents to rotate at rural hospitals for up to 1.0 FTE without
triggering a FTE cap.\9\
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\12\ Hawes EM, Rodefeld L, Weinstein DF. Academic Medicine and
Rural Health System Partnerships: Enhancing Education While Advancing
Physician Workforce Priorities. Acad Med. 2024 May 2. doi: 10.1097/
ACM.0000000000005753. Epub ahead of print. PMID: 38704825.
Wisconsin stands as a leader in supporting State-level GME growth,
particularly in rural communities. Collaboration between several key
stakeholders including the Wisconsin Hospital Association, Wisconsin
Council on Medical Education and Workforce, the Rural Wisconsin Health
Cooperative, medical schools, and existing GME programs, has allowed
for the creation of an ecosystem to train future rural physicians.
State-level GME funding has yielded impressive results. Hospitals
looking to develop new programs or expand existing programs have helped
support an increase of over 60 additional resident positions each year
\13\ and over 20 new programs in high need specialties including family
medicine, psychiatry, general surgery, and obstetrics and gynecology.
In the last legislative session, support for increased funding per slot
and removal of caps were approved with strong support. Both Medicare
and Medicaid funding combined with State appropriations have been
essential to grow our workforce.
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\13\ Wisconsin Hospital Association. WHA-Crafted GME New Program
Development Grants. https://www.wha.org/vv-physician-03-26-2024/2.
Accessed May 12, 2024.
Beyond Wisconsin, there are 44 other States developing strategies
to utilize Medicaid GME funding as an investment in physician
workforce.\14\ Some States are focused on growing or supporting
positions in rural or high need specialty areas. Medicaid GME allows
for States to address maldistribution of physicians by geography,
specialty, setting, or by responding to population growth.\15\
Approaches vary significantly with some States providing supplemental
funds, allocating additional GME slots, supporting planning and
development, or offering technical assistance. There is an opportunity
to create new learnings across States and share approaches as a way to
developing and sustaining residency programs that will meet our
population health needs.
---------------------------------------------------------------------------
\14\ Henderson T. Medicaid Graduate Medical Education Payments:
Results From the 2022 50-State Survey. 2023. https://store.aamc.org/
downloadable/download/sample/sample_id/590/.
\15\ Fraher, Erin P., Ph.D., MPP1; Rains, Jacob A., MPH2; Bacon,
Thomas J., DrPH3; Spero, Julie, MSPH4; Hawes, Emily, PharmD, BCPS,
CPP5. Lessons Learned From State-Based Efforts to Leverage Medicaid
Funds for Graduate Medical Education. Academic Medicine ():10.1097/
ACM.0000000000005678, February 27, 2024. | DOI: 10.1097/
ACM.0000000000005678.
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Opportunities to Bolster Training of Other Health Professionals
With the demonstrated success of expanding rural physician training
as a workforce strategy, there's an opportunity to apply these
learnings to other health professions. Evidence shows that one of the
factors most closely associated with health-care professionals choosing
to practice in a rural area is being raised in a rural area.\16\
Therefore, strategies to engage a pipeline of rural students and
providing rural experiences are vital to addressing rural workforce
shortages. In Wisconsin and other States, efforts are underway to
provide resources and support specifically for training other health
professionals. These initiatives range from State grants and funding to
collaborative partnerships which further develop our future rural
workforce.
---------------------------------------------------------------------------
\16\ Fritsma T, Henning-Smith C, Gauer JL, et al. Factors
Associated with Health Care Professionals' Choice to Practice in Rural
Minnesota. JAMA Network Open. 2023;6(5):e2310332. doi: https://doi.org/
10.1001/jamanetworkopen.2023.10332.
One such initiative is a Wisconsin State grant program launched in
2017.\17\ This program supports the development of training
opportunities for allied health professionals giving a preference for
those in rural areas. Hospitals and health-care facilities can receive
up to $125,000 in funding to support the expansion of training health-
care professionals in their facilities who provide direct patient care
and has supported education for a number of students including those
training to become behavioral health specialists, counselors,
laboratory technicians, and other critical health-care professions.
Since its implementation, this program has funded the establishment of
50 educational partnerships, allowing for a significant expansion of
clinical training sites, primarily in rural areas.
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\17\ Wisconsin Department of Health Services. Allied Health
Professional Education and Training Grant. https://
publicnotices.wisconsin.gov/NoticeView.asp?lnid=1537388. Accessed May
12, 2024.
This approach is echoed in Minnesota's innovative Medical Education
and Research Costs (MERC) program. Established in 1996, MERC uses
Medicaid funding to support training not just for physicians, but also
for other crucial health professionals in their State.\18\ The program
has continually adapted, expanding eligibility in 2013 to encompass
training programs for social workers, community health workers,
paramedics, dental therapists, and psychologists. Similarly, the State
of Washington is exploring using Medicaid funds to support training for
Advanced Practice Providers, aiming to increase the number of primary
care and behavioral health providers in rural and underserved
areas.\19\
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\18\ State of Minnesota. Medical Education and Research Costs.
https://www.health.state.
mn.us/facilities/ruralhealth/merc. Accessed May 12, 2024.
\19\ Washington State Healthcare Authority. Medicaid Funding
Options for Clinical Training Programs. https://www.hca.wa.gov/assets/
program/gme-funding-leg-report-20240129.pdf. Accessed May 12, 2024.
These efforts, coupled with initiatives that spark early interest
in health-care careers among rural youth, offer a promising path
towards a more robust rural health-care workforce. Attracting middle or
high school students, especially those in rural communities, is
essential. Many rural hospitals in Wisconsin have invested in programs
like ``club scrub,'' youth apprenticeships, and even a health careers
high school. The Rural Wisconsin Health Cooperative is developing an
interactive computer game to allow students to explore rural health
careers, increasing awareness and interest in the vast options
available.\20\
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\20\ Wisconsin Roads to Rural Health Careers. https://www.rwhc.com/
About-Us/RWHC-Healthy-Wisconsin/RWHC-Healthy-Wisconsin-Articles/Rural-
Roads-to-Health-Careers. Accessed May 12, 2024.
Wisconsin's technical colleges are playing a key role as well. One
example is the ``Need for Nurses'' program at Southwest Technical
College.\21\ Partnering with six rural hospitals, this program secured
funding to double its enrollment and offer nursing degrees in both fall
and spring semesters. The public-private partnership goes beyond
program costs; it's an investment in student success, promoting
continuous enrollment, retention, and completion.
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\21\ Southwest WI Technical College. Ribbon cuttings mark unique
health-care partnerships. https://www.swtc.edu/news/press-releases/
ribbon-cuttings-mark-unique-healthcare-partnerships. Accessed May 12,
2024.
Recruitment of Medical Assistants (MAs) in Wisconsin is an issue
not only for rural hospitals but also rural health centers. Recognizing
that training can occur in an academic institution or through an
apprenticeship model, community health centers have worked to develop
their own training program providing virtual instruction shared amongst
health centers with hands-on learning occurring at local centers.\22\
This centralized model allows for leveraging of shared resources while
giving students an opportunity to ``earn while they learn.'' MA
positions are unique as they allow for further career growth as they
can later pursue other health careers including nursing, pharmacy, or
medicine.\22\
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\22\ Wisconsin Primary Health Care Association. Community Health
Center Workforce. https://www.wphca.org/wp-content/uploads/2022/08/
Wisconsin-Community-Health-Center-Workforce-Issue-Brief-August-
2022.pdf. Accessed May 12, 2024.
Finally, I would like to highlight an example of rural innovation
at Gundersen's Hillsboro Hospital. They recognized the critical need
for mental health services in their local schools and established a
partnership with a nearby college to create a solution by bringing
social work (LCSW) students into their local schools.\23\ These
students gain invaluable clinical experience working directly in the
schools allowing students to fulfill their licensure requirements while
also providing much-needed mental health care to students, fostering a
healthier learning environment.
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\23\ Rural school district, Gundersen join to provide mental health
resources to students. https://www.news8000.com/news/local-news/rural-
school-district-gundersen-join-to-provide-mental-health-resources-to-
students/article_b2c9c884-37b8-5fc4-914b-72b74711665a.html. Accessed
May 12, 2024.
Despite Progress Made to Grow Rural Workforce, Challenges Remain
Despite Federal and State efforts to increase the number of
residency positions, significant challenges remain for rural hospitals
looking to develop or sustain rural residency programs. Primary
challenges include the cost to develop a program, Medicare funding
complexities, varied definitions of rural, limited timeline to reset a
FTE cap or PRA, and financial uncertainty for the Teaching Health
Center Graduate Medical Education (THCGME) program.
Financing to support and sustain a residency program can serve as a
barrier to expanding GME in rural areas. For hospitals looking to
launch a new program, the initial investment can be substantial. The
cost to develop a residency program in a rural hospital has not been
studied extensively; however, new programs in Wisconsin are seeing
financial estimates of over $2 million to launch a smaller size six-
resident family medicine residency program. Federal grant support like
the RRPD program or State grants like those developed in Wisconsin can
help offset the initial up-front costs in launching a new GME program.
As programs develop, there are challenges associated with starting
a program which include funding inequities based on hospital type.
Certain rural hospital payment methodologies do not result in full
Medicare GME funding for Sole Community Hospitals (SCHs) and Medicare
Dependent Hospitals (MDHs). Financial projections estimate reductions
in indirect medical education (IME) payments based on Medicare
Advantage utilization. Allowing full IME payments for these hospitals
or treating SCHs or MDHs as nonhospital sites in a manner similar to
the payment models for Critical Access Hospitals could be potential
policy solutions.
While the Consolidated Appropriations Act has included provisions
in support of rural GME expansion, there are opportunities to further
support rural hospitals. The FTE Cap and/or PRA reset deadline under
section 131 will sunset in December 2025. While some hospitals have
utilized this opportunity, others have struggled with accreditation
and/or necessary program partnerships to take on training of residents
in order to reset low FTEs and PRAs. A policy solution could include an
extension of the deadline for FTE Cap and/or PRA resets allow
additional time for impacted hospitals. Policy could also be considered
to broaden the ability of rural programs to grow further by allowing a
hospital in a geographically rural area with less than 12 FTEs to reset
a FTE cap or PRA at any time which would allow for more substantial
growth beyond the additional slots offered through section 126.
Current limitations on the definition of ``rural'' are hindering
the growth of GME programs in Wisconsin and across the country. The
Centers for Medicare and Medicaid Services (CMS) use a metropolitan or
nonmetropolitan county designation to authorize payment for funding of
GME programs. An alternative may be to consider using the Federal
Office of Rural Health Policy (FORHP) definition which looks at
additional variables like census tracts in addition to non-metropolitan
areas. The CMS definition has excluded hospitals in Wisconsin which
meet the FORHP definition from participating in Rural Track Programs
(RTPs). Transitioning to a new definition would broaden the pool of
hospitals eligible to create RTPs especially in western States with
geographically large counties. This would benefit not only urban
residency programs eager to partner with rural hospitals but also rural
hospitals interested in developing GME programs who are currently
ineligible due to CMS's stricter definition.
HRSA administers programs to provide funding to support education
in rural and underserved settings. The THCGME program supports 81
residency programs which include 30 percent who train residents in
rural communities. The THCPD program supports the startup of 93 new
THCGME programs expanding this reach even further.\24\ One example of a
THCPD program making an impact is the Marshall University Consortium
Rural Psychiatry Program which recently received ACGME approval and has
already recruited 4 residents to join the program this year. The
program will provide psychiatry services to a rural county in West
Virginia that currently has no psychiatrists. Marshall faculty are
filling this void and providing access to a community that desperately
is in need of psychiatrists. There is not a current THCGME funding
opportunity for THCPD grantees who are committed to training doctors
and dentists in rural and underserved areas.
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\24\ Health Services Resources Administration. Teaching Health
Center Graduate Medical Education Program. https://bhw.hrsa.gov/
funding/apply-grant/teaching-health-center-graduate-medical-education.
Accessed May 12, 2024.
To impact health workforce, grants and support for development of
local or State level clinical training infrastructure through technical
assistance could help rural health-care entities expand their training
capabilities. Building on the success of other technical assistance
center models, consideration could be given to develop assistance for
States looking to further develop their own strategies utilizing
public-private partnerships or Medicaid GME support to further build
their workforce in rural communities and shortage areas. An
organization working to support identification of best practices and
innovations would ensure rural health pipeline successes are shared and
can be replicated. State-based efforts have proven to be an effective
strategy through bringing together key stakeholders to identify
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specific workforce needs in a responsive manner.
Although State-level efforts can make an impact, Federal funding
models should be explored to help rural communities expand clinical
training in a variety of health professions with career pathway models
to support progression within health professions. Additionally, support
for rural middle and high school students in career pathways and skill
development is critical as a strategy to build our future rural health
workforce. Resources are needed to help build infrastructure, develop
partnerships, and support training site development.
Conclusion
Thank you, Chairman Wyden, Ranking Member Crapo, and members of the
Senate Committee on Finance, for the opportunity to testify today
regarding rural health workforce. The future of rural health care
depends on our ability to cultivate a strong workforce. It is an honor
to share the successes we have seen in Wisconsin and across the Nation
in supporting rural residency development as a framework to further
promote rural health careers across all health professions. With
continued investment and policy development, we can work to build a
pipeline of talented health-care professionals who are interested and
prepared to serve in rural communities. Federal policy can serve as a
catalyst for building upon the work already underway in support of
rural health care.
______
Questions Submitted for the Record to Lori Rodefeld, MS
Questions Submitted by Hon. Mike Crapo
Question. The shortage of primary and specialty care providers is a
critical issue facing rural communities across the country. Difficulty
recruiting and retaining physicians and other members of the care team
can result in longer patient wait times and reduced access to care.
What concrete policy ideas would you suggest this committee pursue
to help attract more providers to rural America?
Answer. There are many strategies that could make an impact on
rural physician recruitment and retention. Here are some targeted
policy changes that could be implemented by the Senate Finance
Committee to address this issue:
Broaden Definition of Rural to Foster GME Expansion: Update CMS
funding eligibility criteria to encompass all geographically defined
``rural'' areas designated by the Federal Office of Rural Health Policy
(FORHP), regardless of metropolitan status which is currently the
mechanism used by CMS. This change could unlock GME funding for several
hospitals who are currently unable to participate in rural track
programs. In Wisconsin, there are at least two critical access
hospitals interested in GME that are located in metropolitan counties
yet are designated as rural by FORHP making them ineligible for
traditional Medicare funding as a rural track program.
Incentivize Rural Rotations: Develop policies that support academic
medical centers and residency programs to offer rotations in rural
settings. Recent changes allow critical access hospitals and rural
emergency hospital to be treated as non-provider settings when
residents rotate in these facilities. Implementing a similar strategy
for other hospital types would allow residents to more easily train in
any rural setting thereby leading to growth in the number of residents
being exposed to rural practice. This could have a significant impact
on rural workforce as evidence shows at least 2 months of rural
training can influence eventual rural practice by up to 45 percent.\1\
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\1\ Bowman RC, Penrod JD. Family practice residency programs and
the graduation of rural family physicians. Fam Med. 1998;30(4):288-292.
Strengthen Financial Incentives for Rural Practice: The existing
HPSA bonus payment program provides a valuable financial incentive for
physicians practicing in underserved areas. Financial incentives like
this can have a significant role in both physician recruitment and
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retention in rural areas.
According to the WWAMI Rural Health Research Center, there are
approximately 169 rural residency programs operating through the Rural
Residency Planning and Development Program. Yet there is still very
little rural training happening. Only 3 to 4 percent of family medicine
residents attend a rural residency. Fewer than 10 percent of family
medicine residents do any rural training.
Question. How do we shift from focusing on the total number of GME
slot allocations to addressing the maldistribution of trainees that
impedes a rural community's ability to recruit and retain providers?
How does Wisconsin leverage other sources of Federal funds, such as
Medicaid GME, to creatively support rural workforce program
development?
Answer. Increasing the number of residents training in rural
communities requires a multipronged investment at the State and Federal
level. In Wisconsin, we've successfully used a strategy that
incentivizes not only expansion of GME positions through State grant
programs but also the establishment of new programs and growth of rural
rotation experiences. This approach, with commitment from key
stakeholders and technical assistance support, can be replicated in
other States.
The Wisconsin Collaborative for Rural GME has supported the growth
of rural residency programs from 6 in 2012 to 27 in 2024. We also have
over 30 rural hospitals offering rotations to residents in high-need
specialties, and the majority of primary care residency programs offer
rural training experiences.
Beyond simply allocating new slots to rural hospitals, a key
strategy is to replicate successful State-level infrastructure
development. States like Arizona, New Mexico, and Missouri are
utilizing Medicaid GME funding to support expansion, program
development, and offer technical assistance. At the State level,
investments can be targeted to high-need specialties or regions where
there are more significant physician shortages. Additionally, some
States leverage this funding to grow their nonphysician workforce.
Growing this type of infrastructure requires sharing of successful
strategies and best practices. A national technical assistance center
offering State-level workforce development support for GME and other
health professions could have a significant impact on increasing the
workforce practicing in rural areas.
Question. Wisconsin Collaborative for Rural Graduate Medical
Education was established using State funds in 2012. WCRGME's work to
design, launch, and operate innovative workforce initiatives
strengthening Wisconsin's rural workforce is impressive. These efforts
led to the development of the first rural obstetrics and gynecology
residency program in the Nation.
How did this State investment allow for growth in both the total
number of GME residency positions, rural GME sites, and rural residency
rotations?
What lessons can this committee learn from your success in
developing more diverse and sustainable rural health-care workforce
training options?
Answer. Thank you for recognizing the Wisconsin Collaborative for
Rural Graduate Medical Education's (WCRGME) efforts. Our success is a
testament to the combined power of strategic investment, collaboration,
and a commitment to building a sustainable rural health-care workforce.
When Wisconsin embarked on this journey in 2010, we faced a
significant challenge: the loss of five rural residency programs due to
financial constraints and lack of support. Through a comprehensive,
State-funded GME strategy, we've achieved significant growth.\2\
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\2\ Bruksch-Meck, K, Crouse, B, Quinn, G, McCart, L, Traxler, K.
Graduate Medical Education Initiatives to Develop the Physician
Workforce in Rural Wisconsin. WI Med Society Journal. https://
wmjonline.org/wp-content/uploads/2018/117/5/201.pdf. Accessed June 5,
2024.
As you've noted, we have expanded residency opportunities not only
in primary care but also in high-need specialties like obstetrics/
gynecology (OB/GYN), psychiatry, and general surgery. Supporting these
programs through grant funding has been crucial. Inconsistent patient
volumes and limited faculty in rural settings can make establishing
these residencies difficult. State funding helps bridge this gap by
supporting GME expansion slots which creates a pathway for rural
program sustainability.\3\
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\3\ State of WI. GME Expansion Grants. https://
publicnotices.wisconsin.gov/NoticeView.asp?
lnid=1537444. Accessed June 5, 2024.
Our approach has been inclusive, offering funding for a variety of
specialties, from family medicine to internal medicine and pediatrics
and others. Stakeholders and workforce reports \4\ have had an impact
on the funding for GME expansion to ensure growth in communities and
specialties that most need physicians. By offering flexible options
through early exploration and rural rotation grants,\5\ we have
empowered residencies and hospitals to tailor their GME efforts to
their unique strengths and needs, ensuring growth in the communities
and specialties facing physician shortages.
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\4\ WI Council on Medical Education and Workforce. Reports. https:/
/www.wcmew.org/reports. Accessed June 5, 2024.
\5\ Wisconsin Rural Physician Residency Assistance Program. Funding
Opportunities. https://www.fammed.wisc.edu/rural/funding-opportunities.
Accessed June 5, 2024.
Developing GME programs takes time and patience. While Wisconsin
started its strategy in 2010, we're just starting to see a more
significant return on investment. We have over 70 percent of residents
who train in our State remaining here to practice, with a majority
serving in rural communities.\6\
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\6\ WI Hospital Association. GME Expansion Grants. https://
www.wha.org/MediaRoom/WHANewsletter/2021/08-19-2021/Reminder-
Applications-for-GME-Residency-Expansion. Accessed June 5, 2024.
Our experience underscores that rural hospitals are eager to
participate in GME but need support. A strategic investment in growing
GME is necessary to support not only primary care but high need
specialties through targeted funding. As efforts are launched at the
State and national level, an inclusive approach must be used to build a
well-rounded rural workforce. Identifying and supporting high need
specialties in addition to primary care can have a significant impact
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on rural health.
Question. The Consolidated Appropriations Act of 2021 added 1,000
new
Medicare-funded GME residency training slots. This was the largest
increase in Medicare GME slots in over 25 years. A minimum threshold of
10 percent of these new residency positions were set aside to help more
residents get experience practicing in rural settings. Despite the law
requiring a floor on the number of expanded residency slots allocated
to rural hospitals, only 6 percent of those slots went to hospitals
geographically located in a rural area. CMS distributed another 42
percent to urban hospitals that have reclassified as rural for certain
payment purposes. According to CMS, the agency received applications
from a total of 13 geographically rural hospitals, but only seven of
them were awarded slots. CMS says they have worked with the Health
Resources and Services Administration's Office of Rural Health Policy
to educate eligible rural entities about the application process.
Why do you think that rural entities are not applying for the newly
funded Medicare GME slots?
Answer. Rural hospitals are interested in expanding residency
programs; however, current policy limits their eligibility and
participation. Several hospitals located in geographically rural
communities with adequate faculty and strong patient volumes are not
eligible due to not being located in a Health Professional Shortage
Area (HPSA).
Legislation has also allowed hospitals ``treated as rural'' to
qualify for slots designated for rural communities. Several of these
hospitals have higher HPSA scores which has impacted rural hospitals
that did apply for slots in the first two rounds like Marshfield Clinic
in Wisconsin. Other rural hospitals have chosen not to apply as they
are not located in a HPSA and are unlikely to receive slots based on
the current methodology.
To address this issue in future distribution rounds, consider
removing any requirements that a hospital be located in a HPSA and
expand to a more precise definition of rural like the one used by the
Federal Office of Rural Health Policy (FORHP). These changes would
foster increased participation by eligible rural hospitals with less
restrictions and more rural hospital applicants who are eligible.
Question. Workforce shortages are exceedingly persistent and
challenging to fix. Since 1965, the Federal Government has incentivized
physicians to practice in high-need areas of the country through the
Health Professional Shortage Areas (HPSA) designation. Despite being in
place for almost 60 years, and appropriating billions of discretionary
and mandatory dollars each year, recent research has found limited
evidence of the HPSA program's effectiveness at reducing geographic
disparities in both access to care and health outcomes. Fundamental
improvements may be needed in order for this program to achieve
intended results.
While the supply of primary care physicians per 100,000 population
in rural versus urban counties has remained virtually the same over the
past 25 years, it is encouraging to see that the nurse practitioner and
physician assistant provider supply is growing. What changes should
Congress consider to modernize current Federal programs to better
reflect current rural health provider practice location patterns?
Answer. While it's encouraging to see the growing supply of nurse
practitioners and physician assistants in rural areas, stagnant primary
care physician growth does demonstrate the need to grow new programs
and approaches that will influence practice location patterns. States
like Wisconsin have pioneered successful programs to expand training of
physician assistants and nurse practitioners. These programs
demonstrate the importance of investing in high-quality rural
educational experiences for APCs through partnerships, faculty
development, and infrastructure support.
To further strengthen the rural nonphysician workforce, efforts
should be made to create programs like the Advanced Practice Clinician
(APC) Expansion Grant \7\ in Wisconsin to support planning and
implementing of rural training experiences. This program not only
supports the costs associated with launching a program but also tuition
for students training in rural settings. At SSM Monroe Hospital, a
grant successfully led to an increase of 30 percent in APC student
rotation experiences, enhanced faculty development, curriculum
development, and engagement of APCs, and the increased recruitment of
students into APC roles after completion of training.
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\7\ WI Department of Health Services. APC Expansion Grant. https://
www.dhs.wisconsin.gov/primarycare/apc-grant.htm. Accessed June 5, 2024.
Support for growing initiatives like this could can help build upon
the success of rural physician training models to grow rural workforce
for other health professions. This could be done through Federal grants
or the establishment of a technical assistance center that fosters
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collaboration and knowledge sharing of successful State models.
______
Questions Submitted by Hon. Chuck Grassley
Question. Thank you for answering my questions about how the
Centers for Medicare and Medicaid Services (CMS) are currently
distributing 1,200 additional graduate medical education slots. As I
stated at the hearing, I wrote to CMS last year on their efforts to
implement these additional GME slots to rural and underserved areas. I
also asked CMS about the reforms Congress made to the rural training
track program. The agency claimed it takes years for programs to ramp
up.
What meaningful data should Congress be looking for to determine if
changes to the rural training track program have been effective?
Answer. Absolutely, evaluating the effectiveness of changes to the
Rural Training Track Program (RTP) requires a multi-faceted approach
that considers both program development timelines and long-term
outcomes.
As you mentioned, developing residency programs, especially in
rural areas, can be a lengthy process due to accreditation, faculty
recruitment, financial considerations, and participation in the
National Resident Matching Program (NRMP) match to recruit residents.
On average it takes 3-5 years to launch a rural program, sometimes
longer depending on partnerships and recruitment of key staff including
program directors. With this in mind, focusing solely on the number of
newly launched programs might not provide a complete picture.
In considering effectiveness, I would recommend looking at the
total number of programs, trainees, and graduate practice locations.
While acknowledging the time frame for development, tracking the number
of new and expanded programs demonstrates program growth and potential
future impact as it relates to rural physician workforce. It may also
be worthwhile to monitor the total number of residents training in RTPs
as this reflects both new programs developed and positions expanded
over time. Finally and more significantly, tracking the practice
location of graduates, particularly those practicing in rural areas, is
an important metric of program effectiveness.
Development of mechanisms to track these metrics could help
showcase how rural programs are contributing to the physician workforce
while also identifying any significant challenges or opportunities.
Supporting an organization or entity in gathering this type of data
could inform future rural GME policy updates related to funding, slot
allocations, or broader Graduate Medical Education (GME) innovations.
Question. In my 99-county tour of Iowa, I frequently hear about the
workforce shortages in health care. Some rural hospitals have
established community-led strategies to address their workforce needs.
This includes proactive engagement with middle and high school
students, supporting or developing a pipeline of health-care
professionals with a local college, professional school training
opportunities, and a robust recruitment strategy.
What should a comprehensive workforce strategy look like for a
rural hospital? If possible, please provide leading examples of rural
hospitals deploying a successful community-led strategy.
Answer. A comprehensive workforce strategy for a rural hospital
should focus on building a pipeline of talent through community-led
initiatives. We know that health-care professionals who train in rural
settings are more likely to practice rurally.\8\ With this in mind,
rural health-care facilities are working to grow additional experiences
for health-care professional students. Key elements of a successful
strategy include grow your own initiatives, growth of health
professionals training, creation of new medical education expansion,
and early exploration opportunities.
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\8\ Fritsma T, Henning-Smith C, Gauer JL, et al. Factors Associated
with Health Care Professionals' Choice to Practice in Rural Minnesota.
JAMA Network Open. 2023;6(5):e2310332. doi: 10:1001/
jamanetworkopen.2023.10032.
Here is are some highlights from a couple of rural Wisconsin
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hospitals successfully leading the way:
Grow-Your-Own Programs: Partnerships with local schools to expose
students to health-care careers by offering training within a rural
hospital. One model is the Tamarack Health partnership with Hayward
High School to offer nursing assistant training at their critical
access hospital.\9\
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\9\ WI Health News. WI Leaders Share Strategies to Meet Workforce
Demands. https://wisconsinhealthnews.com/2024/06/04/hospital-leaders-
share-strategies-to-meet-workforce-demands. June 4, 2024.
Health Professionals Training: Prairie Ridge Health is a critical
access hospital offering robust clinical training to students including
laboratory technician, medical imaging, nursing, surgical technician,
and others. Recognizing this significant need, the team has implemented
new partnerships and learning opportunities in their facilities with
the support of State grant funding.\10\
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\10\ Prairie Ridge Health. Building Tomorrow's Workforce Today.
https://www.prairieridge.
health/en/education. Accessed June 5, 2024.
Medical Education Expansion: Rural hospitals are increasingly
becoming partners in training of medical providers training both
students and resident physicians. Tamarack Health in Ashland has long
been a site for resident rotations for psychiatry and family medicine
residency programs in addition to medical students. They recently
launched an emergency medicine fellowship and have plans to develop a
family medicine residency in partnership at the critical access
hospitals in Hayward and Ashland with the support of a State GME
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program development grant.\9\
Early Exploration: Several rural hospitals have created programs to
expose middle and high school students to health careers. One example
of this is Prairie Ridge Health which offers a ``Club Scrub'' program
for middle school students \10\ which showcases the variety of health-
care career options with hands on activities.
______
Questions Submitted by Hon. Maria Cantwell
Question. Researchers expect that the Nation will face a shortage
of over 80,000 physicians by 2035. Rural communities are already having
an especially difficult time finding enough health-care workers.
Currently, only 11.4 percent of the Nation's doctors practice in rural
areas, even though 20 percent of the population lives in rural areas.
Even in rural communities that do have enough staff, the physician
workforce is aging and there are not enough doctors in the pipeline to
take over for retiring doctors.
In rural Ferry County in northeast Washington, over 70 percent of
physicians providing direct care to patients are 55 or older. When
these physicians move on to retirement, we will not have enough new
staff set up to replace them.
Rural locations may have a harder time recruiting and retaining
health workers for a variety of reasons, including inability to compete
with urban locations for wages, limited access to housing, higher
workloads, and few job opportunities for workers' relatives.
Those challenges aren't limited to physicians. Rural communities
also have a smaller proportion of behavioral health workers like
psychiatrists/counselors and social workers, than urban communities do.
These communities have also been hit hard by the fentanyl crisis, but
they don't have the resources or staffing to get people the treatment
they need to recover.
The Substance Use Disorder Treatment and Recovery Loan Repayment
Program provides loan repayment to behavioral health workers who
practice in high-need communities, including in some rural areas. Yet
the program is so underfunded that in the last fiscal year, no
Washingtonians received relief through it.
Would expanding the number of people who can benefit from this
program help relieve problems with behavioral health workforce
shortages in underserved areas?
Providers in Washington State have told me that they have never
heard of this program, even though it has been in existence since 2018.
Do you agree that the Department of Health and Human Services needs
to do more to promote awareness of this program?
Answer. As you've shared, there is a critical challenge facing our
health-care system as we look at recruitment of not only rural health
professionals but also behavioral health professionals. This shortage
leaves many communities underserved and with limited access to
services. Student debt burdens are a major factor impacting our ability
to sustain a rural health workforce. According to the AAMC, medical
school graduates now owe an average of over $200,000,\11\ which can
make practicing in an underserved area at a lower salary, a less-
attractive option.
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\11\ AAMC. Physician Education Debt and the Cost to Attend Medical
School. https://www.
aamc.org/data-reports/students-residents/report/physician-education-
debt-and-cost-attend-medical-school. Accessed June 5, 2024.
Loan repayment programs like the Substance Use Disorder Treatment
and Recovery program, are one strategy to address this issue. Another
longstanding example is the National Health Service Corps (NHSC) which
offers scholarships and loan repayment to primary care and behavioral
health clinicians in exchange for service in underserved areas.
Notably, ongoing data from NHSC demonstrates that this investment is
effective with at least 80 percent of NHSC participants continuing to
serve their communities after they conclude their commitment.\12\
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\12\ National Health Service Corps, Health Resources and Services
Administration. Mission, Work, and Impact. https://nhsc.hrsa.gov/about-
us. Accessed June 6, 2024.
Unfortunately, as you noted, many rural hospitals and health
professionals lack awareness of these programs. In my experience here
in Wisconsin, there have been instances where medical students or
residency program graduates were unable to find participating rural
sites due to a lack of program knowledge at the hospital or health
center level. Educating both health-care facilities and future health-
care professionals regarding these loan repayment opportunities is
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crucial to expanding our rural workforce.
Question Submitted by Hon. Maggie Hassan
Question. Hospital consolidation has increased in recent years,
which can increase health-care costs for patients and limit patients'
choices in rural communities. When a hospital system buys up all the
medical facilities in a community or even across many States, it often
increases prices, which can make it even more difficult for families to
afford their health care.
At the same time, we need to identify how to better support small
rural hospitals that operate on thin margins. What can Congress do to
support the financial viability of rural hospitals? How do we balance
support for rural facilities with affordability for patients in those
communities?
Answer. Thank you for your commitment to supporting the financial
health of rural hospitals. These institutions are essential for
countless communities, facing unique challenges that necessitate a
multifaceted approach. Here's how Congress can help, while keeping
patient affordability and access to local care in mind:
Permanence for COVID Flexibilities: Support for making temporary
flexibilities implemented during the public health emergency become
permanent could have a significant impact on financial sustainability
and patient access to care. These include the exemption to the 96-hour
rule for Critical Access Hospitals (CAHs), the 3-day hospital stay
requirements for Skilled Nursing Facility (SNF) benefits, and the
expansion of telehealth services.
Providing Security for Rural Health Extenders: Consider permanent
authorization of the Rural Health Extender programs including the
Medicare-Dependent Hospital (MDH) and Low-Volume Hospital (LVH)
designations as well as the rural EMS add-on payments. These programs
offer a lifeline to rural hospitals by recognizing the higher costs
incurred by providing care in a rural area with lower volumes and
higher proportion of Medicare patients. The rural EMS add-on payment
benefits rural hospitals by providing increased revenues keeping their
services in rural and remote areas financially viable while improving
the quality of patient care.
Expanding REH Capabilities: Further bolster the Rural Emergency
Hospital (REH) designation allowing for hospitals to offer a wider
range of services including observation stays, additional outpatient
procedures, and even swing bed services. This would allow hospitals to
better meet the needs of their communities while also allowing for
additional revenue streams as they treat a broader range of patients.
Expanding these services would reduce the need to transfer patients and
keep patients in their local communities. Depending on which services
are deemed eligible, hospitals could qualify for higher reimbursement
rates from Medicare adding to their financial sustainability.
I want to also highlight that Medicare Advantage (MA) has attracted
an increasing number of existing and newly eligible Medicare patients.
According to a Chartis study \13\ released in February, ``between 2019
and 2023, Rural MA enrollment increased 48 percent. This rapid increase
is highlighting differences between traditional Medicare and MA that
have unique implications for rural hospitals. MA net reimbursement to
CAHs is often lower for similar services than traditional Medicare
because MA does not follow cost-based reimbursement. MA may not cover
all traditional Medicare services, including swing beds, often a strong
source of revenue stability for rural hospitals.''
---------------------------------------------------------------------------
\13\ Chartis. Rural Study. Unrelenting Pressure Pushes Rural Safety
Net Crisis into Uncharted Territory. https://www.chartis.com/sites/
default/files/documents/chartis_rural_study_pressure
_pushes_rural_safety_net_crisis_into_uncharted_territory_feb_15_2024_fnl.pdf.
Accessed June 6, 2024.
Implementing these strategies can help strengthen rural hospitals
provide continued access to high quality healthcare in rural
---------------------------------------------------------------------------
communities.
______
Prepared Statement of Michael Topchik, Executive Director,
Chartis Center for Rural Health
Chairman Wyden, Ranking Member Crapo, and members of the committee,
good morning and thank you for the opportunity to discuss the state of
rural health care and the implications for the 46 million Americans who
call rural communities home.
My name is Michael Topchik, and I am the executive director of the
Chartis Center for Rural Health. Chartis is a Chicago-based advisory
firm dedicated to helping clients create and embrace solutions that
make U.S. health care more affordable, accessible, and safe; and my
work within the Center focuses exclusively on rural health care.
America's rural communities are older, less affluent, and less
healthy than their urban counterparts. Rural America is more vulnerable
than nonrural America across nearly all the population health metrics
we track at the Chartis Center for Rural Health. Rates for the leading
causes of death are all higher in rural areas and with ``deaths of
despair,'' rural areas exhibit the worst despair-related mortality
outcomes.\1\, \2\
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\1\ Tanya Lewis, People in Rural Areas Die at Higher Rates Than
Those in Urban Areas, Scientific American, December 14, 2022.
\2\ Beseran et al., Deaths of Despair: A Scoping Review on the
Social Determinants of Drug Overdose, Alcohol-related Liver Disease and
Suicide, International Journal of Environment Research and Public
Health, September 29, 2022.
Recent history has been difficult for the safety net serving
America's rural population, particularly hospitals. Since 2010, we have
lost more than 170 rural hospitals.\3\ Half of all rural hospitals are
now operating in the red and in States without Medicaid expansion, the
metric rises to 55 percent.
---------------------------------------------------------------------------
\3\ The Cecil G. Sheps Center for Health Services Research, the
University of North Carolina. May 2024.
Even when hospitals remain open, access to care is constrained as
facilities are challenged to keep programs open. For example, we have
lost 25 percent of America's rural obstetrics care capacity since 2011.
For expecting mothers in these communities, the journey for labor and
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delivery may now require 30, 45, or even 60 minutes in the car.
As dismal as this sounds, our research indicates the future will be
tougher still. Indeed, our data indicates that 418 hospitals are
vulnerable to closure right now. This is a national threat that will
send shockwaves through communities if unchecked. When rural hospitals
close, accessing care becomes harder and jobs in those communities--
jobs at the hospital and related roles--disappear.
There are three key factors threatening rural hospitals today:
First, rural hospitals have high operating costs and low
reimbursement: The unintended consequences related to the
sequestration and bad debt reimbursement, for example, continue
to chip away at rural hospital reimbursement. To counter
operational and financial pressure, nearly 60 percent of rural
hospitals are now affiliated with a health system. While system
affiliation is shown to help protect against closure in our
vulnerability model, it is not a panacea.
Second, rural hospitals treat a low volume of patients:
There are too few patients and even fewer medical professionals
to deliver care, meaning for many hospitals, the math just does
not work.
Finally, rural hospitals are plagued by staffing shortages:
While rural hospital staffing shortages are not new, the
pandemic transformed a challenge into a full-blown crisis.
These shortages impact patient care today and threaten the
introduction and delivery of services rural communities will
need tomorrow.
Walmart recently announced it is leaving health-care delivery after
just 5 years in the business, citing staffing and reimbursement
challenges. If Walmart can't achieve scale to make this work, it's no
wonder rural hospitals and their communities are struggling to see a
future in which their situation improves.
At the Chartis Center for Rural Health, my team is actively
involved in researching and analyzing the factors driving instability
throughout the rural health safety net. As I noted, the mission of the
safety net to serve under-resourced communities is unraveling. The
latest research conducted by the Chartis Center for Rural Health points
to continued pressures that threaten rural hospitals. Key findings from
our research \4\ include:
---------------------------------------------------------------------------
\4\ Chartis's analysis of rural hospital operating margins for this
study utilized CMS's Healthcare Cost Report Information System (HCRIS)
Q3 2023. Operating margin is computed in accordance with Flex
Monitoring Team guidance. Outliers are excluded. Hospitals for which
data are unavailable are excluded. Reported COVID-19 PHE Funds
(Worksheet G-3 line 24,50) excluded from operating margin. Adjustments
made to operating margin to reflect full 2-percent sequester. Policy
impact data utilizes a number of sources including the Budget Control
Act 2011, the Middle-Class Tax Relief and Job Creation Act of 2023, the
National Center for Rural Health Works 2016, the World Bank 2021, and
the Budget Enforcement Act of 1990.
Rural hospital vulnerability utilizes a multilevel logistic
regression model developed by Chartis. A methodology for the
vulnerability analysis can be found at https://email.chartis.
com/hubfs/CCRH/INDEX%20Top%20100/
CCRH_Vulnerability%20Research%20Methodology%
20FINAL%2002.12.2024.pdf.
The baseline period for the chemotherapy service line loss is 2014-
2021 and utilizes Medicare SAFOP. Chemotherapy services were identified
using HCPCs codes recommended by The Surveillance, Epidemiology, and
End Results (SEER) Program for identifying Chemotherapy Administration
and Drugs in Medicare analyses. HCRIS data is used to determine the
loss of obstetrics in rural communities. The baseline period for the
analysis is 2011-2021. Medicare enrollment and penetration analysis
utilized most recently available HCRIS data as of March 1, 2023.
The percentage of America's rural hospitals operating in the
---------------------------------------------------------------------------
red jumped from 43 percent to 50 percent in the last 12 months.
Fifty-five percent of independent rural hospitals are
operating in the red, while 42 percent of health system-
affiliated rural hospitals are operating at a loss. Nearly 60
percent of rural hospitals are now affiliated with a health
system.
Access to inpatient care continues to deteriorate as more
than 170 rural hospitals since 2010 have either closed or
converted to a model that excludes inpatient care.
Four hundred eighteen rural hospitals are ``vulnerable to
closure'' according to our recent, expanded statistical
analysis.
Between 2011 and 2021, 267 rural hospitals dropped OB
services. This represents nearly 25 percent of America's rural
OB units.
Between 2014 and 2022, 382 rural hospitals have stopped
providing chemotherapy services.
Rural Hospitals Sink Into the Red
Our research has always used rural hospital operating margin as a
foundation for understanding the stability of the safety net (e.g.,
``no margin, no mission''). Today, 50 percent of America's rural
hospitals are operating in the red. This is the highest percentage of
rural hospitals losing money in the past decade. The jump from 43
percent operating in the red last year to 50 percent this year is the
single largest percentage change we have seen in a 12-month period.
Our analysis also found that in 19 States, the median operating
margin is in the red. States with the highest percentage of rural
hospitals operating at a loss include Kansas (89 percent in the red),
New York and Wyoming (83 percent each), Vermont (75 percent), and
Alabama (74 percent). In Kansas, which is home to 99 rural hospitals,
the median operating margin is -10 percent. With the exception of
Delaware (home to just 2 rural hospitals), Utah is the only State where
the percentage of rural hospitals in the red is less than 20 percent.
Although rural hospital instability is national in scale,
facilities in States that have not expanded Medicaid have consistently
performed worse financially than their expansion State counterparts.
This year's analysis not only shows a continuation of that trend but a
similar jump in the percentage of rural hospitals operating in the red.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Across the 10 remaining non-expansion States (Alabama, Florida,
Georgia, Kansas, Mississippi, South Carolina, Tennessee, Texas,
Wisconsin, and Wyoming), the percentage of facilities with a negative
operating margin increased year over year from 51 percent to 55
percent. These States are home to more than 600 rural hospitals in
total. Several of these States are among the most severely affected by
hospital closures and a loss of access to care.
While the pandemic provided a measure of stability to rural
hospital finances through various government intervention programs,
this year's analysis indicates that any positive, residual financial
effects have all but disappeared. Other government policies (e.g.,
sequestration and bad debt reimbursement) continue to chip away at
rural hospital revenue.
For example, our analysis shows that sequestration will cost rural
hospitals more than $500 million this year and the equivalent of 9,000
health-care jobs. Cuts in so-called bad debt reimbursement (i.e., the
delivery of charity care to rural patients unable to pay for medical
services) will claim approximately $175 million in revenue and the
equivalent of an additional 3,100 health-care jobs.
Our analysis also uncovered that 58 percent of rural hospitals are
now affiliated with a health system--up from 56 percent in 2019. The
median operating margin for these affiliated hospitals is 1.7 percent,
compared to -2.2 percent for independent rural hospitals. Additionally,
only 42 percent of health system-affiliated rural hospitals are
operating in the red, compared to 55 percent of independent rural
hospitals. While system affiliation may not make rural hospitals immune
to the issues facing the rural health safety net, this data does
confirm that affiliation can be financially and operationally
advantageous. We expect the percentage of health system-affiliated
rural hospitals to continue to grow. As it does, understanding the full
impact of affiliation will be a priority.
Medicare Advantage Affects Historical Rural Hospital Reimbursement
Practices
Traditional Medicare reimburses Critical Access Hospitals based on
the cost of services provided. Since the advent of the Critical Access
Hospital designation in 1997, this cost-based reimbursement has offset
a rural hospital's typically low patient volume and revenue.
Recently, Medicare Advantage has attracted an increasing number of
existing and newly eligible Medicare patients. Our analysis indicates
that between 2019 and 2023, enrollment in Medicare Advantage in rural
communities increased 48 percent. This rapid increase is highlighting
differences between traditional Medicare and Medicare Advantage that
have unique implications for rural hospitals. In particular:
Common reimbursement models that are employed by Medicare
Advantage and other private health plans differ from
traditional Medicare as they often follow fee-for-service
reimbursement at a percent of Medicare rates and not a
retrospective cost-based reimbursement.
While Medicare Advantage plans are required to provide all
medically necessary services that traditional Medicare covers,
there are targeted examples where the reimbursement policies
may not recognize certain services the same way, including
swing beds, which provide skilled nursing care for patients and
are often a strong source of revenue stability for rural
hospitals.
Private health plans, including Medicare Advantage plans,
commonly have administrative requirements such as prior
authorizations. Rural providers may not be equipped to
efficiently navigate these administrative requirements, which
can lead to increased denials that rural hospitals must
navigate.
Traditional Medicare has standard data reporting which is
made available to rural hospitals. While Medicare Advantage
plans are required to submit data to CMS, this data is not made
available to rural hospitals which may impede a facility's
ability to fully understand their population's health-care
experience and needs.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Across rural and urban communities, the popularity of Medicare
Advantage has increased over the course of the last 5 years. According
to Chartis's national data, penetration in these combined communities
was less than 40 percent in 2019 but is now approaching 50 percent.
Within communities that are home to a rural hospital, the increasing
penetration of Medicare Advantage has been no less stunning.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
According to our analysis, the number of residents in rural
communities enrolled in Medicare Advantage increased from 6.3 million
to 9.2 million between 2019 and 2023. As a result, Medicare Advantage
plans now account for 38 percent of all
Medicare-eligible patients in rural communities. In 7 States (Alabama,
Connecticut, Georgia, Hawaii, Kentucky, Maine, and Michigan), that
percentage now exceeds 50 percent. Close behind this group is a large
cluster of 15 States in which Medicare Advantage now serves between 40
percent and 49 percent of all Medicare beneficiaries.
Erosion of Care Accelerates Through Closures and Conversions
As we have seen over the last 14 years, persistent downward
pressure on rural hospitals often results in dire consequences for
local care. Since 2010, more than 170 rural hospitals have either
closed or adopted an operating model that excludes inpatient care
(e.g., Rural Emergency Hospital conversion, urgent/emergency care
center).\5\
---------------------------------------------------------------------------
\5\ The Cecil G. Sheps Center for Health Services Research. Closed
and converted count as of May 2024.
When a rural hospital closes, the ripple effects are felt
throughout the community. Within many rural communities, the hospital
is often among the largest employers and thus a major contributor to
the local economy. Our analysis shows that when a rural hospital closes
its doors, the loss of hospital jobs is nearly 220 at the median. The
---------------------------------------------------------------------------
loss of nonhospital jobs in the community is 73 at the median.
Measuring the loss of access to inpatient care reveals that 2023
was a record-breaking year for rural health care. Inpatient care
disappeared in 28 rural communities--easily surpassing the previous
high of 18 set in 2020. Hospital closures and the loss of inpatient
care continue to be concentrated highest in States such as Texas (26),
Tennessee (15), Kansas (10), Missouri (10), and Georgia (10).
More Than 400 Facilities Vulnerable to Closure
In 2020, Chartis published an extensive, first-of-its-kind analysis
of rural hospital vulnerability through a multilevel logistic
regression model that determined the probability of closure. At the
time, the model identified 453 rural hospitals vulnerable to closure.
In the 4 years since the publication of that study, 30 of the
facilities identified as vulnerable have closed. Utilizing an updated
data model and more expansive methodology, our newest assessment
indicates that 418 (approximately 20 percent) of America's rural
hospitals are vulnerable to closure.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Our 2024 vulnerability data model analyzed 16 indicators and
determined 9 to be statistically significant in predicting hospital
closure. Among these 9 indicators, those most likely to decrease the
risk of closure are case mix index, government control status, Medicaid
expansion, and average daily census for swing beds/skilled nursing
facility (SNF).
A particularly noteworthy protective measure against closure is the
average daily census for swing beds/SNF. Despite the financial
importance of swing beds and the benefits they provide to patients,
they are not allowed as part of the new Rural Emergency Hospital (REH)
designation.
Table 1: In our vulnerability model, 9 indicators Pwere identified as
statistically significant
------------------------------------------------------------------------
VULNERABILITY MODEL INDICATORS
------------------------------------------------------------------------
Case Mix Index State Status for Medicaid Expansion
------------------------------------------------------------------------
Government Control Status Traditional Medicare Percent Days
------------------------------------------------------------------------
Critical Access Hospital Medicare HMO Percent Days
------------------------------------------------------------------------
Number of Beds Traditional Medicaid Percent Days
------------------------------------------------------------------------
Average Daily Census Swing/SNF Medicaid HMO Pct Days
------------------------------------------------------------------------
Occupancy Years Negative Operating Margin
------------------------------------------------------------------------
Average Age of Plant Change in Net Patient Revenue
------------------------------------------------------------------------
Average Length of Stay Social Vulnerability Index
------------------------------------------------------------------------
Our analysis of rural hospital vulnerability found the highest
levels across the whole of the Southeast, part of the Southwest, and up
into the Great Plains. States with the highest percentage of vulnerable
rural hospitals are Florida (43 percent), Nebraska (41 percent),
Tennessee (41 percent), North Carolina (40 percent), Kansas (38
percent), and Utah (38 percent). With several of these States, there is
noticeable overlap with other metrics indicating vulnerability, such as
operating margin and the loss of access to inpatient care.
When we shift our focus from State-level percentages to the highest
number of vulnerable rural hospitals, many of the same States top the
list. Texas has the most rural hospitals vulnerable to closure in our
analysis: 45. Next are: Kansas (38), Nebraska (29), Oklahoma (22),
North Carolina (19), and Georgia and Mississippi (18 each).
Although vulnerability stretches nationwide, our analysis shows a
small number of States do not have any vulnerable rural hospitals.
States such as Connecticut and Delaware may not be surprising
inclusions, given the small number of rural hospitals in those States.
But Washington (45), Maine (24), New Hampshire (15), and Nevada (14)
are notable. Washington and New Hampshire interestingly have also thus
far avoided any rural hospital closures or conversions to models that
exclude inpatient care.
REH Offers a Lifeline for Some Facilities
In 2023, 19 rural hospitals took advantage of CMS's new Rural
Emergency Hospital (REH) designation.\6\ Introduced in January 2023,
the REH designation offers a pathway for struggling rural hospitals to
retain some health-care services within their communities. Rural
hospitals converting to REH are no longer able to provide inpatient
care, participate in the 340B drug program, or take advantage of swing
beds.
---------------------------------------------------------------------------
\6\ The Cecil G. Sheps Center for Health Services Research. REH
conversion count as of February 2, 2024.
Last year, Chartis developed a unique data model that assessed the
likelihood of REH-eligible facilities in pursuing conversion. We found
that nearly 400 rural hospitals fell into the model's first quadrant
(i.e., most likely to consider pursuing conversion). Of this group, 77
hospitals fell in the 0 to 4th percentile overall and were identified
---------------------------------------------------------------------------
as ``ideal candidates'' for REH conversion.
Given that this program is in its infancy, more time may be
required for conversions to pick up speed. REH conversions will likely
increase as individual States complete the required regulatory approval
processes and more hospitals give REH greater consideration in the wake
of the different pressure points discussed within this study.
That said, we may also see adjustments to the requirements
governing REH conversion. The 340B program, for example, has provided a
wide range of benefits to rural hospitals. Allowing hospitals
converting to REH to maintain participation in the 340B program may
open the door for some rural hospitals to consider the new designation
more strongly.
A survey conducted in 2023 by Chartis in partnership with the
National Rural Health Association found that nearly 80 percent of
respondents had been participating in the 340B program for more than 5
years, and 38 percent said that their hospital's estimated annual 340B
benefit was $750,000 or more.
When asked to identify how 340B savings are utilized, most survey
respondents selected ``support workforce/staffing needs,'' ``add or
expand clinical services,'' and ``provision of charity care.'' This
provides an insightful lens into just how rural hospitals put the 340B
savings to use to support care delivery.
America's Rural Care Deserts Keep Growing
Diminishing access to care within rural communities is not limited
to instances of hospital closure or conversion to a model such as REH.
As part of our safety net analysis, we have been tracking the loss of
other services, most notably OB.
When we first assessed the availability of OB services in rural
communities in 2019, our analysis indicated that access to OB services
disappeared in 152 rural communities between 2011 and 2018. Our latest
analysis reveals a dramatic escalation, especially during the height of
the pandemic. Nearly 25 percent of America's rural hospitals (267) have
stopped providing OB services since 2011. During the peak years of the
pandemic (2020 and 2021), 63 rural hospitals ceased to provide OB
services.
West Virginia has the highest percentage of rural hospitals
dropping OB services from 2011 to 2021. Nearly half (46 percent) of the
rural hospitals that offered OB services in West Virginia eliminated
them during our review period. Close behind are Florida (43 percent),
Pennsylvania (41 percent), and New Hampshire (40 percent). In West
Virginia, Florida, and New Hampshire, the number of rural hospitals
left in the State offering OB services is fewer than 10.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Looking at States losing the greatest overall number of rural
OB units between 2011 and 2021, Minnesota (22), Iowa (20), Texas (17),
Wisconsin (16), and Kansas (14) are at the top of the list. States such
as Utah and Wyoming (with 20 and 16 rural hospitals offering OB
services, respectively) have not yet lost any rural OB units.
Across the safety net, OB is not the only service closing. Our
analysis also indicates that access to chemotherapy is diminishing at
an equally worrisome rate. Between 2014 and 2022, 382 rural hospitals
stopped providing chemotherapy in their communities--an increase from
the 353 reported in our 2023 safety net study.
Texas has the highest percentage of rural hospitals eliminating
chemotherapy from 2014 to 2022. Within Texas, 47 percent of rural
hospitals that offered chemotherapy have since stopping offering the
service. After Texas, Alabama (46 percent), Mississippi (45 percent),
Tennessee (44 percent), and Florida (39 percent) round out the group of
5 States with the highest percentage losses.
As is the case with our OB analysis, some of the same States
suffering the greatest percentage loss have also seen the greatest
number of rural hospitals drop chemotherapy. The State of Texas (57)
again tops the list, followed by Oklahoma (23), Georgia (23), Tennessee
(22), and Mississippi (21).
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Responding to the Reality Within the Data
The fact that 50 percent of rural hospitals are operating in the
red and nearly 420 are vulnerable to closure should serve as an urgent
call to accelerate efforts at the State and national levels to
reinforce the rural health safety net and ensure access to care for
underresourced and socioeconomically disadvantaged communities.
The new REH designation, a larger stake in rural health care at the
health system level, and the resourcefulness and collaboration born
from the pandemic all have laid a foundation upon which hospital
leaders, advocates, and elected officials can build to release some of
the pressures driving rural hospitals into the red. These efforts,
however, will have to be accompanied by innovative ideas that can
ensure rural communities have appropriate and affordable access to the
care they need.
America's rural hospitals have proven capable of incredible
resiliency and an unwavering commitment to serve their communities. Our
annual recognition of Top 100 performers serves as a lens into rural
hospital success stories. The experiences, insights, and best practices
from these types of facilities could jumpstart the exchange of ideas
across the whole of the rural health safety net.
Today's hearing is important and timely. I have dedicated the last
20 years of my career to advancing rural health care in America, and I
am deeply invested in helping rural hospitals deliver quality,
affordable care to some of our most vulnerable communities.
I would like to express sincere thanks to Chartis leadership,
including Anneliese Gerland who is here today for her support; and
William Balfour, Troy Brown, Melanie Pinette, and Ana Wiesse of the
Chartis Center for Rural Health whose research informed this testimony.
Thank you again for the opportunity to speak before you today. I
look forward to your questions.
Links
https://www.chartis.com/rural-health
https://www.chartis.com/insights/shifting-market-medicare-advantage-
shows-continued-growth
https://www.chartis.com/insights/rural-health-safety-net-under-renewed-
pressure-pandemic-fades
https://www.chartis.com/insights/rural-americas-ob-deserts-widen-
fallout-pandemic
https://www.chartis.com/insights/rural-communities-risk-widening-
health-disparities-present-new-challenges-aftermath
https://www.chartis.com/top-performing-rural-hospitals
https://email.chartis.com/hubfs/CCRH/INDEX%20Top%20100/CCRH_Vulnera
bility%20Research%20Methodology%20FINAL%2002.12.2024.pdf
______
Questions Submitted for the Record to Michael Topchik
Questions Submitted by Hon. Chuck Grassley
Question. I often hear how hard it is for rural hospitals to keep
up with prior authorization requests from insurance companies. Some of
this additional burden is driven by the growth of Medicare Advantage in
rural counties. While I am a supporter of the competition that Medicare
Advantage offers, we must aggressively hold these plans accountable. In
January 2024, the Centers for Medicare and Medicaid Services (CMS)
finalized regulations that establish prior authorization timeliness
requirements for Medicare Advantage. CMS estimates that the current
annual cost of prior authorization paperwork for an individual
physician is $54,642 per year. CMS estimates when this regulation goes
into effect in 2026 that those costs will be reduced by $21,026, or 38
percent).
Will the administrative burden be 38 percent less because of these
new regulations?
Answer. We support the efforts of the United States Congress and
Federal agencies such as CMS to devise solutions that could create more
efficiency in the delivery of care, particularly as it relates to rural
care delivery and access. That said, my team has not analyzed this
specific dimension of the CMS regulation, so it is not appropriate for
me to comment on those estimates.
Question. Are there current insurance companies or payers more
willing to adopt administrative simplifications? If so, who are they
and what have they been able to simplify?
Answer. Our discussions with stakeholders from across the rural
health-care spectrum indicate that yes, there are parties willing to
work proactively together to ease different challenges associated with
administrative requirements. These discussions have been general in
nature. Because they have not included actions by specific
organizations, or their efficacy, they do not support additional
comment from us at this time.
Question. You mentioned in your written statement that nearly 60
percent of rural hospitals are now affiliated with a health system. A
rural hospital's affiliation with a health system can take on several
different definitions and arrangements.
Does rural hospital affiliation look the same in every instance?
Are there certain types of affiliations that are more advantageous for
rural hospitals?
Answer. In my opening statement, I noted that 50 percent of
America's rural hospitals are in the red. For those facilities
affiliated with a health system, however, the metric is a slightly more
positive 42 percent. For rural hospitals struggling to keep their doors
open or to find the staff necessary to maintain access to specific
services, affiliation can offer a pathway that supports their mission.
Our research tells us that rural communities are vulnerable and
underserved. The business- and care-related drivers surrounding
affiliation may differ from one instance to the next. But this type of
partnership can, and in many instances does, introduce resources (e.g.,
staff, technology, and physical locations) that help to improve the
local delivery of care. We have found that today, nearly 60 percent of
rural hospitals are system-affiliated, though the specifics of these
affiliation models and arrangements differ across organizations. While
our research has identified the extent of affiliation across the rural
safety net, it does not offer a full assessment of outcomes tied to
specific arrangements for individual rural hospitals that would inform
a viewpoint on that aspect of your question at this time. I expect we
will continue to see growth in affiliation models, given persistent
pressures surrounding rural hospital delivery, access, affordability,
and equity.
Question. You mentioned in your written statement that Medicare
fee-for-service data is made available to rural hospitals while data
from Medicare Advantage plans is not made available.
Are there certain data points more helpful to rural hospitals? What
is the barrier to making this data available?
Answer. Accessing and analyzing complex data sets can be
challenging for rural hospitals, given the types of resource
constraints and staff recruitment challenges we have discussed as part
of this hearing. In our experience, hospital leadership teams generally
desire to leverage sophisticated data and analytics as part of their
strategic decision-making process. The reality, however, is that
financial, technical, and staffing requirements often create barriers
that can be difficult to overcome. Whether the data sets are related to
Medicare Advantage or other aspects of hospital operations, I would
encourage those with a stake in rural health care to explore
opportunities to reduce those barriers.
Question. In my 99-county tour of Iowa, I frequently hear about the
workforce shortages in health care. Some rural hospitals have
established community-led strategies to address their workforce needs.
This includes proactive engagement with middle and high school
students, supporting or developing a pipeline of health-care
professionals with a local college, professional school training
opportunities, and a robust recruitment strategy.
What should a comprehensive workforce strategy look like for a
rural hospital? If possible, please provide leading examples of rural
hospitals deploying a successful community-led strategy.
Answer. All the components you reference in your question (e.g.,
robust recruiting, building a pipeline, and proactively engaging
younger students) are essential and should be part of any rural
hospital's workforce strategy. Strategies that will be most effective
will blend traditional practices with innovative, out-of-the-box
thinking, such as the workforce housing program Mr. Jeremy Davis from
Grande Ronde Hospital described during the hearing. I would also refer
to the expertise offered by other witnesses, including Lori Rodefeld,
who offered very helpful perspective on rural communities and GME, and
Dr. Keith Mueller, who shared perspective on workforce dynamics across
the full care team, including not only physicians and nurses but also
community health workers, behavioral health specialists, pharmacists,
and others who are essential to the provision of rural care.
______
Question Submitted by Hon. John Cornyn
Question. In a February 2023 paper on 340B, your organization notes
the ``program is at a crossroads as it needs greater transparency and
accountability.'' Additionally, further reports highlight 340B's lax
rules incentivize urban hospitals to attain designation as a Rural
Referral Center (RRC), and they are ramping up 340B drug purchases
faster than any other type of 340B hospital (+700 percent over 5
years). However, about 82 percent of Rural Referral Centers in the 340B
program were not located in areas designated as rural by HRSA, and only
about 23 percent of the patients treated by RRCs live in an area
designated as rural by HRSA.
I am curious to learn what reform ideas Chartis can share to
improve program accountability, increase transparency of how 340B
impacts rural patient affordability, and ensure a direct benefit for
all Medicare patients?
Answer. For rural hospitals, the 340B program is an important tool
for offsetting reimbursement pressure. A survey we conducted in 2023 in
partnership with the National Rural Health Association, for example,
showed that nearly 40 percent of respondents estimated that their
annual 340B benefit was $750,000 or more. Most rural hospital leaders
who participated in the survey said the 340B savings are used to
support their workforce needs, add or expand clinical services, and
accommodate charity care. Beyond understanding how the current program
is utilized by rural hospitals, we have not delved into specific policy
or program design, so I cannot comment on those areas specifically.
______
Questions Submitted by Hon. Robert P. Casey, Jr.
Question. Rural health access goes beyond hospitals and is
especially pertinent in discussions around access to long-term care
services. We need to support the rural health-care workforce, so older
adults and people with disabilities receiving care at home and in
congregate settings receive high quality care that prioritizes their
safety, health, and dignity. The connection between staffing levels in
nursing homes and the safety and quality of care is well established.
The new Federal standard takes a step towards ensuring residents
receive this high-quality care by establishing commonsense staffing
minimums and improving enforcement. A number of States, including my
home State of Pennsylvania, already have staffing requirements in
place. I appreciate that staffing minimums may be difficult to
implement in some areas of the country and was glad to see the Federal
rule offer additional flexibilities for rural nursing homes. Rural
communities would greatly benefit from bipartisan support for policies
that not only protect residents, but also bolster access to nursing
home care, like increased Medicaid funding. That is why I recently
introduced the Long-Term Care Workforce Support Act, which would ensure
that caregiving can be a sustainable, lifelong career by providing
substantial new funding to support workers in every part of the long-
term care industry. My bill includes a grant program to support the
rural health-care workforce. I urge my colleagues on both sides of the
aisle to work with me and other long-term care champions to address
rural workforce concerns while also protecting the quality of long-term
care.
What are some policy proposals that Congress should consider to
ensure people with disabilities and older adults in rural communities
have access to long-term care services?
Answer. Across rural America, the delivery of care is constrained
by staffing shortages and challenging economics. Over the last 2
decades, rural areas have experienced a steady erosion of services,
ranging from long-term care to home health and hospice, and even
emergency medical services (EMS).
Our rural communities are older, less healthy, and less affluent
than their urban counterparts, and more than 60 percent of Healthcare
Professional Shortage Areas (HPSAs) are in rural locations. I applaud
efforts like the Long-Term Care Workforce Support Act, which aims to
create a more viable pathway for individuals wanting to be part of the
health-care ecosystem in rural communities. We also cannot overlook
reimbursement and other related policy levers. To the extent Congress
can consider special rural reimbursements for long-term care or EMS,
for example, we would expect to see greater sustainability of services
in rural communities.
Question. Unfortunately, like many Americans, Pennsylvanians know
the effect of hospital and service closures all too well. In your
testimony, you note that nearly 25 percent of America's rural hospitals
have stopped providing OB services since 2011. In my home State of
Pennsylvania, 32,000 women now live in maternity care deserts. These
closures are coupled with America's dismal maternal mortality and
morbidity rates, creating even greater barriers to healthy mothers and
babies.
What policy options should Congress consider to make certain
hospitals can maintain their labor and delivery services, ensuring
women and families are never too far from the care they need?
Answer. As our research has shown, America's rural OB deserts are
widening at a rapid rate. Expecting mothers must not only drive further
for delivery but also for prenatal and postnatal care. Providing labor
and delivery services is a costly endeavor for a rural hospital. Most
births in rural communities are reimbursed by Medicaid--which is the
single largest payer for births in this country and widely known for
its relatively lower reimbursement rates. Given their financial duress
and the challenging economics of labor and delivery services, many
rural hospitals are unable to sustain these programs.
If we are to turn the tide on the loss of access to OB, we need to
identify more opportunities for Federal and State partnerships around
Medicaid that have the potential to increase rural hospital
reimbursements for maternal care and expand the scope of care from
prenatal through postpartum into the newborn's first year of life.
Legislative efforts in Washington, DC, such as the Healthy Moms and
Babies Act (H.R. 4605/S. 948) and the CARE for Moms Act (H.R. 5568),
and ongoing work by groups like the American College of Obstetricians
and Gynecologists have the potential to improve maternal and infant
care within rural communities.
At the same time, initiatives to address reimbursement pressure and
improve maternal care through policy should be complemented by care
delivery innovation. Hybrid models that harness telehealth's ability to
bridge geographical gaps, for example, may offer viable avenues for
some rural hospitals or health systems with rural affiliates to provide
prenatal care closer to home while centralizing deliveries at larger
facilities.
______
Question Submitted by Hon. Maggie Hassan
Question. Hospital consolidation has increased in recent years,
which can increase health-care costs for patients and limit patients'
choices in rural communities.
When a hospital system buys up all the medical facilities in a
community or even across many States, it often increases prices, which
can make it even more difficult for families to afford their health
care.
At the same time, we need to identify how to better support small
rural hospitals that operate on thin margins.
What can Congress do to support the financial viability of rural
hospitals? How do we balance support for rural facilities with
affordability for patients in those communities?
Answer. When the mission of a rural hospital and its health system
are aligned (as they most frequently are), then rural hospitals and
their communities tend to benefit from access to additional resources
and services availed by such an affiliation. It is in these instances,
for example, where we commonly see clinical services introduced into
rural areas to meet unmet community health needs. There are also
financial benefits to affiliation: the data shows that 42 percent of
system-affiliated rural hospitals are in the red, as opposed to 55
percent of independent facilities. That said, even many independent
facilities engage in softer affiliations and partnerships with health
systems to support their communities through improved access across the
continuum of care.
Congress can best support affiliated and independent rural
hospitals by exploring opportunities to relieve downward pressure on
hospital reimbursement, expand insurance coverage, and create new
opportunities for investment in rural communities. These include
clinical care innovation afforded by new digitally enabled models and
workforce development efforts.
For example, our research suggests that rural hospitals in States
that have not implemented Medicaid expansion are more vulnerable than
their peers in expansion States. Pressure from other policies, such as
sequestration and bad debt reimbursement, also continues to negatively
impact reimbursement. According to our analysis, sequestration will
cost rural hospitals more than $500 million this year and the
equivalent of 9,000 health-care jobs. Similarly, cuts in bad debt
reimbursement will claim approximately $175 million in revenue and the
equivalent of an additional 3,100 health-care jobs.
Cost-based reimbursement via the Critical Access Hospital program
has helped to offset some of the financial challenges rural hospitals
face and allowed these facilities to continue to serve their
communities. There may be opportunities to revisit equivalent
programmatic changes that could apply to the approximately 800 rural
hospitals that are not designated as critical access and thus unable to
capture the benefits associated with cost-based reimbursement.
______
Submitted by Hon. Elizabeth Warren,
a U.S. Senator From Massachusetts
Congress of the United States
Washington, DC 20515
May 5, 2024
Lucinda M. Baier
President, Chief Executive Officer, and Director
Brookdale Senior Living
111 Westwood Place, Suite 400
Brentwood, Tennessee 37027
Ms. Baier:
We are contacting you to seek an explanation for the discrepancy
between Brookdale Senior Living Inc.'s massive payouts in executive
salaries, stock buybacks and dividends, and the nursing home industry's
simultaneous opposition--based on claims that they are too expensive--
to new rules to increase staffing and protect nursing home residents.
These two competing claims do not add up. A new analysis conducted by
my office reveals that the for-profit nursing home industry diverts
hundreds of millions of dollars in cash away from nursing home staff
and patient care, and into the pockets of company executives and
shareholders. This analysis reveals that three of the largest publicly
traded nursing home companies have paid out nearly $650 million in
dividends, buybacks, and compensation to top executives since 2018.\1\
---------------------------------------------------------------------------
\1\ S&P Capital IQ Data, CY 2018-CY 2023, on file with the Office
of Elizabeth Warren; Senior Living, ``The Largest Assisted Living and
Senior Care Companies,'' Jeff Hoyt, March 13, 2024, https://
www.seniorliving.org/companies/. Staff eliminated facilities that were
not publicly traded, and/or not nursing home facilities. This analysis
focuses on the financial data of three of the largest, publicly traded
nursing home facilities--Brookdale Senior Living, Ensign Group, and
National HealthCare Corporation.
Between 2018 and 2023, Brookdale Senior Living handed out nearly $68
million in dividend payments and stock buybacks, and you and other top
executives received almost $50 million in pay and other compensation
between 2018 and 2022.\2\ These massive expenditures to enrich
shareholders and executives undermine the claim that nursing homes
cannot afford to pay for enough staff to meet the Biden
administration's new nursing home staffing standards.\3\
---------------------------------------------------------------------------
\2\ Id.
\3\ AHCA/NCAL, ``New Analysis Finds Federal Staffing Mandate Would
Require 100,000 Additional Nurses and Nurses' Aides, Cost $6.8 Billion
Per Year,'' September 26, 2023. https://www.ahcancal.org/News-and-
Communications/Press-Releases/Pages/New-Analysis-Finds-Federal-
Staffing-Mandate-Would-Require-100%2C000-Additional-Nurses-and-
Nurses%E2%80%99-Aides%2C-Cost-%246-8-Billion-Pe.aspx.
---------------------------------------------------------------------------
Strong Nursing Home Staffing Standards Would
Improve Nursing Home Resident Care
On April 22, 2024, the Centers for Medicare and Medicaid Services (CMS)
finalized a new rule to set a floor for minimum staffing requirements
in nursing homes.\4\ The rule requires that Medicare and Medicaid-
certified nursing home facilities meet a minimum staffing ratio of 0.55
hours of registered nurse (RN) care per patient per day and 2.45 hours
of nurse aide (NA) care per patient per day, as well as an overall
total of 3.48 hours of nurse care per patient per day.\5\ In addition,
the new standards require that all nursing homes have at least one
registered nurse on site 24 hours per day, 7 days a week.\6\ Several
independent studies support even stronger staffing standards to ensure
resident safety and improved care outcomes.\7\
---------------------------------------------------------------------------
\4\ CMS, ``Medicare and Medicaid Programs: Minimum Staffing
Standards for Long-Term Care Facilities and Medicaid Institutional
Payment Transparency Reporting Final Rule (CMS 3442-F),'' press
release, April 22, 2024, https://www.cms.gov/newsroom/fact-sheets/
medicare-and-medicaid-programs-minimum-staffing-standards-long-term-
care-facilities-and-medicaid-0.
\5\ Id.
\6\ Id.
\7\ Abt Associates Inc., ``Nursing Home Staffing Study:
Comprehensive Report,'' June, 2023, https://edit.cms.gov/files/
document/nursing-home-staffing-study-final-report-appendix-june-
2023.pdf; National Library of Medicine, ``The Relationship Between
Registered Nurses and Nursing Home Quality: An Integrative Review
(2008-2014),'' 2015, Mary Ellen Dellefield, Nickolas G Castle,
Katherine S McGilton, Karen Spilsbury, https://pubmed.ncbi.nlm.nih.gov/
26281280/; National Library of Medicine, ``Nurse Staffing and
Coronavirus Infections in California Nursing Homes,'' August 2020,
Charlene Harrington, Leslie Ross, Susan Chapman, Elizabeth Halifax,
Bruce Spurlock, Debra Bakerjian, https://pubmed.ncbi.nlm.nih.gov/
32635838/.
Nursing home staffing is directly linked to the quality of care
residents receive. A report prepared by Senators Warren, Sanders, and
Blumenthal in November 2023 revealed that nursing homes with higher
staffing levels have higher overall quality ratings, lower levels of
patient abuse, and higher quality care.\8\ Another study of nursing
facilities found that increasing nursing home staffing by 20 minutes
per resident per day was associated with 22 percent fewer confirmed
cases of COVID-19 and 26 percent fewer COVID-19 deaths.\9\
Understaffing in nursing homes is also associated with the misdiagnosis
and over-medication of residents, increasing risks of death.\10\
Finally, a joint investigation in 2023 by the Senate Committee on
Finance and the Senate Special Committee on Aging found that
understaffing at nursing homes contributes to inadequate emergency
preparedness.\11\ Strong staffing standards are essential to ensure
quality of care for millions of residents. The nursing home industry's
opposition to the rule is alarming.
---------------------------------------------------------------------------
\8\ Offices of Senators Elizabeth Warren, Bernie Sanders, and
Richard Blumenthal, ``Residents at Risk: Quality of Care Problems in
Understaffed Nursing Homes and the Need for a New Federal Nursing Home
Staffing Standard,'' November 16, 2023, https://www.warren.senate.gov/
imo/media/doc/Nursing%20Home%20Report%20110823.pdf.
\9\ Journal of the American Geriatrics Society, ``COVID-19
Infections and Deaths among Connecticut Nursing Home Residents:
Facility Correlates,'' Yue Li, Helena Temkin-Greener, Gao Shan, and
Xueya Cai, June 18, 2020, https://doi.org/10.1111/jgs.16689.
\10\ New York Times, ``Phony Diagnoses Hide High Rates of Drugging
at Nursing Homes,'' Katie Thomas, Robert Gebeloff, and Jessica Silver-
Greenberg, September 11, 2021, https://www.
nytimes.com/2021/09/11/health/nursing-homes-schizophrenia-
antipsychotics.html.
\11\ Majority Staff of U.S. Senate Finance Committee and U.S.
Senate Special Committee on Aging, ``Left in the Dark: The Impact of
the 2021 Texas Blackout on Long-Term Care Residents and the Need to
Improve Emergency Preparedness,'' February 22, 2023, https://www.
finance.senate.gov/imo/media/doc/
022223%20Left%20in%20the%20Dark%20Two%20Pager.pdf.
---------------------------------------------------------------------------
The Nursing Home Industry Opposes New Standards
Despite the significant benefits of safe staffing for nursing home
residents, the for-profit nursing home industry has fiercely opposed
the staffing mandate--and is gearing up to kill the rule now that it
has been finalized. Hours after CMS finalized the rule on April 22,
2024 nursing home trade group the American Health Care Association
(AHCA) said it would ``vigorously defend nursing home members by any
means necessary and is exploring all options,'' with legal experts
anticipating the industry will bring the rule to court.\12\ Just over 1
week later, on April 30th, the House Energy and Commerce Committee
considered legislation recently approved out of Ways and Means in March
that would prevent CMS ``from implementing or enforcing'' the Biden
administration's rule,\13\ and in the Senate, some members are
``considering other legislation to roll back the regulation or to
overturn it through the Congressional Review Act,'' an act that allows
Congress to rescind final rules that Federal agencies issue.\14\
---------------------------------------------------------------------------
\12\ Modern Healthcare, ``Legal challenges likely for nursing home
staffing mandate,'' Diane Eastabrook, April 29, 2024, https://
www.modernhealthcare.com/providers/nursing-home-staffing-rule-court-
lawsuit-ahca.
\13\ Axios, ``E&C considers bills overturning Biden rules,''
Victoria Knight, April 30, 2024, https://www.axios.com/pro/health-care-
policy/2024/04/30/gop-bills-overturn-biden-rules; McKnights Long-Term
Care News, ``Bill to block staffing rule, other LTC measures to
headline Congressional hearing,'' Kimberly Marselas, April 29, 2024,
https://www.mcknights.com/news/bill-to-block-staffing-rule-other-ltc-
measures-to-headline-congressional-hearing/.
\14\ Modern Healthcare, ``Legal challenges likely for nursing home
staffing mandate,'' Diane Eastabrook, April 29, 2024, https://
www.modernhealthcare.com/providers/nursing-home-staffing-rule-court-
lawsuit-ahca.
The AHCA--the largest association representing long-term and post-acute
care providers in the U.S. (and an organization to which Brookdale
Senior Living belongs)\15\--in its campaign against the rule, has cited
concerns about ``increased operating costs'' and a shortage of
available nursing home staff.\16\ You submitted a public comment to CMS
on behalf of Brookdale Senior Living Inc. strongly encouraging CMS to
abandon the rule, arguing that it would force homes to ``cease
operations'' due to an inability to meet the rule's ``onerous
requirements.''\17\
---------------------------------------------------------------------------
\15\ AHCA/NCAL, Facility Directory, https://members.ahcancal.org/
Membership/Facility-Directory. A facility directory search reveals
Brookdale has many facilities associated with the AHCA.
\16\ AHCA/NCAL, ``New Analysis Finds Federal Staffing Mandate Would
Require 100,000 Additional Nurses and Nurses' Aides, Cost $6.8 Billion
Per Year,'' press release, September 26, 2023, https://
www.ahcancal.org/News-and-Communications/Press-Releases/Pages/New-
Analysis-Finds-Federal-Staffing-Mandate-Would-Require-100%2C000-
Additional-Nurses-and-Nurses%E2
%80%99-Aides%2C-Cost-%246-8-Billion-Pe.aspx.
\17\ Comment on CMS-2023-0144-0001, ``Brookdale Senior Living
Comment on CMS SNF Staffing Proposed Rule,'' Lucinda Baier, October 27,
2023, p. 1, https://www.regulations.gov/comment/CMS-2023-0144-19593.
This opposition makes little sense on the most obvious level: thousands
of nursing homes already meet the CMS staffing requirements.\18\
Additionally, despite claims that there is a nursing shortage, the
number of nurses passing the nursing licensure exam has steadily grown
since 2017.\19\ However, turnover is high due to poor working
conditions, understaffing of facilities, and low pay--conditions that
you are in position to rectify.\20\ CMS' new rule to set a minimum
staffing standard would make these jobs more attractive to workers.\21\
---------------------------------------------------------------------------
\18\ KFF, ``What Share of Nursing Facilities Might Meet Proposed
New Requirements for Nursing Staff Hours?'' Alice Burns, Priya
Chidambaram, Tricia Neuman, and Robin Rudowitz, September 18, 2023,
https://www.kff.org/medicaid/issue-brief/what-share-of-nursing-
facilities-might-meet-proposed-new-requirements-for-nursing-staff-
hours/.
\19\ National Nurses United Memorandum to Interested Parties,
``Nurses insist: There is no `shortage,' but there is a serious
hospital staffing crisis,'' May 15, 2023, p. 2, https://www.
nationalnursesunited.org/sites/default/files/nnu/documents/
Reporter_Memo_Hospital_Staffing
_Crisis.pdf.
\20\ National Nurses United Memorandum to Interested Parties,
``Nurses insist: There is no `shortage,' but there is a serious
hospital staffing crisis,'' May 15, 2023, https://www.national
nursesunited.org/sites/default/files/nnu/documents/
Reporter_Memo_Hospital_Staffing_Crisis.
pdf; Institute for Women's Policy Research, ``Solving the Nursing
Shortage through Higher Wages,'' Vicky Lovell, 2006, p. 8, https://
people.umass.edu/econ340/rn_shortage_iwpr.pdf.
\21\ Institute for Women's Policy Research, ``Solving the Nursing
Shortage through Higher Wages,'' Vicky Lovell, 2006, pp. 8-9, https://
people.umass.edu/econ340/rn_shortage_iwpr.pdf.
Three of the Largest For-Profit Nursing Homes Handed Out Nearly $650
Million in Buybacks, Dividends, and CEO Salaries since 2018
Contrary to the industry's claims that nursing homes are cash strapped
and unable to afford the additional staff needed to comply with the
rule and provide better care for residents, my staff's review of the
financial data from three of the Nation's largest publicly traded
nursing home chains--National HealthCare Corporation, Brookdale Senior
Living Inc., and the Ensign Group Inc.--reveals that the industry has
repeatedly chosen to enrich shareholders and executives, rather than
reinvest in its facilities and workforce to ensure quality care. In
fact, the industry spent nearly $650 million since 2018 on stock
buybacks, dividend payments, and rich rewards to top executives.\22\
---------------------------------------------------------------------------
\22\ S&P Capital IQ Data, CY 2018-CY 2023, on file with the Office
of Elizabeth Warren.
---------------------------------------------------------------------------
1. Stock Buybacks and Dividends
The data analyzed by my staff reveals that these three large, for-
profit nursing homes handed out over $423 million in dividends and
stock buybacks since 2018. (Table 1) These buybacks and dividends
represent excess revenues that could have been used to improve quality
of care, increase staff wages, offer staff trainings, or hire new
staff. Instead, they were used to enrich executives and shareholders.
Combined, the three companies paid out over $423 million in buybacks
and dividends between 2018 and 2023, and Brookdale Senior Living gave
out nearly $68 million. (Table 1)
Table 1. Dividend Payments and Stock Buybacks by Three of the Largest Publicly Traded Nursing Home Companies in
the U.S. 2018-2023 \23\
----------------------------------------------------------------------------------------------------------------
Company Name
-----------------------------------------------------------------------------
Year National HealthCare Brookdale Senior Living
Corporation The Ensign Group, Inc. Inc.
----------------------------------------------------------------------------------------------------------------
2018 $30,700,000 $9,420,000 $7,320,000
----------------------------------------------------------------------------------------------------------------
\23\ S&P Capital IQ Data.
2019 $32,080,000 $17,080,000 $27,270,000
----------------------------------------------------------------------------------------------------------------
2020 $31,970,000 $36,750,000 $22,160,000
----------------------------------------------------------------------------------------------------------------
2021 $32,870,000 $23,380,000 $4,820,000
----------------------------------------------------------------------------------------------------------------
2022 $44,500,000 $43,750,000 $4,290,000
----------------------------------------------------------------------------------------------------------------
2023 $38,040,000 $14,820,000 $1,920,000
----------------------------------------------------------------------------------------------------------------
TOTAL $210,160,000 $145,200,000 $67,780,000
----------------------------------------------------------------------------------------------------------------
These estimates represent only three of the largest publicly traded
nursing home companies. Thousands of nursing homes are owned by private
equity firms, private real estate investment trusts, or other private
corporations that do not make their profits publicly available and
therefore cannot be included in these estimates.\24\
---------------------------------------------------------------------------
\24\ Fortune, ``For-profit groups have vacuumed up over 70% of
America's nursing homes, and health advocates are worried: `The care
gets really bad,' '' Harris Meyer and KFF Health News, March 12, 2024,
https://fortune.com/2024/03/12/nursing-homes-for-profit-private-
equity/.
---------------------------------------------------------------------------
2. High Executive Salaries
The data analyzed by my staff further indicates that Brookdale Senior
Living and other large for-profit nursing home chains are richly
rewarding their top executives, paying them hundreds of millions of
dollars, while refusing to invest in safe staffing levels, even as
seniors are forced to live in nursing homes with deplorable
conditions.\25\ In total, these three nursing home chains paid their
top executives over $220 million from 2018-2022. (Table 2)
---------------------------------------------------------------------------
\25\ Human Rights Watch, ``US: Concerns of Neglect in Nursing
Homes,'' March 25, 2021, https://www.hrw.org/news/2021/03/25/us-
concerns-neglect-nursing-homes.
You personally received over $15 million in compensation from 2018-
2022. Your other top directors and executives also made millions of
dollars. Brookdale Senior Living's Former Executive VP and CFO received
nearly $6 million in this 5-year period, and your former Executive Vice
President of Strategic Operations made over $3 million in only 3 years
(2018-2020).\26\ In total, Brookdale's top executives and directors
were paid nearly $50 million in this 5-year period (see Table 2). The
other four large nursing home companies also paid out millions of
dollars in compensation for executives and board members.
---------------------------------------------------------------------------
\26\ S&P Capital IQ Data.
Table 2. Total Executive Compensation of Three of the Largest Publicly Traded For-Profit Nursing Homes in the
U.S. 2018-2022 \27\
----------------------------------------------------------------------------------------------------------------
Company Name
-----------------------------------------------------------------------------
Year National HealthCare Brookdale Senior Living
Corporation The Ensign Group, Inc. Inc.
----------------------------------------------------------------------------------------------------------------
2018 $4,434,788 $19,592,785 $12,661,803
----------------------------------------------------------------------------------------------------------------
\27\ Id.
2019 $5,555,999 $24,424,196 $6,918,521
----------------------------------------------------------------------------------------------------------------
2020 $4,505,937 $30,537,187 $9,245,697
----------------------------------------------------------------------------------------------------------------
2021 $7,633,198 $29,679,865 $10,154,726
----------------------------------------------------------------------------------------------------------------
2022 $4,402,202 $40,568,813 $9,960,760
----------------------------------------------------------------------------------------------------------------
TOTAL $26,532,124 $144,802,846 $48,941,507
----------------------------------------------------------------------------------------------------------------
3. Nursing Homes Use Other Schemes to Hide Profits and
Enrich Executives at the Expense of Resident Care
Massive payouts to executives and shareholders are not the only way
that nursing home revenues are diverted from patient care. A detailed
new analysis released earlier this month revealed that nursing homes
artificially decrease their profit margins by redirecting profits to
``related parties.''\28\ By paying especially high rents or management
service fees to a related party that shares the same owner as the
nursing homes, these businesses are able to hide up to two thirds of
their profits.\29\ Nursing homes are increasingly using this deceptive
tactic to bolster their arguments to Congress that it can't meet
quality standards, when in reality their reported losses are funneled
back into their own pockets: between 2001 and 2021, nursing home
payments to related parties more than doubled.\30\ This is additional
evidence that nursing homes can afford to meet higher staffing
standards, but are simply unwilling to do so.
---------------------------------------------------------------------------
\28\ STAT, ``Nursing home owners can hide nearly two-thirds of
their profits, new study shows,'' Brittany Trang, March 7, 2024,
https://www.statnews.com/2024/03/07/nursing-homes-hide-profits-with-
related-party-ploys/.
\29\ Id.
\30\ National Bureau of Economic Research, ``Tunneling and Hidden
Profits in Health Care,'' Ashvin Gandhi and Andrew Olenski, March 4,
2024, p. 10, https://www.nber.org/system/files/working_papers/w32258/
w32258.pdf.
---------------------------------------------------------------------------
Conclusion
There are approximately 1.2 million nursing home residents in the
United States.\31\ We are grievously disappointed by the nursing home
industry's opposition to the administration's efforts to ensure these
residents receive high quality care, and seek an explanation for why
Brookdale Senior Living and other for-profit nursing home companies--
which handed out nearly $650 million in buybacks and dividends and have
richly rewarded their top executives--claim they cannot afford to meet
CMS' new minimum staffing standards. We therefore request that you
provide the following information by May 20, 2024:
---------------------------------------------------------------------------
\31\ U.S. Department of Health and Human Services, Office of
Inspector General, ``Nursing Homes,'' February 29, 2024, https://
oig.hhs.gov/reports-and-publications/featured-topics/nursing-homes/.
1. How does the Board of Brookdale Senior Living determine
executive compensation and bonuses for you and other top executives?
a. What considerations are factored into bonuses received by
you and other top executives?
b. Specifically, are any bonuses determined by quality of
care metrics?
c. Are bonuses tied to profits?
d. Do you receive any kind of bonus tied to reducing staff
or other expenses?
2. What is the average annual compensation for registered nurses
(RNs) and nurse aides (NAs) at Brookdale Senior Living facilities?
3. What is the rate of turnover of nursing staff in Brookdale
Senior Living facilities?
a. What is the average tenure of licensed nurses?
b. What is the average tenure of nurse aides?
4. How much does Brookdale Senior Living spend annually on
training for its nursing staff?
5. Please provide any complaints or comments submitted to the
company by nurses or other staff including the words ``under-staffed,''
``staffing,'' and ``salary''.
6. Please provide a list of all lobbying or advocacy expenditures
by Brookdale, including contributions to the AHCA that may have been
used to lobby or advocate against the finalized nursing home staffing
standards from January 2021 through the present.
Thank you for your attention to this matter.
Sincerely,
Elizabeth Warren Bernard Sanders
United States Senator United States Senator
Richard Blumenthal Lloyd Doggett
United States Senator Member of Congress
Jan Schakowsky
Member of Congress
______
Congress of the United States
Washington, DC 20515
May 5, 2024
Christopher R. Christensen
Executive Chairman
The Ensign Group, Inc.
29222 Rancho Viejo Rd, Suite 127
San Juan Capistrano, CA 92675
Mr. Christensen:
We are contacting you to seek an explanation for the discrepancy
between the Ensign Group Inc.'s massive payouts in executive salaries,
stock buybacks and dividends, and the nursing home industry's
simultaneous opposition--based on claims that they are too expensive--
to new rules to increase staffing and protect nursing home residents.
These two competing claims do not add up. A new analysis conducted by
my office reveals that the for-profit nursing home industry diverts
hundreds of millions of dollars in cash away from nursing home staff
and patient care, and into the pockets of company executives and
shareholders. This analysis reveals that three of the largest publicly
traded nursing home companies have paid out nearly $650 million in
dividends, buybacks, and compensation to top executives since 2018.\1\
---------------------------------------------------------------------------
\1\ S&P Capital IQ Data, CY 2018-CY 2023, on file with the Office
of Elizabeth Warren; Senior Living, ``The Largest Assisted Living and
Senior Care Companies,'' Jeff Hoyt, March 13, 2024, https://
www.seniorliving.org/companies/. Staff eliminated facilities that were
not publicly traded, and/or not nursing home facilities. This analysis
focuses on the financial data of three of the largest, publicly traded
nursing home facilities--Brookdale Senior Living, Ensign Group, and
National HealthCare Corporation.
Between 2018 and 2023, the Ensign Group handed out over $145 million in
dividend payments and stock buybacks, and you and other top executives
received nearly $145 million in pay and other compensation between 2018
and 2022.\2\ Your executives received more in pay and compensation than
executives at the other two nursing home chains combined. These massive
expenditures to enrich shareholders and executives undermine the claim
that nursing homes cannot afford to pay for enough staff to meet the
Biden administration's new nursing home staffing standards.\3\
---------------------------------------------------------------------------
\2\ Id.
\3\ AHCA/NCAL, ``New Analysis Finds Federal Staffing Mandate Would
Require 100,000 Additional Nurses and Nurses' Aides, Cost $6.8 Billion
Per Year,'' September 26, 2023, https://www.ahcancal.org/News-and-
Communications/Press-Releases/Pages/New-Analysis-Finds-Federal-
Staffing-Mandate-Would-Require-100%2C000-Additional-Nurses-and-
Nurses%E2%80%99-Aides%2C-Cost-%246-8-Billion-Pe.aspx.
---------------------------------------------------------------------------
Strong Nursing Home Staffing Standards Would
Improve Nursing Home Resident Care
On April 22, 2024, the Centers for Medicare and Medicaid Services (CMS)
finalized a new rule to set a floor for minimum staffing requirements
in nursing homes.\4\ The rule requires that Medicare and Medicaid-
certified nursing home facilities meet a minimum staffing ratio of 0.55
hours of registered nurse (RN) care per patient per day and 2.45 hours
of nurse aide (NA) care per patient per day, as well as an overall
total of 3.48 hours of nurse care per patient per day.\5\ In addition,
the new standards require that all nursing homes have at least one
registered nurse on site 24 hours per day, 7 days a week.\6\ Several
independent studies support even stronger staffing standards to ensure
resident safety and improved care outcomes.\7\
---------------------------------------------------------------------------
\4\ CMS, ``Medicare and Medicaid Programs: Minimum Staffing
Standards for Long-Term Care Facilities and Medicaid Institutional
Payment Transparency Reporting Final Rule (CMS 3442-F),'' press
release, April 22, 2024, https://www.cms.gov/newsroom/fact-sheets/
medicare-and-medicaid-programs-minimum-staffing-standards-long-term-
care-facilities-and-medicaid-0.
\5\ Id.
\6\ Id.
\7\ Abt Associates Inc., ``Nursing Home Staffing Study:
Comprehensive Report,'' June 2023, https://edit.cms.gov/files/document/
nursing-home-staffing-study-final-report-appendix-june-2023.pdf;
National Library of Medicine, ``The Relationship Between Registered
Nurses and Nursing Home Quality: An Integrative Review (2008-2014),''
2015, Mary Ellen Dellefield, Nickolas G Castle, Katherine S McGilton,
Karen Spilsbury, https://pubmed.ncbi.nlm.nih.gov/26281280/; National
Library of Medicine, ``Nurse Staffing and Coronavirus Infections in
California Nursing Homes,'' August 2020, Charlene Harrington, Leslie
Ross, Susan Chapman, Elizabeth Halifax, Bruce Spurlock, Debra
Bakerjian, https://pubmed.ncbi.nlm.nih.gov/32635838/.
Nursing home staffing is directly linked to the quality of care
residents receive. A report prepared by Senators Warren, Sanders, and
Blumenthal in November 2023 revealed that nursing homes with higher
staffing levels have higher overall quality ratings, lower levels of
patient abuse, and higher quality care.\8\ Another study of nursing
facilities found that increasing nursing home staffing by 20 minutes
per resident per day was associated with 22 percent fewer confirmed
cases of COVID-19 and 26 percent fewer COVID-19 deaths.\9\
Understaffing in nursing homes is also associated with the misdiagnosis
and over-medication of residents, increasing risks of death.\10\
Finally, a joint investigation in 2023 by the Senate Committee on
Finance and the Senate Special Committee on Aging found that
understaffing at nursing homes contributes to inadequate emergency
preparedness.\11\ Strong staffing standards are essential to ensure
quality of care for millions of residents. The nursing home industry's
opposition to the rule is alarming.
---------------------------------------------------------------------------
\8\ Offices of Senators Elizabeth Warren, Bernie Sanders, and
Richard Blumenthal, ``Residents at Risk: Quality of Care Problems in
Understaffed Nursing Homes and the Need for a New Federal Nursing Home
Staffing Standard,'' November 16, 2023, https://www.warren.senate.gov/
imo/media/doc/Nursing%20Home%20Report%20110823.pdf.
\9\ Journal of the American Geriatrics Society, ``COVID-19
Infections and Deaths among Connecticut Nursing Home Residents:
Facility Correlates,'' Yue Li, Helena Temkin-Greener, Gao Shan, and
Xueya Cai, June 18, 2020, https://doi.org/10.1111/jgs.16689.
\10\ New York Times, ``Phony Diagnoses Hide High Rates of Drugging
at Nursing Homes,'' Katie Thomas, Robert Gebeloff, and Jessica Silver-
Greenberg, September 11, 2021, https://www.nytimes.com/2021/09/11/
health/nursing-homes-schizophrenia-antipsychotics.html.
\11\ Majority Staff of U.S. Senate Finance Committee and U.S.
Senate Special Committee on Aging, ``Left in the Dark: The Impact of
the 2021 Texas Blackout on Long-Term Care Residents and the Need to
Improve Emergency Preparedness,'' February 22, 2023, https://www.
finance.senate.gov/imo/media/doc/
022223%20Left%20in%20the%20Dark%20Two%20Pager.pdf.
---------------------------------------------------------------------------
The Nursing Home Industry Opposes New Standards
Despite the significant benefits of safe staffing for nursing home
residents, the for-profit nursing home industry has fiercely opposed
the staffing mandate--and is gearing up to kill the rule now that it
has been finalized. Hours after CMS finalized the rule on April 22,
2024 nursing home trade group the American Health Care Association
(AHCA) said it would ``vigorously defend nursing home members by any
means necessary and is exploring all options,'' with legal experts
anticipating the industry will bring the rule to court.\12\ Just over 1
week later, on April 30th, the House Energy and Commerce Committee
considered legislation recently approved out of Ways and Means in March
that would prevent CMS ``from implementing or enforcing'' the Biden
administration's rule,\13\ and in the Senate, some members are
``considering other legislation to roll back the regulation or to
overturn it through the Congressional Review Act,'' an act that allows
Congress to rescind final rules that Federal agencies issue.\14\
---------------------------------------------------------------------------
\12\ Modern Healthcare, ``Legal challenges likely for nursing home
staffing mandate,'' Diane Eastabrook, April 29, 2024, https://
www.modernhealthcare.com/providers/nursing-home-staffing-rule-court-
lawsuit-ahca.
\13\ Axios, ``E&C considers bills overturning Biden rules,''
Victoria Knight, April 30, 2024, https://www.axios.com/pro/health-care-
policy/2024/04/30/gop-bills-overturn-biden-rules; McKnights Long-Term
Care News, ``Bill to block staffing rule, other LTC measures to
headline Congressional hearing,'' Kimberly Marselas, April 29, 2024,
https://www.mcknights.com/news/bill-to-block-staffing-rule-other-ltc-
measures-to-headline-congressional-hearing/.
\14\ Modern Healthcare, ``Legal challenges likely for nursing home
staffing mandate,'' Diane Eastabrook, April 29, 2024, https://
www.modernhealthcare.com/providers/nursing-home-staffing-rule-court-
lawsuit-ahca.
The AHCA--the largest association representing long-term and post-acute
care providers in the U.S. (and an organization to which the Ensign
Group belongs)\15\--in its campaign against the rule, has cited
concerns about ``increased operating costs'' and a shortage of
available nursing home staff.\16\
---------------------------------------------------------------------------
\15\ AHCA/NCAL, Facility Directory, https://members.ahcancal.org/
Membership/Facility-Directory; the Ensign Group, ``Locations,'' https:/
/ensigngroup.net/map/. A cross-check of the Ensign Group's facility
names and the AHCA/NCAL facility directory search reveals Ensign has
many facilities associated with the AHCA.
\16\ AHCA/NCAL, ``New Analysis Finds Federal Staffing Mandate Would
Require 100,000 Additional Nurses and Nurses' Aides, Cost $6.8 Billion
Per Year,'' press release, September 26, 2023, https://
www.ahcancal.org/News-and-Communications/Press-Releases/Pages/New-
Analysis-Finds-Federal-Staffing-Mandate-Would-Require-100%2C000-
Additional-Nurses-and-Nurses%E2
%80%99-Aides%2C-Cost-%246-8-Billion-Pe.aspx.
The Ensign Group has been particularly strategic in its opposition to
the rule. Barry Port, your Chief Executive Officer and Director,\17\
said during the Ensign Group's 2023 third quarter earnings call that
nursing home industry stakeholders should ``shape'' the proposed CMS
staffing rule--arguing that railing against the proposal completely
would be futile, but changing (or weakening) the measure could be more
successful--and prepare to later on overturn it with a ``legal
challenge down the road.''\18\
---------------------------------------------------------------------------
\17\ Ensign Group, ``Management,'' https://
investor.ensigngroup.net/governance/management/default.aspx.
\18\ Skilled Nursing News, ``Ensign CEO: Efforts to Strike Down CMS
Staffing Rule Appear `Futile'-Cut It Can Be Shaped,'' October 26, 2023,
https://skillednursingnews.com/2023/10/ensign-ceo-efforts-to-strike-
down-cms-staffing-rule-appear-futile-but-it-can-be-shaped/?itm_source=pars
ely-api?itm_campaign=parsely_recommended_widget-
2&itmMedium=site_widget&itmSource=
parsely_recommended_widget&itm_content=widget_item-1.
This opposition makes little sense on the most obvious level: thousands
of nursing homes already meet the CMS staffing requirements.\19\
Additionally, despite claims that there is a nursing shortage, the
number of nurses passing the nursing licensure exam has steadily grown
since 2017.\20\ However, turnover is high due to poor working
conditions, understaffing of facilities, and low pay--conditions that
you are in position to rectify.\21\ CMS' new rule to set a minimum
staffing standard would make these jobs more attractive to workers.\22\
---------------------------------------------------------------------------
\19\ KFF, ``What Share of Nursing Facilities Might Meet Proposed
New Requirements for Nursing Staff Hours?'' Alice Burns, Priya
Chidambaram, Tricia Neuman, and Robin Rudowitz, September 18, 2023,
https://www.kff.org/medicaid/issue-brief/what-share-of-nursing-
facilities-might-meet-proposed-new-requirements-for-nursing-staff-
hours/.
\20\ National Nurses United Memorandum to Interested Parties,
``Nurses insist: There is no `shortage,' but there is a serious
hospital staffing crisis,'' May 15, 2023, p. 2, https://www.
nationalnursesunited.org/sites/default/files/nnu/documents/
Reporter_Memo_Hospital_Staffing
_Crisis.pdf.
\21\ National Nurses United Memorandum to Interested Parties,
``Nurses insist: There is no `shortage,' but there is a serious
hospital staffing crisis,'' May 15, 2023, https://www.
nationalnursesunited.org/sites/default/files/nnu/documents/
Reporter_Memo_Hospital_Staffing
_Crisis.pdf; Institute for Women's Policy Research, ``Solving the
Nursing Shortage through Higher Wages,'' Vicky Lovell, 2006, p. 8,
https://people.umass.edu/econ340/rn_shortage_iwpr.pdf.
\22\ Institute for Women's Policy Research, ``Solving the Nursing
Shortage through Higher Wages,'' Vicky Lovell, 2006, pp. 8-9, https://
people.umass.edu/econ340/rn_shortage_iwpr.pdf.
---------------------------------------------------------------------------
Three of the Largest For-Profit Nursing Homes Handed Out Nearly $650
Million in Buybacks, Dividends, and CEO Salaries since 2018
Contrary to the industry's claims that nursing homes are cash strapped
and unable to afford the additional staff needed to comply with the
rule and provide better care for residents, my staff's review of the
financial data from three of the Nation's largest publicly traded
nursing home chains--National HealthCare Corporation, Brookdale Senior
Living Inc., and the Ensign Group Inc.-- reveals that the industry has
repeatedly chosen to enrich shareholders and executives, rather than
reinvest in its facilities and workforce to ensure quality care. In
fact, the industry spent nearly $650 million since 2018 on stock
buybacks, dividend payments, and rich rewards to top executives.\23\
---------------------------------------------------------------------------
\23\ S&P Capital IQ Data, CY 2018-CY 2023, on file with the Office
of Elizabeth Warren.
---------------------------------------------------------------------------
1. Stock Buybacks and Dividends
The data analyzed by my staff reveals that these three large, for-
profit nursing homes handed out over $423 million in dividends and
stock buybacks since 2018. (Table 1) These buybacks and dividends
represent excess revenues that could have been used to improve quality
of care, increase staff wages, offer staff trainings, or hire new
staff. Instead, they were used to enrich executives and shareholders.
Combined, the three companies paid out over $423 million in buybacks
and dividends between 2018 and 2023, and the Ensign Group gave out over
$145 million. (Table 1)
Table 1. Dividend Payments and Stock Buybacks by Three of the Largest Publicly Traded Nursing Home Companies in
the U.S. 2018-2023 \24\
----------------------------------------------------------------------------------------------------------------
Company Name
-----------------------------------------------------------------------------
Year National HealthCare Brookdale Senior Living
Corporation The Ensign Group, Inc. Inc.
----------------------------------------------------------------------------------------------------------------
2018 $30,700,000 $9,420,000 $7,320,000
----------------------------------------------------------------------------------------------------------------
\24\ S&P Capital IQ Data.
2019 $32,080,000 $17,080,000 $27,270,000
----------------------------------------------------------------------------------------------------------------
2020 $31,970,000 $36,750,000 $22,160,000
----------------------------------------------------------------------------------------------------------------
2021 $32,870,000 $23,380,000 $4,820,000
----------------------------------------------------------------------------------------------------------------
2022 $44,500,000 $43,750,000 $4,290,000
----------------------------------------------------------------------------------------------------------------
2023 $38,040,000 $14,820,000 $1,920,000
----------------------------------------------------------------------------------------------------------------
TOTAL $210,160,000 $145,200,000 $67,780,000
----------------------------------------------------------------------------------------------------------------
These estimates represent only three of the largest publicly traded
nursing home companies. Thousands of nursing homes are owned by private
equity firms, private real estate investment trusts, or other private
corporations that do not make their profits publicly available and
therefore cannot be included in these estimates.\25\
---------------------------------------------------------------------------
\25\ Fortune, ``For-profit groups have vacuumed up over 70% of
America's nursing homes, and health advocates are worried: `The care
gets really bad,' '' Harris Meyer and KFF Health News, March 12, 2024,
https://fortune.com/2024/03/12/nursing-homes-for-profit-private-
equity/.
---------------------------------------------------------------------------
2. High Executive Salaries
The data analyzed by my staff further indicates that the Ensign Group
and other large for-profit nursing home chains are richly rewarding
their top executives, paying them hundreds of millions of dollars,
while refusing to invest in safe staffing levels, even as seniors are
forced to live in nursing homes with deplorable conditions.\26\ In
total, these three nursing home chains paid their top executives over
$220 million from 2018-2022. (Table 2)
---------------------------------------------------------------------------
\26\ Human Rights Watch, ``US: Concerns of Neglect in Nursing
Homes,'' March 25, 2021, https://www.hrw.org/news/2021/03/25/us-
concerns-neglect-nursing-homes.
You personally received over $30.5 million in compensation between 2018
and 2022. Your other top directors and executives also made millions of
dollars.\27\ The Ensign Group's CFO, Executive VP, and Director made
over $35 million in this 5-year period, and your Chief Investment
Officer, Executive VP and Secretary made over $21 million.\28\ In
total, The Ensign Group's top executives and directors were paid nearly
$145 million in this 5-year period (see Table 2)--more than any of the
other large, for-profit nursing home chains.
---------------------------------------------------------------------------
\27\ S&P Capital IQ Data.
\28\ Id.
Table 2. Total Executive Compensation of Three of the Largest Publicly Traded For-Profit Nursing Homes in the
U.S. 2018-2022 \29\
----------------------------------------------------------------------------------------------------------------
Company Name
-----------------------------------------------------------------------------
Year National HealthCare Brookdale Senior Living
Corporation The Ensign Group, Inc. Inc.
----------------------------------------------------------------------------------------------------------------
2018 $4,434,788 $19,592,785 $12,661,803
----------------------------------------------------------------------------------------------------------------
\29\ Id.
2019 $5,555,999 $24,424,196 $6,918,521
----------------------------------------------------------------------------------------------------------------
2020 $4,505,937 $30,537,187 $9,245,697
----------------------------------------------------------------------------------------------------------------
2021 $7,633,198 $29,679,865 $10,154,726
----------------------------------------------------------------------------------------------------------------
2022 $4,402,202 $40,568,813 $9,960,760
----------------------------------------------------------------------------------------------------------------
TOTAL $26,532,124 $144,802,846 $48,941,507
----------------------------------------------------------------------------------------------------------------
1. Nursing Homes Use Other Schemes to Hide Profits and
Enrich Executives at the Expense of Resident Care
Massive payouts to executives and shareholders are not the only way
that nursing home revenues are diverted from patient care. A detailed
new analysis released earlier this month revealed that nursing homes
artificially decrease their profit margins by redirecting profits to
``related parties.''\30\ By paying especially high rents or management
service fees to a related party that shares the same owner as the
nursing homes, these businesses are able to hide up to two thirds of
their profits.\31\ Nursing homes are increasingly using this deceptive
tactic to bolster their arguments to Congress that it can't meet
quality standards, when in reality their reported losses are funneled
back into their own pockets: between 2001 and 2021, nursing home
payments to related parties more than doubled.\32\ This is additional
evidence that nursing homes can afford to meet higher staffing
standards, but are simply unwilling to do so.
---------------------------------------------------------------------------
\30\ STAT, ``Nursing home owners can hide nearly two-thirds of
their profits, new study shows,'' Brittany Trang, March 7, 2024,
https://www.statnews.com/2024/03/07/nursing-homes-hide-profits-with-
related-party-ploys/.
\31\ Id.
\32\ National Bureau of Economic Research, ``Tunneling and Hidden
Profits in Health Care,'' Ashvin Gandhi and Andrew Olenski, March 4,
2024, p. 10, https://www.nber.org/system/files/working--papers/w32258/
w32258.pdf.
---------------------------------------------------------------------------
Conclusion
There are approximately 1.2 million nursing home residents in the
United States.\33\ We are grievously disappointed by the nursing home
industry's opposition to the administration's efforts to ensure these
residents receive high quality care, and seek an explanation for why
the Ensign Group and other for-profit nursing home companies--which
handed out nearly $650 million in buybacks and dividends and have
richly rewarded their top executives--claim they cannot afford to meet
CMS' new minimum staffing standards. We therefore request that you
provide the following information by May 20, 2024:
---------------------------------------------------------------------------
\33\ U.S. Department of Health and Human Services, Office of
Inspector General, ``Nursing Homes,'' February 29, 2024, https://
oig.hhs.gov/reports-and-publications/featured-topics/nursing-homes/.
1. How does the Board of the Ensign Group determine executive
compensation and bonuses for you and other top executives?
a. What considerations are factored into bonuses received by
you and other top executives?
b. Specifically, are any bonuses determined by quality of
care metrics?
c. Are bonuses tied to profits?
d. Do you receive any kind of bonus tied to reducing staff
or other expenses?
2. What is the average annual compensation for registered nurses
(RNs) and nurse aides (NAs) at Ensign facilities?
3. What is the rate of turnover of nursing staff in Ensign
facilities?
a. What is the average tenure of licensed nurses?
b. What is the average tenure of nurse aides?
4. How much does the Ensign Group spend annually on training for
its nursing staff?
5. Please provide any complaints or comments submitted to the
company by nurses or other staff including the words ``under-staffed,''
``staffing,'' and ``salary''.
6. Please provide a list of all lobbying or advocacy expenditures
by the Ensign Group, including contributions to the AHCA that may have
been used to lobby or advocate against the proposed nursing home
staffing standards from January 2021 through the present.
Thank you for your attention to this matter.
Sincerely,
Elizabeth Warren Bernard Sanders
United States Senator United States Senator
Richard Blumenthal Lloyd Doggett
United States Senator Member of Congress
Jan Schakowsky
Member of Congress
______
Congress of the United States
Washington, DC 20515
May 5, 2024
Stephen F. Flatt
Chief Executive Officer and Inside Director
National HealthCare Corporation
100 East Vine Street
Murfreesboro, TN 37130
Mr. Flatt:
We are contacting you to seek an explanation for the discrepancy
between National HealthCare Corporation's massive payouts in executive
salaries, stock buybacks and dividends, and the nursing home industry's
simultaneous opposition--based on claims that they are too expensive--
to new rules to increase staffing and protect nursing home residents.
These two competing claims do not add up. A new analysis conducted by
my office reveals that the for-profit nursing home industry diverts
hundreds of millions of dollars in cash away from nursing home staff
and patient care, and into the pockets of company executives and
shareholders. This analysis reveals that three of the largest publicly
traded nursing home companies have paid out nearly $650 million in
dividends, buybacks, and compensation to top executives since 2018.\1\
---------------------------------------------------------------------------
\1\ S&P Capital IQ Data, CY 2018-CY 2023, on file with the Office
of Elizabeth Warren; Senior Living, ``The Largest Assisted Living and
Senior Care Companies,'' Jeff Hoyt, March 13, 2024, https://
www.seniorliving.org/companies/. Staff eliminated facilities that were
not publicly traded, and/or not nursing home facilities. This analysis
focuses on the financial data of three of the largest, publicly traded
nursing home facilities--Brookdale Senior Living, Ensign Group, and
National HealthCare Corporation.
Between 2018 and 2023, National HealthCare Corporation handed out over
$200 million in dividend payments and stock buybacks, and you and other
top executives received over $26.5 million in pay and other
compensation between 2018 and 2022.\2\ These massive expenditures to
enrich shareholders and executives undermine the claim that nursing
homes cannot afford to pay for enough staff to meet the Biden
administration's new nursing home staffing standards.\3\
---------------------------------------------------------------------------
\2\ Id.
\3\ AHCA/NCAL, ``New Analysis Finds Federal Staffing Mandate Would
Require 100,000 Additional Nurses and Nurses' Aides, Cost $6.8 Billion
Per Year,'' September 26, 2023. https://www.ahcancal.org/News-and-
Communications/Press-Releases/Pages/New-Analysis-Finds-Federal-
Staffing-Mandate-Would-Require-100%2C000-Additional-Nurses-and-
Nurses%E2%80%99-Aides%2C-Cost-%246-8-Billion-Pe.aspx.
---------------------------------------------------------------------------
Strong Nursing Home Staffing Standards Would
Improve Nursing Home Resident Care
On April 22, 2024, the Centers for Medicare and Medicaid Services (CMS)
finalized a new rule to set a floor for minimum staffing requirements
in nursing homes.\4\ The rule requires that Medicare and Medicaid-
certified nursing home facilities meet a minimum staffing ratio of 0.55
hours of registered nurse (RN) care per patient per day and 2.45 hours
of nurse aide (NA) care per patient per day, as well as an overall
total of 3.48 hours of nurse care per patient per day.\5\ In addition,
the new standards require that all nursing homes have at least one
registered nurse on site 24 hours per day, 7 days a week.\6\ Several
independent studies support even stronger staffing standards to ensure
resident safety and improved care outcomes.\7\
---------------------------------------------------------------------------
\4\ CMS, ``Medicare and Medicaid Programs: Minimum Staffing
Standards for Long-Term Care Facilities and Medicaid Institutional
Payment Transparency Reporting Final Rule (CMS 3442-F),'' press
release, April 22, 2024, https://www.cms.gov/newsroom/fact-sheets/
medicare-and-medicaid-programs-minimum-staffing-standards-long-term-
care-facilities-and-medicaid-0.
\5\ Id.
\6\ Id.
\7\ Abt Associates Inc., ``Nursing Home Staffing Study:
Comprehensive Report,'' June 2023, https://edit.cms.gov/files/document/
nursing-home-staffing-study-final-report-appendix-june-2023.pdf;
National Library of Medicine,``The Relationship Between Registered
Nurses and Nursing Home Quality: An Integrative Review (2008-2014),''
2015, Mary Ellen Dellefield, Nickolas G Castle, Katherine S McGilton,
Karen Spilsbury, https://pubmed.ncbi.nlm.nih.gov/26281280
/; National Library of Medicine, ``Nurse Staffing and Coronavirus
Infections in California Nursing Homes,'' August 2020, Charlene
Harrington, Leslie Ross, Susan Chapman, Elizabeth Halifax, Bruce
Spurlock, Debra Bakerjian, https://pubmed.ncbi.nlm.nih.gov/32635838/.
Nursing home staffing is directly linked to the quality of care
residents receive. A report prepared by Senators Warren, Sanders, and
Blumenthal in November 2023 revealed that nursing homes with higher
staffing levels have higher overall quality ratings, lower levels of
patient abuse, and higher quality care.\8\ Another study of nursing
facilities found that increasing nursing home staffing by 20 minutes
per resident per day was associated with 22 percent fewer confirmed
cases of COVID-19 and 26 percent fewer COVID-19 deaths.\9\
Understaffing in nursing homes is also associated with the misdiagnosis
and over-medication of residents, increasing risks of death.\10\
Finally, a joint investigation in 2023 by the Senate Committee on
Finance and the Senate Special Committee on Aging found that
understaffing at nursing homes contributes to inadequate emergency
preparedness.\11\ Strong staffing standards are essential to ensure
quality of care for millions of residents. The nursing home industry's
opposition to the rule is alarming.
---------------------------------------------------------------------------
\8\ Offices of Senators Elizabeth Warren, Bernie Sanders, and
Richard Blumenthal, ``Residents at Risk: Quality of Care Problems in
Understaffed Nursing Homes and the Need for a New Federal Nursing Home
Staffing Standard,'' November 16, 2023, https://www.warren.senate.gov/
imo/media/doc/Nursing%20Home%20Report%20110823.pdf.
\9\ Journal of the American Geriatrics Society, ``COVID-19
Infections and Deaths among Connecticut Nursing Home Residents:
Facility Correlates,'' Yue Li, Helena Temkin-Greener, Gao Shan, and
Xueya Cai, June 18, 2020, https://doi.org/10.1111/jgs.16689.
\10\ New York Times, ``Phony Diagnoses Hide High Rates of Drugging
at Nursing Homes,'' Katie Thomas, Robert Gebeloff, and Jessica Silver-
Greenberg, September 11, 2021, https://www.nytimes.com/2021/09/11/
health/nursing-homes-schizophrenia-antipsychotics.html.
\11\ Majority Staff of U.S. Senate Finance Committee and U.S.
Senate Special Committee on Aging, ``Left in the Dark: The Impact of
the 2021 Texas Blackout on Long-Term Care Residents and the Need to
Improve Emergency Preparedness,'' February 22, 2023, https://www.
finance.senate.gov/imo/media/doc/
022223%20Left%20in%20the%20Dark%20Two%20Pager.pdf.
---------------------------------------------------------------------------
The Nursing Home Industry Opposes New Standards
Despite the significant benefits of safe staffing for nursing home
residents, the for-profit nursing home industry has fiercely opposed
the staffing mandate--and is gearing up to kill the rule now that it
has been finalized. Hours after CMS finalized the rule on April 22,
2024 nursing home trade group the American Health Care Association
(AHCA) said it would ``vigorously defend nursing home members by any
means necessary and is exploring all options,'' with legal experts
anticipating the industry will bring the rule to court.\12\ Just over
one week later, on April 30th, the House Energy and Commerce Committee
considered legislation recently approved out of Ways and Means in March
that would prevent CMS ``from implementing or enforcing'' the Biden
administration's rule,\13\ and in the Senate, some members are
``considering other legislation to roll back the regulation or to
overturn it through the Congressional Review Act,'' an act that allows
Congress to rescind final rules that Federal agencies issue.\14\
---------------------------------------------------------------------------
\12\ Modern Healthcare, ``Legal challenges likely for nursing home
staffing mandate,'' Diane Eastabrook, April 29, 2024, https://
www.modernhealthcare.com/providers/nursing-home-staffing-rule-court-
lawsuit-ahca.
\13\ Axios, ``E&C considers bills overturning Biden rules,''
Victoria Knight, April 30, 2024, https://www.axios.com/pro/health-care-
policy/2024/04/30/gop-bills-overturn-biden-rules; McKnights Long-Term
Care News, ``Bill to block staffing rule, other LTC measures to
headline Congressional hearing,'' Kimberly Marselas, April 29, 2024,
https://www.mcknights.com/news/bill-to-block-staffing-rule-other-ltc-
measures-to-headline-congressional-hearing/.
\14\ Modern Healthcare, ``Legal challenges likely for nursing home
staffing mandate,'' Diane Eastabrook, April 29, 2024, https://
www.modernhealthcare.com/providers/nursing-home-staffing-rule-court-
lawsuit-ahca.
The AHCA--the largest association representing long-term and post-acute
care providers in the U.S. (and an organization to which you serve as a
Board member)\15\--in its campaign against the rule, has cited concerns
about ``increased operating costs'' and a shortage of available nursing
home staff.\16\
---------------------------------------------------------------------------
\15\ AHCA/NCAL, ``AHCA/NCAL Elects Board of Governors, Directors at
Annual Convention,'' October 10, 2023, https://www.ahcancal.org/News-
and-Communications/Blog/Pages/AHCAN
CAL-Elects-Board-of-Governors-Directors-at-Annual-Convention.aspx.
\16\ AHCA, ``New Analysis Finds Federal Staffing Mandate Would
Require 100,000 Additional Nurses and Nurses' Aides, Cost $6.8 Billion
Per Year,'' September 26, 2023, https://www.
ahcancal.org/News-and-Communications/Press-Releases/Pages/New-Analysis-
Finds-Federal-Staffing-Mandate-Would-Require-100%2C000-Additional-
Nurses-and-Nurses%E2%80%99-Aides
%2C-Cost-%246-8-Billion-Pe.aspx.
This opposition makes little sense on the most obvious level: thousands
of nursing homes already meet the CMS staffing requirements.\17\
Additionally, despite claims that there is a nursing shortage, the
number of nurses passing the nursing licensure exam has steadily grown
since 2017.\18\ However, turnover is high due to poor working
conditions, understaffing of facilities, and low pay--conditions that
you are in position to rectify.\19\ CMS' new rule to set a minimum
staffing standard would make these jobs more attractive to workers.\20\
---------------------------------------------------------------------------
\17\ KFF, ``What Share of Nursing Facilities Might Meet Proposed
New Requirements for Nursing Staff Hours?'' Alice Burns, Priya
Chidambaram, Tricia Neuman, and Robin Rudowitz, September 18, 2023,
https://www.kff.org/medicaid/issue-brief/what-share-of-nursing-
facilities-might-meet-proposed-new-requirements-for-nursing-staff-
hours/.
\18\ National Nurses United Memorandum to Interested Parties,
``Nurses insist: There is no `shortage,' but there is a serious
hospital staffing crisis,'' May 15, 2023, p. 2, https://www.
nationalnursesunited.org/sites/default/files/nnu/documents/
Reporter_Memo_Hospital_Staffing
_Crisis.pdf.
\19\ National Nurses United Memorandum to Interested Parties,
``Nurses insist: There is no `shortage,' but there is a serious
hospital staffing crisis,'' May 15, 2023, https://www.
nationalnursesunited.org/sites/default/files/nnu/documents/
Reporter_Memo_Hospital_Staffing
_Crisis.pdf; Institute for Women's Policy Research, ``Solving the
Nursing Shortage through Higher Wages,'' Vicky Lovell, 2006, p. 8,
https://people.umass.edu/econ340/rn_shortage_iwpr.pdf.
\20\ Institute for Women's Policy Research, ``Solving the Nursing
Shortage through Higher Wages,'' Vicky Lovell, 2006, pp. 8-9, https://
people.umass.edu/econ340/rn_shortage_iwpr.pdf.
---------------------------------------------------------------------------
Three of the Largest For-Profit Nursing Homes Handed Out Nearly
$650 Million in Buybacks, Dividends, and CEO Salaries since 2018
Contrary to the industry's claims that nursing homes are cash strapped
and unable to afford the additional staff needed to comply with the
rule and provide better care for residents, my staff's review of the
financial data from three of the Nation's largest publicly traded
nursing home chains--National HealthCare Corporation, Brookdale Senior
Living Inc, and the Ensign Group Inc.--reveals that the industry has
repeatedly chosen to enrich shareholders and executives, rather than
reinvest in its facilities and workforce to ensure quality care. In
fact, the industry spent nearly $650 million since 2018 on stock
buybacks, dividend payments, and rich rewards to top executives.\21\
---------------------------------------------------------------------------
\21\ S&P Capital IQ Data, CY 2018-CY 2023, on file with the Office
of Elizabeth Warren.
---------------------------------------------------------------------------
1. Stock Buybacks and Dividends
The data analyzed by my staff reveals that these three large, for-
profit nursing homes handed out over $423 million in dividends and
stock buybacks since 2018. (Table 1) These buybacks and dividends
represent excess revenues that could have been used to improve quality
of care, increase staff wages, offer staff trainings, or hire new
staff. Instead, they were used to enrich executives and shareholders.
Combined, the three companies paid out over $423 million in buybacks
and dividends between 2018 and 2023, and National HealthCare
Corporation paid out over $210 million. (Table 1)
Table 1. Dividend Payments and Stock Buybacks by Three of the Largest Publicly Traded Nursing Home Companies in
the U.S. 2018-2023 \22\
----------------------------------------------------------------------------------------------------------------
Year Company Name
----------------------------------------------------------------------------------------------------------------
National HealthCare Brookdale Senior Living
Corporation The Ensign Group, Inc. Inc.
----------------------------------------------------------------------------------------------------------------
2018 $30,700,000 $9,420,000 $7,320,000
----------------------------------------------------------------------------------------------------------------
\22\ S&P Capital IQ Data.
2019 $32,080,000 $17,080,000 $27,270,000
----------------------------------------------------------------------------------------------------------------
2020 $31,970,000 $36,750,000 $22,160,000
----------------------------------------------------------------------------------------------------------------
2021 $32,870,000 $23,380,000 $4,820,000
----------------------------------------------------------------------------------------------------------------
2022 $44,500,000 $43,750,000 $4,290,000
----------------------------------------------------------------------------------------------------------------
2023 $38,040,000 $14,820,000 $1,920,000
----------------------------------------------------------------------------------------------------------------
TOTAL $210,160,000 $145,200,000 $67,780,000
----------------------------------------------------------------------------------------------------------------
These estimates represent only three of the largest publicly traded
nursing home companies. Thousands of nursing homes are owned by private
equity firms, private real estate investment trusts, or other private
corporations that do not make their profits publicly available and
therefore cannot be included in these estimates.\23\
---------------------------------------------------------------------------
\23\ Fortune, ``For-profit groups have vacuumed up over 70% of
America's nursing homes, and health advocates are worried: `The care
gets really bad,' '' Harris Meyer and KFF Health News, March 12, 2024,
https://fortune.com/2024/03/12/nursing-homes-for-profit-private-equity/.
---------------------------------------------------------------------------
2. High Executive Salaries
The data analyzed by my staff further indicates that National
HealthCare Corporation and other large for-profit nursing home chains
are richly rewarding their top executives, paying them hundreds of
millions of dollars, while refusing to invest in safe staffing levels,
even as seniors are forced to live in nursing homes with deplorable
conditions.\24\ In total, these three nursing home chains paid their
top executives over $220 million from 2018-2022. (Table 2)
---------------------------------------------------------------------------
\24\ Human Rights Watch, ``US: Concerns of Neglect in Nursing
Homes,'' March 25, 2021, https://www.hrw.org/news/2021/03/25/us-
concerns-neglect-nursing-homes.
You personally received over $6.5 million in compensation between 2018-
2022.\25\ Your other top directors and executives also made millions of
dollars. National HealthCare Corporation's President and COO made over
$6 million during this 5-year period, and your Senior Vice President
and Chief Information Officer, made over $2.5 million from 2019 through
2022.\26\ In total, National HealthCare Corporation's top executives
and directors were paid $26.5 million in this 5-year period (see Table 2).
---------------------------------------------------------------------------
\25\ S&P Capital IQ Data.
\26\ Id.
Table 2. Total Executive Compensation of Three of the Largest Publicly Traded For-Profit Nursing Homes in the
U.S. 2018-2022 \27\
----------------------------------------------------------------------------------------------------------------
Year Company Name
----------------------------------------------------------------------------------------------------------------
National HealthCare Brookdale Senior Living
Corporation The Ensign Group, Inc. Inc.
----------------------------------------------------------------------------------------------------------------
2018 $4,434,788 $19,592,785 $12,661,803
----------------------------------------------------------------------------------------------------------------
\27\ Id.
2019 $5,555,999 $24,424,196 $6,918,521
----------------------------------------------------------------------------------------------------------------
2020 $4,505,937 $30,537,187 $9,245,697
----------------------------------------------------------------------------------------------------------------
2021 $7,633,198 $29,679,865 $10,154,726
----------------------------------------------------------------------------------------------------------------
2022 $4,402,202 $40,568,813 $9,960,760
----------------------------------------------------------------------------------------------------------------
TOTAL $26,532,124 $144,802,846 $48,941,507
----------------------------------------------------------------------------------------------------------------
3. Nursing Homes Use Other Schemes to Hide Profits and
Enrich Executives at the Expense of Resident Care
Massive payouts to executives and shareholders are not the only way
that nursing home revenues are diverted from patient care. A detailed
new analysis released earlier this month revealed that nursing homes
artificially decrease their profit margins by redirecting profits to
``related parties.''\28\ By paying especially high rents or management
service fees to a related party that shares the same owner as the
nursing homes, these businesses are able to hide up to two thirds of
their profits.\29\ Nursing homes are increasingly using this deceptive
tactic to bolster their arguments to Congress that it can't meet
quality standards, when in reality their reported losses are funneled
back into their own pockets: between 2001 and 2021, nursing home
payments to related parties more than doubled.\30\ This is additional
evidence that nursing homes can afford to meet higher staffing
standards, but are simply unwilling to do so.
---------------------------------------------------------------------------
\28\ STAT, ``Nursing home owners can hide nearly two-thirds of
their profits, new study shows,'' Brittany Trang, March 7, 2024,
https://www.statnews.com/2024/03/07/nursing-homes-hide-profits-with-
related-party-ploys/.
\29\ Id.
\30\ National Bureau of Economic Research, ``Tunneling and Hidden
Profits in Health Care,'' Ashvin Gandhi and Andrew Olenski, March 4,
2024, p. 10, https://www.nber.org/system/files/working_papers/w32258/
w32258.pdf.
---------------------------------------------------------------------------
Conclusion
There are approximately 1.2 million nursing home residents in the
United States.\31\ We are grievously disappointed by the nursing home
industry's opposition to the administration's efforts to ensure these
residents receive high quality care, and seek an explanation for why
National HealthCare Corporation and other for-profit nursing home
companies--which handed out nearly $650 million in buybacks and
dividends and have richly rewarded their top executives--claim they
cannot afford to meet CMS' new minimum staffing standards. We therefore
request that you provide the following information by May 20, 2024:
---------------------------------------------------------------------------
\31\ U.S. Department of Health and Human Services, Office of
Inspector General, ``Nursing Homes,'' February 29, 2024, https://
oig.hhs.gov/reports-and-publications/featured-topics/nursing-homes/.
1. How does the Board of National HealthCare Corporation determine
executive compensation and bonuses for you and other top executives?
a. What considerations are factored into bonuses received by
you and other top executives?
b. Specifically, are any bonuses determined by quality of
care metrics?
c. Are bonuses tied to profits?
d. Do you receive any kind of bonus tied to reducing staff
or other expenses?
2. What is the average annual compensation for registered nurses
(RNs) and nurse aides (NAs) at National HealthCare Corporation
facilities?
3. What is the rate of turnover of nursing staff in National
HealthCare Corporation facilities?
a. What is the average tenure of licensed nurses?
b. What is the average tenure of nurse aides?
4. How much does National HealthCare Corporation spend annually on
training for its nursing staff?
5. Please provide any complaints or comments submitted to the
company by nurses or other staff including the words ``under-staffed,''
``staffing,'' and ``salary''.
6. Please provide a list of all lobbying or advocacy expenditures
by National HealthCare Corporation, including contributions to the AHCA
that may have been used to lobby or advocate against the finalized
nursing home staffing standards from January 2021 through the present.
Thank you for your attention to this matter.
Sincerely,
Elizabeth Warren Bernard Sanders
United States Senator United States Senator
Richard Blumenthal Lloyd Doggett
United States Senator Member of Congress
Jan Schakowsky
Member of Congress
______
Prepared Statement of Hon. Ron Wyden,
a U.S. Senator From Oregon
This morning the Finance Committee gathers to discuss the
challenges and opportunities in rural communities when it comes to
health care. I'm not going to mince words: without rural health care,
you can't have rural life. It's just that simple. And yet across the
country, rural health providers are struggling to keep their doors
open.
Too many hospitals, doctors, pharmacies, and other providers in
rural areas are operating on a knife edge, forced to choose between
balancing the books and continuing to provide high-quality care to
their communities. Half of all rural hospitals across the country
operate in the red.
There's no better example of this than what Oregonians in Baker
County experienced over the past year. In 1897, St. Elizabeth hospital
opened in Baker City and began delivering babies. One hundred twenty-
six years later, after being acquired by Trinity Health, the sixth
largest hospital chain in the country, they closed their labor and
delivery unit with less than 60 days notice. Trinity said delivering
babies at St. Alphonsus was a money-loser.
Nobody saw this coming. The people of Baker City thought their
hospital could have a brighter future by joining Trinity Health. When I
arrived at a town hall in Baker City last year, there were hundreds of
outraged families, including a number of expecting mothers who had
planned to give birth at St. Alphonsus. The next closest hospital in
that part of eastern Oregon is 45 miles away, along a freeway that can
be closed during the winter because of icy conditions and during the
rest of the year because of truck crashes. In fact, that hospital,
Grande Ronde Hospital in La Grande, OR, is represented here today by
Mr. Davis.
Despite efforts at the Federal, State, and local levels, St.
Alphonsus in Baker City closed its labor and delivery unit completely
last August. The community battled St. Alphonsus to keep basic labor
and delivery equipment in Baker City--in the event the community can
find their own solution in the near future. Rather than find ways to
keep their obstetrics doors open, the hospital offered the paltry sum
of $240,000 to the community. This lump sum amounts to less than $2,000
for each year the hospital has been in the community.
What happened at St. Alphonsus in Baker City is a textbook example
of what's happening in rural communities across the country. These
Americans deserve better. Between 2011 and 2021, one out of every four
rural hospitals in America stopped providing obstetrics services.
That's 267 communities across the country where giving birth locally is
no longer an option. Make no mistake: if it is not practical to give
birth within a reasonable distance of your home, your community is
facing the prospect of becoming a maternity desert. In these areas,
aspiring parents are going to be forced to make tough decisions about
where they live and can start a family.
Everybody knows how hard it is to get enough nurses, let alone
labor and delivery nurses, in rural areas. These hospitals see a low
number of births each year, yet face high costs to keep these services
available around the clock. I'm proposing a fresh approach with
colleagues on this committee that combines steps to address economic
conditions in these communities with extra financial support as long as
large hospital chains don't take the money and run.
Now I'll briefly touch on two other areas where Congress has the
opportunity to make a big-league difference supporting rural
communities: telehealth and workforce.
Telehealth is vital to health care in rural areas. It's a game
changer for seniors to contact their doctor through a telehealth
service instead of spending half the day or more driving to the health
clinic and back home. And it impacts young families who no longer have
to take the day off work to help their grandparent. Congress has
important work to do before the end of the year to renew and strengthen
existing telehealth flexibilities, and I look forward to the Finance
Committee leading that effort on a strong bipartisan basis.
There's still more Congress can do to expand telehealth. It's
unfathomable that clinicians in Idaho or Nevada have to jump through so
many extra hoops and pay for multiple licenses just to provide care via
telehealth to a family in eastern Oregon. Likewise, a senior in
Vancouver, WA can't receive care via telehealth from a doctor across
the Columbia River in Portland--or a senior in southern Oregon from a
doctor in northern California--without mountains of bureaucracy.
It's past time for these artificial barriers preventing Americans
from receiving telehealth across State lines to be knocked down, and
I'll be battling for common-sense improvements like this in Congress's
upcoming work related to telehealth.
I'll wrap up by talking about the health-care workforce. Health-
care jobs often represent an important economic engine for rural life.
But it's becoming more and more difficult to attract qualified health-
care workers to rural communities, in part due to the risk of closures
that I've been discussing. It's going to take an all-hands-on-deck
approach to get this fixed.
Step one is updating the graduate medical education program in
Medicare to make sure rural areas and high-need urban areas are not
given short shrift.
It also means boosting primary care, which is the backbone and
front line of American health care and often experiences the greatest
shortage of providers. And it means looking for innovative solutions
like public-private partnerships to reach into high schools and bring
in students interested in careers in health care.
The Federal Government invests a significant amount of taxpayer
dollars into training the health-care workforce every year. My
challenge to the committee is to make sure those dollars are being
spent in the right places.
I know every single member of this committee is passionate about
improving health care in the rural and underserved areas of the country
they represent, both Democrats and Republicans. Making a difference for
these communities is going to require listening to the needs of rural
areas so this committee can support these communities and focus on
innovative and pioneering approaches that make the most of the federal
dollars this committee is responsible for.
______
Communications
----------
AFT
555 New Jersey Ave., NW
Washington, DC 20001
202-879-4400
https://www.aft.org/
May 21, 2024
The Honorable Ron Wyden
Chairman
United States Senate
Committee on Finance
219 Dirksen Senate Office Building
Washington, DC 20510
Chairman Wyden:
On behalf of the 1.7 million members of the AFT, including educators,
healthcare professionals and public service workers, I write to offer
comments related to the Committee's May 16 hearing titled, ``Rural
Health Care: Supporting Lives and Improving Communities.''
As you are aware, rural communities tend to have sicker, older, and
poorer residents than the country as a whole; and their health systems
often struggle with limited resources, staff shortages and inadequate
infrastructure. Rural residents are more likely to have multiple health
conditions and are at greater risk from numerous conditions, including
heart disease, cancer, stroke, chronic lower respiratory disease,
hypertension, diabetes and arthritis. Despite the clear need, the
provision of healthcare in rural communities has been made more
difficult by a significant number of hospital closures. Since 2010,
more than 120 rural hospitals have closed; 39 have closed since
2018.\1\ An additional 453 rural facilities can be considered
``vulnerable'' to closure based on performance levels.\2\ That's nearly
one-quarter of all rural hospitals in the nation.
---------------------------------------------------------------------------
\1\ Ochieng, et al., ``Funding for Health Care Providers During the
Pandemic: An Update,'' Kaiser Family Foundation, Jan. 27, 2022. https:/
/www.kff.org/coronavirus-covid-19/issue-brief/funding-for-health-care-
providers-during-the-pandemic-an-update/.
\2\ David Raths, ``More Than 450 Rural Hospitals Vulnerable to
Closure,'' Healthcare Innovation, Feb. 24, 2020. https://
www.hcinnovationgroup.com/policy-value-based-care/medicare-medicaid/
news/21126807/chartis-center-research-more-than-450-rural-hospitals-
vulnerable-to-closure.
When rural hospitals avoid closure, they often have their services
hollowed out as they become feeder facilities for larger hospitals
located farther away. Across the nation, for example, numerous rural
labor and delivery departments have closed, forcing expectant parents
to travel greater distances to give birth. While tele-health can assist
rural patients in some cases, neither it, nor information kiosks, can
---------------------------------------------------------------------------
serve as a comprehensive substitute for in-person care.
The impact of rural hospital closures goes beyond the immediate effect
on patients. As Mark Holmes, of the University of North Carolina found,
``rural hospitals are often an anchor institution, providing not only
needed healthcare, but also a significant portion of jobs and billions
of revenues in purchasing goods and services from other businesses. As
a major employer in rural areas, hospitals and their closures have
tremendous impacts on the economies of already vulnerable
communities.''\3\
---------------------------------------------------------------------------
\3\ Mark Holmes, Ph.D., ``Rural Hospital Closure and Effect on
Local Economies,'' North Carolina Rural Health Research and Policy
Analysis Center, March 2022. https://www.ruralhealth
research.org/projects/100002523.
Private equity's focus on profitability has also been uniquely
detrimental to rural healthcare systems. Too many managers of private
equity firms view healthcare as just another industry to strip for
assets and hawk to the highest bidder, while banking stratospheric
fees. These firms often prioritize cost-cutting measures and profit
generation over access to, and the provision of, high-quality
---------------------------------------------------------------------------
healthcare.
Members of our union have witnessed many of these issues firsthand. At
some hospitals, patients and staff have weathered deep service cuts,
department closures and other cutbacks. In one instance, administrators
refused to repair or replace equipment needed for surgical procedures,
resulting in unstable lighting, and conditions so hot and humid in the
summer that surgeons were often sweating profusely over open incisions.
In other hospitals, cutbacks have resulted in understaffing, at times
putting the safety of patients and healthcare professionals at risk.
The proliferation of private equity management in healthcare promises
an increase in adverse patient outcomes, as research has already linked
these harmful results with private equity ownership.\4\
---------------------------------------------------------------------------
\4\ Zirui Song, M.D., Ph.D., ``At Private Equity-Owned Hospitals,
Hospital-Acquired Conditions Increased,'' National Institute for Health
Care Management, Feb. 15, 2024. https://nihcm.org/assets/articles/PE-
Hospitals-Hospital-Acquired-Events_NIHCM-RI_2024-02-15-143556_fyzl.pdf.
Congress must act to address the impact of hospital closures. I urge
you to pass legislation that requires for-profit hospitals to provide
notifications and mitigation plans to the secretary of health and human
services at least 180 days prior to the discontinuation of services or
a full hospital closure. The mitigation plan should outline actions to
preserve access to essential services via partnerships with surrounding
facilities, including patient transportation plans, as well as steps to
transition healthcare employees to other positions. To address the
issue of private equity's involvement in healthcare more broadly, I
urge you to consider the provisions included in Sen. Ed Markey's Health
---------------------------------------------------------------------------
over Wealth Act.
In addition to addressing the broader structural issues, Congress
should take action to help rural hospitals retain and recruit staff.
Doing so requires passing legislation to reduce workplace violence and
increasing funding to address the mental health needs of healthcare
professionals. Congress should also help to expand the rural healthcare
workforce through increasing funding for federal healthcare workforce
programs and supporting high school-focused career outreach and
training programs. High school career and technical education programs
that are linked to local healthcare employers, for example, could be an
invaluable way to improve the pipeline of staff willing to work in
rural areas.
While we all work to strengthen economic and educational opportunities
in rural communities--as the AFT has done in McDowell County, WV; St.
Lawrence County, NY; Lordstown, OH; and in Montana--it is imperative to
address the immediate healthcare challenges. I ask that you
comprehensively move to address hospital closures, the impact of
private equity firms, working conditions, and to improve the workforce
pipeline. The AFT stands ready to help.
Sincerely,
Randi Weingarten
President
______
AHIP
601 Pennsylvania Avenue, NW
South Building, Suite 500
Washington, DC 20004
T 202-778-3200
F 202-331-7487
ahip.org
AHIP is the national association that represents health insurance plans
that provide coverage, services, and solutions for millions of
Americans. Collectively, our member plans provide access to health care
for over 205 million people covered by employer-sponsored insurance,
the individual insurance market, and public programs such as Medicare
and Medicaid.
AHIP is committed to ensuring that people living in rural America have
stable and affordable health insurance coverage and access to high-
quality providers convenient to them. To that end, we appreciate the
opportunity to comment on the Committee's May 16th hearing on rural
health and discuss policies that seek to strengthen rural health care
and enhance the health of rural Americans.
Landscape
Sixty million Americans, one-fifth of the nation's population, live in
rural areas.\1\ Americans in these areas generally have worse health
conditions than those living in urban and suburban areas.\2\ Rural
Americans are more likely to die from heart disease, cancer,
unintentional injury, chronic lower respiratory disease, and stroke
than their urban counterparts.\3\ Rural Americans tend to have higher
rates of cigarette smoking, high blood pressure, and obesity.\4\
---------------------------------------------------------------------------
\1\ https://www.gao.gov/blog/why-health-care-harder-access-rural-
america.
\2\ Ibid.
\3\ https://www.cdc.gov/rural-health/php/about/index.html.
\4\ Ibid.
One issue contributing to these health challenges is that people living
in rural communities generally have far fewer choices of providers and
services located in or near their communities. As just one example, a
scarcity of specialists makes it difficult for people with complex
conditions to receive the care they need,\5\ and rural hospitals are
closing at unprecedented rates.\6\
---------------------------------------------------------------------------
\5\ https://depts.washington.edu/fammed/rhrc/wp-content/uploads/
sites/4/2020/06/RHRC_
PB167_Larson.pdf.
\6\ https://www.shepscenter.unc.edu/programs-projects/rural-health/
rural-hospital-closures/.
These challenges confront each rural community, impacting patients,
their families, rural businesses, and taxpayers.
Medicare
Medicare Advantage Helps Rural Enrollees Meet Challenges in Accessing
Quality Care
Of the 33 million Americans who have opted for a Medicare Advantage
(MA) plan instead of fee-for-service (FFS) Medicare, 4.5 million live
in rural areas. Since 2010, MA enrollment has nearly quadrupled in
rural areas and eligible seniors and individuals with disabilities have
more MA plan offerings than ever.\7\
---------------------------------------------------------------------------
\7\ https://www.kff.org/medicare/issue-brief/medicare-advantage-
enrollment-plan-availability-and-premiums-in-rural-areas/.
A new study of rural hospitals in 14 states,\8\ funded by the Agency
for Healthcare Research and Quality (AHRQ), found that an increase in
county MA enrollment was associated with an increase in hospital
financial stability and reduction in risk of closure. Additionally,
every percentage point increase in MA enrollment was associated with a
4% reduction in risk of hospital closure. ``Our findings counter the
notion that MA plans hurt rural hospitals by not paying them as
generously as [FFS Medicare], the report said.'' The report does not
study the reason for the findings but indicates potential reasons could
be that MA rates are more generous or MA plans are directing patients
to local sources of care.
---------------------------------------------------------------------------
\8\ https://www.ajmc.com/view/medicare-advantage-in-rural-areas-
implications-for-hospital-sustainability.
Additional research has found that quality of care is also generally
better for seniors in MA plans. MA enrollees have fewer readmissions,
fewer preventable hospitalizations, and lower rates of high-risk
medication use than people in FFS Medicare.\9\ MA enrollees also were
more likely to complete treatments,\10\ such as a course of beta-
blockers after a heart attack and statin therapy for cardiovascular
disease, than enrollees in FFS Medicare. MA's unique design enables
plans to offer benefits that can help rural patients overcome barriers
to accessing this higher quality of care, including coverage for
transportation needs, telehealth services, and in-home care.
---------------------------------------------------------------------------
\9\ https://www.globenewswire.com/en/news-release/2023/11/01/
2771249/34825/en/New-Research-From-Inovalon-and-Harvard-University-
Finds-Medicare-Advantage-Beneficiaries-Have-Superior-Quality-Outcomes-
Relative-to-Traditional-Medicare.html.
\10\ www.ahip.org/documents/202312-AHIP_HEDISMeasures-12.5.23.pdf.
---------------------------------------------------------------------------
Recommendations to Strengthen Rural Access for Medicare Beneficiaries
AHIP believes that Congress should consider expanding the ability of MA
plans to use telehealth to meet certain network adequacy requirements
to account for differences in provider availability in rural areas.
This approach could increase the availability of MA options in rural
areas by allowing for networks to consist of both in-person and virtual
care options. We also support extending Medicare telehealth
flexibilities that were put in place because of the COVID-19 pandemic
that continue to allow for a great number of Medicare enrollees to have
access to telehealth services.
Marketplace Coverage
Through the health insurance marketplaces, individuals and families who
don't have employer-based or other coverage can shop for and compare
plans, often with tax credits to help make coverage more affordable.
Congress recently chose to bolster the amount of these tax credits to
make coverage even more affordable. Recent findings \11\ highlight that
these tax credits provide significant benefits to rural residents.
---------------------------------------------------------------------------
\11\ https://www.rwjf.org/en/insights/our-research/2022/05/
american-rescue-plan-acts-enhanced-premium-subsidies-provide-
particularly-large-benefits-to-residents-of-rural-areas.html.
On average, benchmark marketplace premiums weighted across all 50
states are about 10% higher in rural areas than urban areas.\12\
Americans residing in rural areas have experienced substantial
reductions in their premiums due to enhanced tax credits. The Robert
Wood Johnson Foundation found that the value of enhanced tax credits is
higher in rural areas than in urban areas, especially in certain states
like California and Florida.\13\ This has led to more affordable health
insurance and, in turn, access to health care, for rural residents.
---------------------------------------------------------------------------
\12\ Ibid.
\13\ Ibid.
By making insurance more affordable, these changes have facilitated
coverage gains in states that previously had high uninsured rates,
including in these states' rural areas. Since 2020, the states with the
fastest marketplace enrollment growth were also those with the highest
uninsurance rates before enhanced tax credits were implemented.\14\
Most of these states are more rural than the nation as a whole, with
many having 25 to 44% of their populations living in rural areas.\15\
The Kaiser Family Foundation found that 1.4 million Americans were
newly eligible for tax credits for marketplace plans. This policy gives
rural Americans more options for their health care coverage based on
their individual needs and their financial situations. This underscores
the importance of targeted policy interventions in addressing health
care disparities and improving access to affordable coverage,
particularly for vulnerable populations in rural areas.
---------------------------------------------------------------------------
\14\ https://www.kff.org/policy-watch/where-aca-marketplace-
enrollment-is-growing-the-fastest-and-why/.
\15\ https://data.census.gov/all?q=total+rural+population.
---------------------------------------------------------------------------
Recommendation of Protecting Marketplace Affordability for Rural
Americans
Ensure stability in coverage and care for millions of people in rural
communities by extending current tax policies that have boosted
affordability, choice, and competition in the individual market.
Addressing Gaps and Moving Towards Health Equity
There are also infrastructure, socioeconomic, and non-clinical
challenges that create barriers to care for rural communities. For
example, rural communities are likely to face challenges with reliable
transportation, limited availability of broadband internet services,
and fewer options to buy fresh and affordable foods.\16\ Challenges in
accessing clinical care and non-clinical resources result in different
health outcomes for rural versus urban communities. Rural residents
experience significant disparities in life expectancy and economic
mobility, reflecting the complex relationship between health,
opportunity, and geographic isolation. These disparate outcomes include
high rates of:
---------------------------------------------------------------------------
\16\ https://www.ruralhealthinfo.org/topics/social-determinants-of-
health.
Childbirth complications \17\ and infant mortality;\18\
---------------------------------------------------------------------------
\17\ https://www.marchofdimes.org/peristats/reports/united-states/
maternity-care-deserts.
\18\ https://publications.aap.org/pediatrics/article/146/5/
e20200464/75318/Infant-Mortality-in-Rural-and-Nonrural-Counties-in.
---------------------------------------------------------------------------
Mental, behavioral, and development disorders in children;\19\
---------------------------------------------------------------------------
\19\ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7681156/.
---------------------------------------------------------------------------
Suicide;\20\
---------------------------------------------------------------------------
\20\ https://pubmed.ncbi.nlm.nih.gov/33054927/.
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Cancers related to modifiable risks, such as tobacco use, human
papillomavirus (HPV), and preventive screening;\21\
---------------------------------------------------------------------------
\21\ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC9275775/
#::text=Research%20shows%20
that%20low%20screening,83%2C137%2D174).
---------------------------------------------------------------------------
Chronic conditions such as obesity, diabetes, and injury;\22\
and
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\22\ https://www.cdc.gov/mmwr/volumes/68/ss/ss6810a1.htm.
---------------------------------------------------------------------------
Dramatically higher rates of opioid overdose deaths.\23\
---------------------------------------------------------------------------
\23\ https://www.cdc.gov/nchs/products/databriefs/
db440.htm#::text=The%20rate%20of%20
deaths%20involving%20psychostimulants%20with%20abuse%20potential%20was,i
n%20urban%
20counties%20(4.0).
Health inequities are amplified for individuals from underserved and
diverse communities and individuals in low-income brackets. Poor health
outcomes are often correlated with lower educational opportunity and
attainment and lower incomes. Compared to rural non-Hispanic White
adults, rural adult American Indian/Alaska Native (AI/AN), non-Hispanic
Black, and Hispanic adults have reported higher rates of poor health,
and rural non-Hispanic Black and AI/AN adults were more likely to
report having multiple chronic health conditions.\24\ Health plans are
fully committed to doing their part to reduce barriers to care for
rural communities, while promoting affordable, quality, and patient-
centered care.
---------------------------------------------------------------------------
\24\ https://www.ruralhealthinfo.org/topics/rural-health-
disparities#::text=Rural%20risk%20
factors%20for%20health%20disparities%20include%20geographic,healthcare%2
0specialists%20
and%20subspecialists%2C%20and%20limited%20job%20opportunities.
---------------------------------------------------------------------------
Medicaid
Medicaid plays a vital role in providing health coverage to children
and families in rural communities. Medicaid and CHIP cover a larger
share of children and adults in rural counties than in urban
communities--covering 47% of children and 18% of adults in small towns
and rural areas, compared to 40% of children and 15% of adults in urban
counties.\25\ Plans took critical steps to reduce gaps in coverage and
help Americans access health care during the redeterminations and
coverage transitions.\26\ In particular, MCOs partnered with states to
amplify messaging, collect current contact information, partner with
providers and community-based organizations, conduct direct outreach to
members, and help with both renewal paperwork and transitions to other
coverage.
---------------------------------------------------------------------------
\25\ https://ccf.georgetown.edu/2023/08/17/medicaids-coverage-role-
in-small-towns-and-rural-areas/.
\26\ https://www.kff.org/report-section/medicaid-enrollment-and-
unwinding-tracker-overview/.
To ensure eligible individuals have access to Medicaid and CHIP, AHIP
encourages Congress to extend the Consolidated Appropriations Act, 2023
requirements for monthly state reports on eligibility application and
renewal processing data, including the rates of ex parte renewal and
procedural terminations, and to require CMS to continue to make this
data public past the end of the unwinding period. These reports provide
critical information about access to coverage, giving all interested
stakeholders awareness of state operations impacting this particularly
vulnerable population.
Recommendation for Protecting Rural Medicaid Beneficiaries
Medicaid plays a crucial role in helping millions of people with
disabilities and functional impairments meet their medical and self-
care needs through long-term services and supports (LTSS). Millions of
Americans of all ages rely on LTSS because they live with physical,
cognitive, and/or mental disabilities that challenge their ability to
care for themselves. The importance of these services is even more
apparent for rural Americans.\27\
---------------------------------------------------------------------------
\27\ https://rupri.org/wp-content/uploads/Rural-Long-Term-Services-
and-Supports-Primer-for-Rural-America.pdf.
Congress should protect rural Medicaid beneficiaries by
protecting LTSS as a critical link between the most vulnerable rural
Americans and their health. The number of Americans requiring LTSS is
also projected to increase significantly between 2020 and 2060.\28\
More Americans who require assistance with daily living activities due
to chronic illnesses, disabilities, or aging are going to rely on LTSS
to maintain and improve the health and well-being.
---------------------------------------------------------------------------
\28\ https://www.phinational.org/policy-research/key-facts-faq/.
---------------------------------------------------------------------------
Conclusion
AHIP and our members appreciate the Committee's attention on ways to
strengthen the nation's rural health care infrastructure and how
Congress can partner with stakeholders to overcome key challenges for
rural Americans. We look forward to working with Committee members and
staff on solutions to enhance the health and protect the coverage of
rural Americans.
______
Air Methods Corporation
5500 S. Quebec Street
Greenwood Village, CO 80111
303-792-7400
https://www.airmethods.com/
Statement of Jaelynn Williams, CEO
On behalf of Air Methods, one of the leading emergency air medical
providers in the country, I would like to submit a statement for the
record to the Senate Finance Committee for the hearing ``Rural Health
Care: Supporting Lives and Improving Communities.'' Air Methods
provides emergency air medical services in 48 states. We currently
operate 276 bases and over 400 air medical aircraft, staffed by
approximately 5,000 medics, nurses, pilots, mechanics, and patient
advocates. We proudly serve patients experiencing medical emergencies
around the country, mostly in rural and highly rural locations.
Rural America is facing a growing health care crisis. More than 46
million Americans, or 15 percent of the U.S. population, live in rural
areas as defined by the U.S. Census Bureau. Americans living in rural
communities face numerous health challenges and disparities compared to
their urban counterparts. Geographic distances, limited resources,
rising infrastructure costs, and physician shortages often impede the
delivery of timely and comprehensive care. More than one hundred rural
hospitals have closed in the past decade, and hundreds of others are at
risk. In most cases, the closure of these hospitals has resulted in the
loss of the emergency department, and residents of the community must
now travel much farther when they have a life-threatening event. Over
the past few years, as the health care industry has faced labor
shortages and continued resource challenges, we have seen a dramatic
increase in demand for our services in rural America.
It is no exaggeration to say that air ambulance transport has become a
lifeline to trauma care for millions of Americans, who can easily find
themselves a long way from a medically appropriate trauma center when
time is of the essence. Additionally, many rural hospitals are often
unable to provide the necessary care due to the severity of the injury
or illness, and the patient must be transferred to a higher level of
care. Because of the sheer distance to that higher-level facility, such
as a stroke center, cardiovascular center, trauma center, or
neurosurgery center, these patients must be transported by air
ambulances to receive the medically necessary specialty care in a
timely way. Notably, the clinical care that can be provided to the
patient on the air ambulance typically far exceeds the care that could
be provided by a ground ambulance transport.
In 2023, our crews transported more than 100,000 individuals across the
country. Of those, 40% were Medicare beneficiaries who were
experiencing life threatening conditions such as head trauma, stroke,
and cardiac events, and 60% were in rural America. For example, last
year we transported a 77-year-old individual from Pagosa Springs
Medical Center in Pagosa Springs, CO, a beautiful small town surrounded
by the San Juan Mountains with a population of 1,700, to University of
Colorado Health Memorial Central in Colorado Springs, CO to the cardiac
unit--60 minutes air versus 500 minutes by ground. In some states where
access is more challenging for rural Americans, the majority of our
transports are from rural areas. For example, in Idaho 75% of our
transports were in rural areas and in Tennessee 71% were in rural
communities and transported to higher-level facilities typically
located in urban areas. In all cases, the decision to transport the
patient to the closest, most appropriate facility for care is made by
the attending physician or the first responder. Air medical crews never
self-dispatch, and when they transport a patient, they do not know, and
they do not ask, what type of insurance coverage the patient has.
Unfortunately, the emergency air ambulance industry is facing
significant challenges when it comes to reimbursement for our services.
The current Medicare reimbursement rate for air medical services is
determined by the air ambulance fee schedule. CMS first established the
air ambulance fee schedule in 2002 and it has not been updated since,
despite significant increases in operating costs due to safety and
clinical investments, inflationary costs, and regulatory requirements.
Today, we estimate that the average Medicare reimbursement only covers
50% of actual transport costs. At the same time the percentage of
Medicare patients transported has increased to almost 40% of all
transports, and the percentage of Medicaid patients transported has
increased to about 28%, putting a huge strain on the ability of air
medical providers to continue operations in many parts of the country.
This has been compounded by the recent tremendous inflationary and
economic pressures on the health care system. This has resulted in
bases closures, with more expected unless the Medicare reimbursement is
fixed.
Fortunately, bipartisan, bicameral legislation has been introduced by
Senators Michael Bennet and Marsha Blackburn, and Representatives Ron
Estes and Suzan DelBene that would preserve emergency air medical
services. To ensure seniors, Americans living in rural areas, and
patients in need of emergency care have access to air medical services,
the Protecting Air Ambulance Services for Americans Act (S. 1803/H.R.
3691) would create the path to updating the Medicare fee schedule for
these critical services. Specifically, the bill authorizes CMS to
update the Medicare Fee Schedule using data collected through the No
Surprises Act passed in 2020. Additionally, the bill requires air
ambulance providers to submit additional data on the operational costs
of air medical services and requires the Government Accountability
Office to issue a report on the costs associated with providing air
ambulance services for Medicare beneficiaries.
In conclusion, air medical services are often the difference between
life and death for rural Americans. We urge Congress to pass The
Protecting Air Ambulance Services for Americans Act to ensure that
people in rural and remote communities are not left behind and will
continue to have access to critical care.
______
Alliance for Home Dialysis
750 9th Street, NW, Suite 650
Washington, DC 20001
(202) 466-8700
The Alliance for Home Dialysis (Alliance) appreciates the opportunity
to offer comments specifically regarding home dialysis in rural
settings. We, a coalition of kidney dialysis stakeholders representing
individuals with kidney failure, clinicians, and providers, have united
to advocate for policies that promote and advance treatment choices in
dialysis care while addressing systemic barriers limiting access to the
numerous benefits of home dialysis.
Home dialysis primarily utilizes two modalities: peritoneal dialysis
(PD) and home hemodialysis (HHD). Recognized as a vital treatment
option, home dialysis provides individuals with kidney failure
significant quality of life advantages, including meaningful
improvements in physical and mental health. Moreover, it offers
lifestyle benefits such as increased time for family, hobbies, and
work, as patients are freed from the necessity of traveling to a
clinic--the average end-stage kidney disease (ESKD) patient spends as
much as 5 hours per session, with three sessions each week.
This freedom home dialysis offers is particularly advantageous for
rural patients who often face lengthy journeys to dialysis centers.
Telehealth is especially important for these patients; home dialysis
patients are able to do their monthly visit with their nephrologist
from home, thereby avoiding additional travel to doctors' offices. And,
most home dialysis machines are equipped with software to remotely
monitor the patient, feeding information to their clinical team in
real-time. Moreover, for many patients, regardless of their location,
home dialysis can lead to reduced medication requirements, improvements
in neuropathy, better sleep, increased energy levels, and the ability
to resume traveling or take vacations with family while bringing along
dialysis supplies. Given the substantial benefit of home dialysis, we
urge Members of Congress to address barriers that hinder access to home
training and therapy.
Kidney Disease Education
It is crucial that chronic kidney disease (CKD) patients have access to
the information they need to make informed decisions regarding their
kidney care journey. Currently, Medicare covers up to 6 sessions of
kidney disease education services for Stage 4 CKD patients. The benefit
is currently underutilized, and we believe that policy changes could
help to increase access to this important benefit. First, the Alliance
supports eliminating patient cost-sharing \1\ in an effort to make KDE
more affordable. We also support expanding eligibility \2\ through CKD
Stages 3b and 5 so that more of the applicable patient population will
be able to take advantage KDE. Finally, we support allowing dialysis
facilities to provide KDE, with appropriate guardrails. Guardrails must
be deployed to prevent patient steering and marketing, the substance of
the education should just be clinical education, not information
specific to a certain provider or advertising information. CMS should
also play a role in approving educational materials or modules before
they are deployed. We believe that all of these changes will increase
the number of patients able to access KDE, which will then increase
patient choice--including the choice to elect home dialysis.
---------------------------------------------------------------------------
\1\ Currently, Medicare beneficiaries are responsible for the 20%
copay associated with KDE as a Part B benefit. For some beneficiaries,
the 20% coinsurance is prohibitive to accessing these important
educational services.
\2\ Eligible providers of care are limited to physicians, nurse
practitioners, physician assistants, clinical nurse specialists, and
``other providers'' (defined as hospitals, critical access hospitals,
skilled nursing facilities, comprehensive outpatient rehabilitation
facilities, home health agencies or hospices).
---------------------------------------------------------------------------
Strengthen the Workforce
Especially impactful in rural communities, labor shortages persist in
the dialysis workforce; inadequate payment updates worsen the problem.
Labor shortages affect patient care across the health care system. A
survey conducted by a leading ESRD patient advocacy organization found
nearly two-thirds of patients reported the recent labor shortage had
impacted their care, with many experiencing treatment delays.\3\
Providers are grappling with higher labor expenses to attract, retain,
and train caregivers with the necessary skills for dialysis treatments.
The inadequate increase in the ESRD PPS base rate exacerbates this
issue. We urge CMS to bolster payments and request Congressional
attention to this matter. Additionally, we support the development of a
legislative proposal to allow reimbursement for staff-
assisted home dialysis, provided healthcare workforce shortages are
addressed.
---------------------------------------------------------------------------
\3\ Williams, Jackson. (2023). Contributor: Medicare's Leadership
Needs to Confront Our Shrinking US Workforce. American Journal of
Managed Care. https://www.ajmc.com/view/contributor-medicare-s-
leadership-needs-to-confront-our-shrinking-us-workforce.
---------------------------------------------------------------------------
Remove Barriers to Home Dialysis for AKI Patients
The Alliance has a long track record of advocating for access to home
dialysis for acute kidney injury (AKI) patients, including comments to
CMS' proposed ESRD Prospective Payment System (PPS) Rules. Given the
clinical and quality of life benefits associated with home dialysis,
mentioned above--exponentially impactful for rural patients--the
Alliance urges lawmakers to ensure that home modalities be enabled for
AKI patients after hospital discharge when their providers agree that
the modality is the best treatment option for the patient's case. While
not every AKI patient is an appropriate candidate for home therapy, all
patients deserve the opportunity to work with their doctor to determine
a treatment path that is not limited by payment restrictions on certain
modalities.
Stabilize PD Catheter Insertion Procedures
Timely placement of PD catheters faces systemic barriers, including
inadequate physician training and operating room availability. We
believe Congress should direct CMS to provide stronger incentives for
PD catheter placement, potentially through reimbursement adjustments.
Equalizing reimbursement for PD catheters and vascular access
procedures could increase home dialysis uptake, and we encourage CMS
and Congress to explore this concept.
In conclusion, we are prepared to actively engage with lawmakers on
efforts to enhance the lives of CKD and ESKD patients in rural and
underserved areas. We encourage you to see the Alliance and our members
as eager partners, ready to bring our expertise and resources to the
table for these crucial initiatives. Thank you for your attention to
the unique needs of rural Americans.
Alliance for Rural Hospital Access
The McDermott Building
500 North Capitol Street, NW
Washington, DC 20001
https://ruralhospitalaccess.org/
May 20, 2024
The Honorable Ron Wyden
Chairman
U.S. Senate
Committee on Finance
219 Dirksen Senate Office Building
Washington, DC 20510
Dear Chairman Wyden:
The Alliance for Rural Hospital Access (ARHA, or the Alliance) thanks
you for your commitment to improving rural health care and is pleased
to submit this statement for the record following the committee's May
16, 2024 hearing titled Rural Health Care: Supporting Lives and
Improving Communities.
The Alliance is comprised of hospitals designated as Medicare-Dependent
Hospitals (MDHs), Sole Community Hospitals (SCHs) and Rural Referral
Centers (RRCs) under the Medicare program. MDHs, SCHs and RRCs provide
rural populations with local access to a wide range of health care
services. In doing so, they localize care, minimize the need for
further referrals and travel, and provide services at costs lower than
their urban counterparts. These hospitals also commonly establish
satellite sites and outreach clinics to provide primary and emergency
care services to surrounding underserved communities, a function which
is becoming increasingly important as economic factors force many small
rural hospitals to close.
Background on Rural Hospital Designations
Medicare Dependent Hospitals: The MDH program was established by
Congress with the intent of supporting small rural hospitals for which
Medicare patients make up a significant percentage of inpatient days
and discharges. Because they primarily serve Medicare beneficiaries,
MDHs rely heavily on Medicare reimbursement to sustain hospital
operations. Consequently, these hospitals are more vulnerable to
inadequate Medicare payments than other hospitals because they are less
able to cross-subsidize inadequate Medicare payments with more generous
payments from private payers. As such, Congress acknowledged the
importance of Medicare reimbursement to MDHs and established special
payment protections to buttress these hospitals. Congress recognized
that if these hospitals were not financially viable and failed,
Medicare beneficiaries would lose an important point of access to
hospital services. To qualify as an MDH, a hospital must be (1) located
in a rural area, (2) have no more than 100 beds, and (3) demonstrate
that Medicare patients constitute at least 60 percent of its inpatient
days or discharges.
Sole Community Hospitals: Congress created the SCH program to maintain
access to needed health services for Medicare beneficiaries in isolated
communities. The SCH program ensures the viability of hospitals that
are geographically isolated and thus play a critical role in providing
access to care. Hospitals qualify for SCH status by demonstrating that
because of distance or geographic boundaries between hospitals they are
the sole source of hospital services available in a wide geographic
area. There are a variety of ways in which hospitals can qualify for
SCH status, but the majority qualify by being more than 35 miles from
another provider.
Rural Referral Centers: Congress established the RRC program to support
rural hospitals that treat a large number of complicated cases and
function as regional referral centers. Generally, to be classified as
an RRC, a hospital has to be physically located outside a Metropolitan
Statistical Area (indicating an urban area) and either have at least
275 beds or meet certain case-mix or discharge criteria.
Challenges Facing MDHs, SCHs and RRCs
MDHs, SCHs and RRCs are often the sole source of care within and around
a community. Many patients who live in rural communities depend on
these facilities for a full complement of health care services, from
primary care to sophisticated inpatient treatment. More and more rural
hospitals are struggling and closing, causing access problems for
residents of rural communities. When an MDH, SCH or RRC closes, the
consequences for the community may be graver than otherwise.
According to data on rural hospital closures \1\ compiled by the Cecil
G. Sheps Center for Health Services Research (or Sheps Center), there
have been 199 rural hospital closures and conversions since January
2005. This number includes 101 complete closures, 10 rural emergency
hospital (REH) conversions, and 88 converted closures (defined as
facilities no longer providing inpatient services but continuing to
provide some health care services such as primary care or long-term
care). Many more are paring unsustainable service lines, like
obstetrics. The U.S. Government Accountability Office (GAO) found \2\
that when rural hospitals close, people living in areas who receive
care from them must travel farther to get the same services--about 20
miles farther for common services like inpatient care, and about 40
miles for less common services like alcohol or drug abuse treatment.
Further, according to 2023 data \3\ from the Center for Healthcare
Quality & Payment reform, more than 600 rural hospitals--nearly 30% of
all rural hospitals in the country--are at risk of closing because of
the serious financial problems they are experiencing.
---------------------------------------------------------------------------
\1\ https://www.shepscenter.unc.edu/programs-projects/rural-health/
rural-hospital-closures/.
\2\ https://www.gao.gov/assets/gao-21-93.pdf.
\3\ https://chqpr.org/downloads/
Rural_Hospitals_at_Risk_of_Closing.pdf.
Hospitals in rural communities often confront extremely difficult
financial circumstances and tend to have negative or very small
operating margins, making them increasingly vulnerable. Additional
Medicare reimbursement reductions impose further financial strain,
compromising rural hospitals' ability to serve their communities. These
hospitals also often do not have the same flexibility as other
hospitals to discontinue lower margin or unprofitable services, like
mental health services. As mission driven organizations, and the only
source of hospital services for their community, rural hospitals often
will continue to offer services, even at great financial loss, because
there are no other providers offering those services.
Recommendations for Committee Action
Congress has repeatedly reconfirmed its commitment to MDHs, SCHs and
RRCs over the years by providing new protections to ensure their
viability in rural communities. ARHA and its members share this goal of
ensuring that federal hospital payment policies recognize the unique
role and contributions these hospitals bring to the Medicare program
and its beneficiaries.
As part of your efforts to support and improve rural health, the
Alliance requests that the Committee on Finance consider and advance
legislation that would:
Permanently extend the MDH program and low-volume hospital
payment adjustment
Update the base years for SCHs and MDHs paid on the basis of
their hospital-specific rate
Address rural health care workforce shortages by ensuring SCHs
and MDHs paid using their hospital-specific rate receive indirect
medical education (IME) adjustments, to encourage these hospitals to
localize resident training in rural areas
Reimburse rural hospitals fairly for uncompensated care by
ensuring SCHs and MDHs paid on the basis of their hospital-specific
receive a Medicare disproportionate share hospital (DSH) payment
adjustment and an uncompensated care pool allocation
Direct the Centers for Medicare and Medicaid Services (CMS) to
extend rural SCH site-neutral exemptions to urban SCHs and MDHs
Direct CMS to extend the rural SCH 7.1% payment adjustment to
urban SCHs, and to study the appropriateness of making a similar
payment adjustment for MDHs
Ensure that any congressional efforts to enact additional site-
neutral payment policies include appropriate exceptions that protect
financially-vulnerable SCHs and MDHs, recognizing the unique role these
facilities have in their communities
Permanently Extend the MDH Program and Low-Volume Adjustment
The MDH program and the low-volume hospital payment adjustment are
support mechanisms that were created by Congress decades ago, and have
traditionally been reauthorized together for limited periods. The
current authorization runs through December 31, 2024, requiring
Congress to enact another extension before the end of the 118th
Congress.
A permanent extension of these critical programs would bring more
predictability and consistency to the rural hospitals that rely upon
these payments to remain financially viable. This stability is often
lacking with short-term extensions, given that hospitals cannot factor
these payments into their budgets for the years in which they are due
to expire. This concern was raised by Senator Chuck Grassley (R-IA)
during the hearing, and Dr. Keith Mueller agreed, stressing that rural
hospitals should not have to expend limited time and resources working
through the budgetary implications of the potential expiration of these
programs and worrying about what will happen if the funding runs out.
The Alliance strongly supports the Rural Hospital Support Act (S.
1110), legislation reintroduced earlier this year by Senators Bob Casey
(D-PA) and Grassley that would permanently extend the MDH program and
low-volume adjustment.
Enacting the provisions of S. 1110 well in advance of the December 31,
2024, deadline would provide vulnerable hospitals with more predictable
Medicare reimbursements and greater financial stability, and we urge
the committee to take up these provisions at its earliest convenience.
Update the Base Years for SCHs and MDHs
S. 1110 contains additional provisions that would better enable SCHs
and MDHs to continue to provide high quality, cost-efficient care to
the rural populations they serve.
Under Medicare's Inpatient Prospective Payment System (IPPS), SCHs and
MDHs are paid the greater of the federal rate (i.e., the payment that
the hospital would otherwise receive under the IPPS) or a cost-based
payment, which is determined by adding together the federal payment
rate applicable to the hospital and the amount that the federal payment
rate is exceeded by a hospital-specific rate (in the case of MDHs, the
hospital receives 75% of that difference).
Hospital-specific rates are tied to a hospital's costs in a specified
year. For SCHs, the years are 1982, 1987, 1996 or 2006, and for MDHs,
the years are 1982, 1987 or 2002. These years are overdue to be
updated, and S. 1110 would provide for a more recent base year for both
SCHs and MDHs. We encourage the committee to advance these provisions
as well.
Advance Workforce Legislation that Provides Fair IME Adjustments to
SCHs and MDHs
Rural health care workforce shortages are well-documented, and Alliance
hospitals can help alleviate physician shortages if they have adequate
resources. Specifically, SCHs and MDHs are well-situated to host
residency programs, but SCHs and MDHs paid on the basis of their
hospital-specific rate (as detailed above) are financially
disincentivized to establish such programs.
If a hospital paid on the basis of the federal (or IPPS) rate initiates
a teaching program, it receives both Direct Medical Education (DME) and
IME payments. While SCHs and MDHs paid on the basis of their hospital-
specific rate do qualify to receive DME payments, they do not receive
IME payments.
SCHs and MDHs--which comprise nearly 80% of hospitals eligible to
establish training programs in rural communities--should receive the
same incentives and financial buffer as hospitals paid under the
federal rate. Based on CMS cost report data, 58% of SCHs and 46% of
MDHs are paid on the basis of their hospital-specific rate. This
formula for SCHs and MDHs should not disqualify the hospital from
receiving full IME payments as they would under the federal rate
formula. This full federal funding of DME and IME payments is necessary
to establish and operate rural-based residency training programs.
During the hearing, Senator Catherine Cortez Masto (D-NV) raised the
issue of ensuring that SCHs and MDHs paid on the basis of their
hospital-specific rate receive IME adjustments, and Dr. Mueller agreed
that SCHs and MDHs that train residents should receive fair incentives,
and that addressing this gap in Medicare payment is one policy lever
that would help address rural workforce shortages.
The Alliance has repeatedly asked CMS to use its authority to make this
adjustment, but CMS has declined to take action. As such, in order for
this policy to be advanced, the Alliance encourages the committee to
include it in any rural health/workforce package it considers this
Congress.
Advance Legislation to Equitably Reimburse SCHs and MDHs for
Uncompensated Care
Similarly, if a hospital paid on the basis of the federal rate serves a
disproportionate number of low-income patients, it receives an
increased payment under the Medicare DSH payment adjustment, along with
an uncompensated care pool allocation. However, DSH-eligible SCHs and
MDHs that are paid under the hospital-specific rate do not receive
hospital-specific payment adjustments to compensate them for
uncompensated care.
This highlights another inequity that exists between the two payment
mechanisms, and this discrepancy continues to undermine the viability
of rural safety net hospitals. SCHs and MDHs that are paid under the
hospital-specific rate should receive the same financial protections if
they have high rates of uncompensated care, through the receipt of a
DSH payment adjustment and an uncompensated care pool allocation.
Providing SCHs and MDHs with equitable and appropriate compensation
will allow for greater financial stability for these important safety
net hospitals, so they can continue sustaining their communities.
Again, the Alliance has repeatedly asked CMS to use its authority to
fix this inequity, but CMS has declined to act. The Alliance therefore
urges the committee to consider this inequity when crafting legislation
to protect and sustain access to rural health care.
Direct CMS to Extend Rural SCH Site-Neutral Exemptions to Urban SCHs
and MDHs
Under the Medicare outpatient prospective payment system (OPPS), CMS
pays a ``PFS-equivalent'' rate of 40 percent of the OPPS payment rate
for hospital outpatient clinic visits coded under HCPCS G0463 when
delivered by a previously excepted off-campus provider-based
department. Beginning in CY 2023, CMS now exempts from this payment
reduction services furnished by excepted off-campus provider-based
departments of rural SCHs.
For years, the Alliance has been urging CMS to reconsider the site
neutral policy, and to exempt SCHs and MDHs from it. While we were
pleased that CMS determined to exempt rural SCHs, we were dismayed that
the agency did not extend the same relief to urban SCHs and MDHs. These
hospitals are similarly disadvantaged by the site neutral policy;
Congress should direct CMS to provide a similar exemption.
CMS uses Metropolitan Statistical Areas (MSAs) to delineate between
urban and rural areas. While the Alliance appreciates the need to
distinguish urban and rural for a number of payment and policy
mechanisms, MSAs are an imprecise tool for differentiating urban and
rural areas. Given that MSAs use counties as building blocks, many
areas are designated as ``urban'' because they have a single urbanized
area. But if the county is unusually large, significant portions of
that county may be as rural as the most isolated frontier area. Using
MSAs to identify urban and rural areas is particularly problematic in
the western United States where there are many very large counties that
comprise MSAs (see, for example, San Bernardino County in California
and Flagstaff and Pima Counties in Arizona).
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
There are instances where an SCH is designated urban by CMS, but
the hospital is actually a considerable distance from the nearest
urbanized area. Verde Valley Medical Center (Provider Number 03-0007),
for example, is located in Prescott, AZ and is considered an urban SCH.
However, the closest urbanized area with more than 40,000 people is
Flagstaff, AZ, which is nearly 100 miles away.\4\ Verde Valley has
undergone an urban-to-rural reclassification, so it is eligible for
these protections. Hospitals like Methodist Hospital South (45-0165) in
Jourdanton, Texas have not undergone urban-to-rural reclassification,
and so are not eligible for these protections. These are not urban
areas by most reasonable standards, except the MSA standard.
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\4\ Metropolitan and Micropolitan Statistical Areas of the United
States and Puerto Rico, US Census Bureau. July 2015. https://
www2.census.gov/geo/maps/metroarea/us_wall/Jul2015/cbsa_us_0715.pdf.
For these reasons, CMS should extend this exemption to urban SCHs
because using MSAs to determine urban and rural areas is imprecise, and
distinguishing between urban and rural SCHs when applying payment
policy unfairly disadvantages urban SCHs that are the sole source of
hospital services in their communities, like their rural counterparts.
Urban SCHs are serving communities that are truly rural in character.
In fact, as CMS knows, to be an urban SCH, a hospital has to be even
further (35 miles) from another hospital to qualify than if it were a
rural hospital. CMS also can reduce incentives to undergo urban-to-
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rural reclassification to take advantage of these protections.
Regarding MDHs, GAO data shows that Medicare profit margins and total
hospital profit margins declined for MDHs from fiscal year 2011 through
2017, from -6.9 percent to -12.9 percent and 1.6 percent to -0.2
percent, respectively.\5\ The degree to which Medicare margins declined
for MDHs during this time period (6 percentage points) was greater than
the degree to which they declined for rural hospitals (3.8 percentage
points) and all hospitals (2.5 percentage points). The number of MDHs
declined 28 percent from 193 hospitals in fiscal year 2011 to 128
hospitals in 2017 as hospitals became ineligible for MDH status, and 16
closed between 2013 and 2017, or experienced other changes.\6\
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\5\ GAO, Information on Medicare-Dependent Hospitals, GAO-20-300
(Washington, DC: February, 2020). https://www.gao.gov/assets/gao-20-
300.pdf.
\6\ GAO, Rural Hospital Closures: Number and Characteristics of
Affected Hospitals and Contributing Factors, GAO-18-634 (Washington,
DC: Aug. 29, 2018). https://www.gao.gov/products/gao-18-634.
Taken together, supporting SCHs and MDHs by ensuring they receive the
site neutral exemption would help secure access to care in rural and
underserved communities. Rural SCHs, urban SCHs and MDHs are often the
sole health care providers in isolated areas where health care access
is lacking. Our analysis shows that 56 percent of rural SCHs, 73
percent of urban SCHs, and 60 percent of MDHs are located in at least
one type of medically underserved area as defined by Health Resources
and Services Administration (HRSA) Medically Underserved Area
---------------------------------------------------------------------------
designations.
------------------------------------------------------------------------
Hospital Hospitals
Hospital Type Count in MUA Percent
------------------------------------------------------------------------
Rural Sole Community Hospital 448 251 56%
-------------------------------------
Urban Sole Community Hospitals 77 33 43%
redesignated as rural under Sec.
412.103
-------------------------------------
Urban Sole Community Hospitals (not 15 11 73%
redesignated as rural)
-------------------------------------
\7\ A hospital is determined to be
in a Medically Underserved Area
(MUA) if the hospital's main
address meets the requirement of at
least one MUA designation type
based on either geographic area,
specific population characteristics
of that geographic area (i.e.,
homeless population), or a
governor's designation. For detail,
please refer to the Health
Resources and Services
Administration website: https://
bhw.hrsa.gov/workforce-shortage-
areas/shortage-designation.
Medicare Dependent Hospital 169 102 60%
------------------------------------------------------------------------
M+ Analysis of Medically Underserved Area (MUA)\7\ designations from
HRSA.
The Alliance shared this analysis and recommendations with CMS in the
2023 rulemaking cycle. CMS declined to make the recommended changes,
relying on a 2005 study of resource costs that found higher resource
costs in rural SCHs, and noting that the 2003 legislation that required
that 2005 study demonstrated that ``Congress did not determine that any
of these hospital types required additional payments for outpatient
services.''
For these reasons, the Alliance encourages the committee to direct CMS
to extend rural SCH site-neutral exemptions to urban SCHs and MDHs.
Direct CMS to Extend the Rural SCH 7.1% Payment Adjustment to Urban
SCHs, and Study the Appropriateness of Making a
Similar Payment Adjustment for MDHs
Under current CMS policy, Medicare payments to rural SCHs for
outpatient services are increased by 7.1 percent. CMS makes this
adjustment because it found that, pursuant to a study required by
Congress,\8\ compared to urban hospitals, rural SCHs have substantially
higher costs, and need a payment adjustment to be comparably treated
under the OPPS.
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\8\ Sec. 411(b), Pub. L. No. 108-173.
For the reasons set forth in the previous section, the Alliance has
continually urged CMS to extend the rural SCH 7.1% payment adjustment
to urban SCHs as well, and to study the appropriateness of making a
similar payment adjustment for MDHs. CMS has not made these changes,
and has stated that it does not have the authority to do so because
---------------------------------------------------------------------------
Congress specified that the policy apply to rural hospitals.
As noted above, CMS uses MSAs to delineate between urban and rural
areas, though MSAs are not the most precise tool for actually
characterizing urban and rural areas. As a result, there are instances
where an SCH is designated urban by CMS, but the hospital is actually a
considerable distance from the nearest urbanized area.
By specifying that the 7.1% adjustment applies to all SCHs, as well as
MDHs, Congress can provide another mechanism to contribute to increased
financial stability for rural hospitals. As such, we urge the committee
to clarify Congress' intent with respect to these adjustments.
Protect MDHs and SCHs from Site-Neutral Payment Reductions
As noted throughout these comments, MDHs and SCHs are in dire financial
straits. More cuts will force further closures. The Alliance concurs
that payment policies could be refined to better align payment
incentives and protect beneficiaries, but we also encourage Congress to
balance beneficiary financial protection with beneficiary access to
care.
Site neutral payment reforms would be in part intended to motivate
provider behavioral changes--i.e., services previously provided in
hospital outpatient departments (HOPDs) that can be safely performed in
ambulatory surgical centers (ASCs) or physician offices would migrate
to those settings when payments are aligned. However, lawmakers should
not expect providers in rural areas to be able to respond as intended,
as ASCs are largely located in urban areas. Rural areas typically lack
the surgical specialists needed for ASCs, and the lower population
density in rural areas makes them less attractive locations for ASCs.
The Medicare Payment Advisory Commission (MedPAC) notes that, of ASCs
that were open in 2021, 93.4% were located in urban areas, compared to
just 6.6% in rural areas. As a result, beneficiaries who do not live
near an ASC usually obtain ambulatory surgical services in HOPDs.
Further, physician offices in rural areas are less likely to be built
and equipped with the capacity to perform outpatient services likely to
be subject to site neutral payment reforms.
If rural hospitals cannot migrate surgical procedures and other
sophisticated services to ASCs or physician offices, they will endure
payment cuts without being able to respond to the intended behavioral
stimuli. SCHs and MDHs are particularly vulnerable to site neutral
payment changes. These hospitals are often the sole source of care in
their communities, and so cannot expect other hospitals to pick up
unprofitable services.
Payment policy changes that cause beneficiaries to lose access to
hospital services will not serve beneficiary or taxpayer interests. To
prevent such consequences, Congress should exempt SCHs and MDHs from
proposed site neutral policy changes.
Thank you for your consideration of the proposals set forth in this
statement. The Alliance appreciates your commitment to improving rural
health care, and we look forward to continuing to serve as a resource
to your committee staff on these efforts. Please contact me at 202-204-
1457 or [email protected] if you have any questions.
Sincerely,
Eric Zimmerman
______
Alzheimer's Association and Alzheimer's Impact Movement
655 15th St., NW, Suite 500
Washington, DC 20005
The Alzheimer's Association and Alzheimer's Impact Movement (AIM)
appreciate the opportunity to submit this statement for the record for
the United States Senate Committee on Finance hearing on Rural Health
Care: Supporting Lives and Improving Communities. The Association and
AIM thank the Committee for holding this hearing to discuss the
importance of ensuring access to life-changing therapies for the
millions of people living with rare, progressive, and serious diseases,
such as Alzheimer's and other dementia, and ensuring that access to
those treatments reaches rural communities.
Great progress has been made in advancing Alzheimer's and dementia
research, providing hope to families in the midst of a terrible, fatal
disease. Now that the Food and Drug Administration (FDA) has approved
Alzheimer's treatments to slow progression at an early stage, it's
lifted that hope higher. However, people living with Alzheimer's and
other dementia face unique health care challenges, and often primary
care providers are the first clinicians with whom individuals discuss
cognition concerns.
Nearly 7 million Americans are living with Alzheimer's, and by 2050
this number is expected to rise to nearly 14 million. Alzheimer's is
one of the costliest conditions in the U.S. In 2024, Alzheimer's and
other dementia are projected to cost the nation $360 billion. By 2050,
these costs could rise to nearly $1 trillion. Only half of those living
with Alzheimer's disease are diagnosed and, of those, only half are
told of their diagnosis. The value of an accurate and early diagnosis
cannot be ignored; it can significantly improve an individual's quality
of life and could save up to $231 billion in 2050 in medical and care
costs.
Rural communities often report higher prevalence rates of dementia
compared to urban counterparts, despite multiple studies indicating
Alzheimer's and related dementias are undersigns in rural communities.
Higher prevalence may be due to elevated exposure to potential risk
factors like obesity/smoking, older average populations, limited access
to health care services (e.g., distance to hospitals, number of
ambulances), and socioeconomic challenges such as a lack of healthy,
affordable food options. Timely detection and accurate diagnosis of
Alzheimer's or another dementia allows people to access medical,
social, emotional, financial, and legal benefits sooner, and for
patient and family preferences to drive health care decisions. Even
though the vast majority (85 percent) of initial diagnoses are made by
primary care physicians, nearly 40 percent reported that they were
``never'' or ``only sometimes'' comfortable making a diagnosis of
Alzheimer's or another dementia. Seventy-one percent of rural primary
care providers reported that there were not enough geriatricians and
other specialists in their area, compared to 44 percent of primary care
providers in large cities and 54 percent in urban areas. Project ECHO,
discussed below, can equip primary care providers to effectively
diagnose patients and provide needed care based on the results.
Healthy People 2020 has stated that Alzheimer's and other dementia are
more often undiagnosed in rural and minority populations, and studies
suggest that dementia is diagnosed less frequently in rural areas than
in metropolitan areas. Studies also suggest that individuals with
Alzheimer's and related dementia have a higher mortality rate in these
areas and that individuals living with dementia in rural areas receive
suboptimal care.
Quality care delivered by trained providers leads to better health
outcomes for individuals and caregivers and puts less strain on health
systems. Yet, too often overburdened primary care providers are unable
to access the latest patient-centered dementia training. There is a
need to fill the gaps being felt by primary care providers, and Project
ECHO and the Accelerating Access to Dementia and Alzheimer's Provider
Training (AADAPT) Act can help fill that gap.
Project ECHO
Project ECHO, a video-conference-based continuing education program,
improves health outcomes while reducing geographic barriers and the
cost of care through a team-based approach. Project ECHO is a global
movement with over 900 ECHO programs across 193 countries to improve
access to high quality care for over 74 health conditions and other
categories (Project ECHO 2022 Annual Report). It has been widely
studied and shown to be an effective educational tool and practice
improvement initiative that can improve provider skills, knowledge, and
confidence to better manage common, complex disease conditions in the
primary care environment. Evidence also suggests that Project ECHO can
improve patient outcomes, reduce costs of care, and save patients the
burden and cost of traveling to seek out specialty care. Alzheimer's
and dementia Project ECHO programs have successfully provided
continuing education through interactive, case-based video sessions,
and have brought this training to rural and medically underserved areas
where primary care providers are especially strained. We are longtime
advocates and supporters of Project ECHO, including endorsing the ECHO
Act (Pub. L. 114-270), and supporting $15 million in appropriations
funding for project ECHO in FY25.
The Accelerating Access to Dementia and Alzheimer's Provider Training
(AADAPT) Act
The AADAPT Act (H.R. 7688/S. 4276), introduced by Senators Klobuchar
(D-MN) and Capito (R-WV) would provide virtual dementia education and
training to empower primary care providers to better diagnose
Alzheimer's and other dementia and deliver high-quality, person-
centered care in community-based settings. The bill would build upon
the current Project ECHO program to provide grants specifically for
Alzheimer's and dementia Project ECHOs to address the knowledge gaps
and workforce capacity issues primary care providers face given the
increasing population living with Alzheimer's disease and other
dementia. This increases access to specialty care for all while
decreasing disparities in access to treatment. It also increases
consistency in care across providers, the knowledge of providers, and
the confidence primary care providers have to treat patients with
Alzheimer's and other dementias. This bill expands access to ensure
that more people in underserved and rural areas are able to access
treatment from providers they trust in their own communities.
Conclusion
Quality care from providers leads to better health care outcomes, but
there are currently many disparities among who receives this care.
Project ECHO and the AADAPT Act work to close those gaps and provide
life changing treatment, detection, and diagnosis training to primary
care providers so they can better serve their communities--especially
in rural and frontier areas. This bill is essential to work to close
the treatment access gap felt in rural communities across the country.
The Alzheimer's Association and AIM appreciate the steadfast support of
the Committee and its continued commitment to issues important to the
millions of families affected by Alzheimer's disease and other
dementia. We look forward to working with you in a bipartisan way to
ensure that rural communities are able to have access to prevention
methods, detection, diagnosis, and treatment for Alzheimer's and other
dementia.
______
American Academy of Family Physicians
1133 Connecticut Avenue, NW, Suite 1100
Washington, DC 20036-1011
202-232-9033
Fax: 202-232-9044
https://www.aafp.org/
Statement of Tochi Iroku-Malize, M.D., MPH, MBA, FAAFP,
Board Chair
Dear Chairman Wyden and Ranking Member Crapo:
On behalf of the American Academy of Family Physicians (AAFP),
representing more than 130,000 family physicians and medical students
across the country, I write to thank you both for your bipartisan
leadership to address issues impacting family physicians and their
patients through this hearing entitled ``Rural Health Care: Supporting
Lives and Improving Communities.''
The AAFP strongly agrees with Chairman Wyden's assessment in his
opening statement that the United States must boost up primary care,
which is ``the backbone and front line of American health care and
often experiences the greatest shortage of'' clinicians. Senator
Lankford also acknowledged in his opening statement that rural health
care is not just delivered in hospitals, but in a variety of settings--
including independent family physician practices, which he explicitly
mentioned.
Rural Americans often face greater socioeconomic barriers, such as
higher poverty rates and lack of reliable transportation, than their
average urban counterparts. They tend to be older and sicker, have a
higher incidence of poor health outcomes, and are more likely to engage
in risky behaviors such as substance use and smoking. Individuals in
rural areas are also more likely to die from heart disease, cancer,
unintentional injury, chronic lower respiratory disease, and stroke as
well as COVID-19.\1\, \2\
---------------------------------------------------------------------------
\1\ U.S. Centers for Disease Control and Prevention, ``About Rural
Health.'' Updated May 9, 2023. Accessed September 21, 2023. Available
online at: https://www.cdc.gov/ruralhealth/about.html.
\2\ National Institute for Health Care Management, ``Rural Health
During the Pandemic: Challenges and Solutions to Accessing Care.''
February 24, 2022. Accessed September 21, 2023. Available online at:
https://nihcm.org/publications/rural-health-during-the-pandemic.
They also face significant barriers and challenges to accessing high-
quality, comprehensive health care. Rural residents are more likely to
be uninsured and are more likely to report difficulty obtaining needed
health care than their urban counterparts, largely due to the limited
number of clinicians and facilities in their area.\3\, \4\
Rural hospitals have closed at an alarming rate over the last 10 years,
and many rural populations face long travel times for primary and
emergency care. Additionally, while many patients benefited from new
telehealth flexibilities due to the COVID-19 public health emergency
(PHE), rural individuals were less likely to have broadband access and
therefore less likely to connect via video for virtual visits.\5\
---------------------------------------------------------------------------
\3\ Day JC, ``Rates of Uninsured Fall in Rural Counties, Remain
Higher Than Urban Counties,'' United States Census Bureau. April 9,
2019. Available online at: https://www.census.gov/library/stories/2019/
04/health-insurance-rural-america.html.
\4\ Shirey L, ``Challenges for the 21st Century: Chronic and
Disabling Conditions--Rural and Urban Health,'' Georgetown University.
Accessed September 21, 2023. Available online at: https://
hpi.georgetown.edu/rural/
#::text=Rural%20residents%20are%20also%20more,tests%20
for%20various%20chronic%20conditions.
\5\ Federal Communications Commission, ``2019 Broadband Deployment
Report,'' May 2019. Available at: https://www.fcc.gov/reports-research/
reports/broadband-progress-reports.
The AAFP has long advocated to improve access to high-quality care in
rural communities. Seventeen percent of our members live and work in
rural areas, the highest percentage of any medical specialty, and they
are often the only physician embedded in the community. Family
physicians are uniquely trained to provide a broad scope of health care
services to patients across the lifespan. This enables them to tailor
their practice location and individual scope of practice to the needs
of their communities. As a result, family physicians are an essential
source of emergency services, maternity care, hospital outpatient
services, and primary care in rural areas. It is with these
considerations in mind that we offer the following policy
recommendations to improve health care access in rural communities.
Appropriately Paying for Primary Care in Medicare and Medicaid
Payment for primary care is undeniably a workforce issue. The amount of
money that we invest into primary care is a determining factor in
whether or not we have a sufficient workforce in place to meet the
needs of our population. However, despite spending more on health care
than any of our peer nations, only a fraction of those dollars are
spent on primary care and prevention. Specifically, only 5 to 7 percent
of our total national health care spending is on primary care.\6\ The
consequences of this underinvestment are particularly pronounced in
rural communities, which represent nearly two-thirds of primary care
health professional shortage areas (HPSAs) in the country.\7\
---------------------------------------------------------------------------
\6\ Centers for Disease Control and Prevention. National Center for
Health Statistics. Ambulatory Health Care Data. National Ambulatory
Medical Care Survey (NAMCS). 2016. https://www.cdc.gov/nchs/ahcd/
index.htm. Accessed February 9, 2023.
\7\ U.S. Department of Agriculture, ``Rural America At A Glance:
2019 Edition'' (Washington: 2019), available at https://
www.ers.usda.gov/webdocs/publications/95341/eib-212.pdf; CAP analysis
of data from U.S. Department of Health and Human Services Health
Resources and Services Administration, ``HPSA Find,'' available at
https://data.hrsa.gov/tools/shortage-area/hpsa-find.
Lower compensation dissuades prospective physicians from pursuing
primary care specialties and is one of the key drivers of financial
instability for family medicine practices across the country. As a
result, more independent primary care practices are acquiescing to
consolidation--either selling to health systems, plans, or corporate
entities for what is effectively pennies or closing their doors
entirely--while too few new physicians are entering the field to take
their place. Between 2021 and 2022, family medicine and internal
medicine physicians accounted for more than 16,000 of the 71,309
doctors who left the workforce between 2021 and 2022.\8\
---------------------------------------------------------------------------
\8\ Primary care, mental health clinician shortage jeopardizes
access, Modern Healthcare. https://www.modernhealthcare.com/labor/
primary-care-mental-health-shortage-definitive-health
care?utm_source=modern-healthcare-
alert&utm_medium=email&utm_campaign=20231016&utm
_content=hero-readmore.
In particular, the piecemeal approach fee-for-service (FFS) payment
takes to financing primary care undervalues the whole-person approach
integral to primary care and hinders the ability of family physicians
to provide care in a way that is organic and responsive to our
community. Primary care services are relatively undervalued in the
Medicare Physician Fee Schedule, which leads to further devaluation
across virtually all other payers who peg their payment rates to
---------------------------------------------------------------------------
Medicare's or use Medicare's relative values to set their rates.
The retrospective, volume-based nature of FFS also fails to account for
the costs of longitudinally managing patients' overall health. It does
not provide practices with the time and flexibility to invest in the
care management staff and population health tools that enable practices
to efficiently and effectively meet patients' individual evolving
health needs.
Rural communities are disproportionately impacted by insufficient FFS
payments and the other pressure points fueling consolidation. They have
smaller patient volumes that are older and more likely to have chronic
illnesses, multiple health concerns, and be low-income. They see higher
rates of uninsured and Medicare and Medicaid patients, meaning
significantly lower payment rates and more expensive, uncompensated
care. Because of the less-profitable patient population, studies have
indicated that market concentration is higher in low-income areas.\9\
For some small rural practices and hospitals, the effects of
consolidation may be different. Mergers and acquisition can play an
important role in preserving existing sites of care (and oftentimes,
the only site) with insufficient margins. However, it also often
results in the closure of service lines not deemed highly profitable--
including primary care--and may worsen access to care in these
communities.\10\
---------------------------------------------------------------------------
\9\ Yerramilli P, May FP, Kerry VB. Reducing Health Disparities
Requires Financing People-Centered Primary Care. JAMA Health Forum.
2021;2(2):e201573. doi:10.1001/jamahealthforum.
2020.1573.
\10\ O'Hanlon CE et al. ``Access, Quality, and Financial
Performance of Rural Hospitals Following Health System Affiliation,''
Health Affairs. December 2019. https://doi.org/10.1377/hlth
aff.2019.00918.
For these reasons, the AAFP has long advocated to accelerate the
transition to value-based care using alternative payment models (APMs)
that provide prospective, population-based payments to support the
provision of comprehensive, longitudinal primary care. We strongly
believe well-designed APMs provide primary care a path out of the
under-valued and overly burdensome FFS payment system that exists
today, and in turn will better enable the Medicare program to meet the
needs of its growing and aging beneficiary population in new and
innovative ways. Unfortunately, a dearth of primary care APMs and the
inadequacy of FFS payment rates that often underlie APMs are
undermining the transition to value-based care. Because most APMs are
designed based on FFS payment rates, modernizing FFS payment for
primary care is one essential strategy to support physicians'
---------------------------------------------------------------------------
transition into value-based care.
Physician practices that struggle to keep their doors open cannot
possibly transition into APMs or hire care managers and behavioral
health professionals. Practice transformation and quality improvement
require significant investment in practice capabilities including
technology, people, and new workflows. Therefore, the Academy continues
to urge the Committee to advance legislative solutions, including
reforms to the Medicare Access and CHIP Reauthorization Act (MACRA),
that would address unsustainable FFS payment rates for physicians and
alleviate some of the associated administrative burden for practices,
while promoting patients' access to continuous, comprehensive primary
care. This includes providing an annual inflationary update for
physician payment tied to the Medicare Economic Index and greatly
needed reforms to existing budget neutrality requirements, which pit
physician specialties against one another in a fight for scarce
resources and hinder CMS' ability to appropriately pay for all the
services a beneficiary needs.
Furthermore, Medicaid payment rates have a direct impact on patient
access to primary care. Medicaid payment is on average 66 percent of
the Medicare rate for primary care services, but it can be as low as 33
percent in some states.\11\ These low rates have historically been a
barrier to physicians accepting more Medicaid patients. Reports from
the Medicaid and CHIP Payment and Access Commission (MACPAC) show that
physician acceptance of new Medicaid patients worsens as the ratio of
Medicaid payment rates to Medicare allowances decreases.\12\ Physicians
cite low payment as the primary reason they were unable to accept
additional Medicaid patients.\13\ Managed care plans report caps on
clinicians' Medicaid patient panels and low physician participation in
Medicaid are top challenges in ensuring access to care.\14\ Medicaid
enrollees experience longer office wait times, more difficulty
scheduling visits, and both low-income patients and their physicians
report low payment rates lead to shorter, inadequate visit
times.\15\, \16\, \17\
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\11\ Zuckerman, S., Skopec, L., Aarons, J. (2021, February 01).
Medicaid Physician Fees Remained Substantially Below Fees Paid By
Medicare In 2019. https://www.healthaffairs.org/doi/abs/10.1377/
hlthaff.2020.00611.
\12\ Medicaid and CHIP Payment and Access Commission, ``Physician
Acceptance of New Medicaid Patients: Findings from the National
Electronic Health Records Survey.'' June 2021. Accessed online at:
https://www.macpac.gov/wp-content/uploads/2021/06/Physician-Acceptance-
of-New-Medicaid-Patients-Findings-from-the-National-Electronic-Health-
Records-Survey.
pdf.
\13\ Decker SL. In 2011 nearly one-third of physicians said they
would not accept new Medicaid patients, but rising fees may help.
Health Aff (Millwood). 2012 Aug;31(8):1673-9. doi: 10.1377/
hlthaff.2012.0294. PMID: 22869644; PMCID: PMC6292513.
\14\ Garfield R, Hinton E, Cornachione E, Hall C. Medicaid Managed
Care Plans and Access to Care. Kaiser Family Foundation. 2018.
Retrieved from: http://files.kff.org/attachment/Report-Medicaid-
Managed-Care-March-Plans-and-Access-to-Care.
\15\ Oostrom, T., Einav, L., & Finkelstein, A. (2017). Outpatient
Office Wait Times and Quality of Care for Medicaid Patients. Health
Affairs, 36(5), 826-832. doi:10.1377/hlthaff.2016.1478. https://
www.ncbi.nlm.nih.gov/pmc/articles/PMC5812017/.
\16\ Hsiang WR, Lukasiewicz A, Gentry M, Kim CY, Leslie MP, Pelker
R, Forman HP, Wiznia DH. Medicaid Patients Have Greater Difficulty
Scheduling Health Care Appointments Compared With Private Insurance
Patients: A Meta-Analysis. Inquiry. 2019 Jan-Dec;56:469580198
38118. doi: 10.1177/0046958019838118. PMID: 30947608; PMCID:
PMC6452575.
\17\ Lewis C, Zephyrin L, Abrams MK, Seervai S. (2019). Listening
to Low-Income Patients and Their Physicians: Solutions for Improving
Access and Quality in Primary Care. The Commonwealth Fund. https://
www.commonwealthfund.org/blog/2019/listening-low-income-patients-and-
their-physicians--improving-access-and-quality.
Meanwhile, evidence indicates patient access improved when Congress
raised Medicaid primary care payment rates to Medicare levels in 2013-
2014. One study found that appointment availability increased during
the ``primary care fee bump'' and decreased after it expired.\18\ Other
studies found the fee bump did not significantly increase physicians'
participation in the Medicaid program, likely due to the temporary
nature of the payment increase.\19\ Raising Medicaid payment for
primary care services can improve access to care for Medicaid
beneficiaries and in turn mitigate health disparities.
---------------------------------------------------------------------------
\18\ Candon M, Zuckerman S, Wissoker D, et al. Declining Medicaid
Fees and Primary Care Appointment Availability for New Medicaid
Patients. JAMA Intern Med. 2018;178(1):145-146. doi:10.1001/
jamainternmed.2017.63022.
\19\ Decker S. (2018). No Association Found Between the Medicaid
Primary Care Fee Bump and Physician Reported Participation in Medicaid.
Health Affairs. https://doi.org/10.1377/hlthaff.2018.0078.
Therefore, the Academy continues to urge Congress to pass legislation
that applies a Medicare payment rate floor to Medicaid primary care
services as a necessary step toward addressing the unsustainably low
payment rates that are exacerbating existing health disparities and
undermining patient access to essential care. However, the AAFP also
continues to emphasize that Medicare payment rates have failed to keep
up with inflation and should not be considered adequate. While Medicare
is not a perfect comparator, we believe that it is a useful starting
place because states continue to pay even lower Medicaid rates and
Medicare rates are publicly available on a national basis.
Maternal Health and Obstetric Unit Closures
The United States has one of the highest maternal mortality rates in
the developed world. Recent studies have shown that U.S. maternal
mortality rates have stagnated or even worsened over time, while rates
around the globe continue to fall.\20\ According to the World Health
Organization, maternal mortality globally declined nearly 38 percent
between 2000 and 2017.\21\ During roughly the same period, maternal
mortality in the United States increased by over 26 percent. In the
U.S., approximately 700 women a year die as a result of pregnancy or
related complications, yet the vast majority (84 percent) are
preventable.\22\ Significant disparities exist when these rates are
broken down across demographic groups, with higher rates of mortality
occurring among Black women, low-income women, and those living in
rural areas.\23\
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\20\ Fleszar LG, Bryant AS, Johnson CO, et al. Trends in State-
Level Maternal Mortality by Racial and Ethnic Group in the United
States. JAMA. 2023;330(1):52-61. doi:10.1001/jama.2023.
9043.
\21\ World Health Organization. ``Maternal mortality.'' World
Health Organization (WHO), 26 April 2024, https://www.who.int/news-
room/fact-sheets/detail/maternal-mortality. Accessed 30 April 2024.
\22\ Hill, Latoya, et al. ``Racial Disparities in Maternal and
Infant Health: Current Status and Efforts to Address Them.'' KFF, 1
November 2022, https://www.kff.org/racial-equity-and-health-policy/
issue-brief/racial-disparities-in-maternal-and-infant-health-current-
status-and-efforts-to-address-them/. Accessed 30 April 2024.
\23\ Hill, Latoya, et al.
The factors driving these disparities are complex and multi-faceted.
They include but are not limited to access to and affordability of
care, the intersection of demographic factors, and structural and
systemic bias and discrimination. For example, the closure of rural
hospitals and obstetrics programs has led to enormous gaps in access to
prenatal and perinatal services for pregnant people living in rural
communities. In addition to the loss of facilities, there are
compounding factors such as lack of transportation, increased poverty,
increased rate of chronic diseases, and difficulty recruiting and
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retaining physicians to live and work in rural communities.
Between 2011 and early 2023, 217 hospital obstetric units closed,
creating many maternity care deserts across the nation.\24\ As of 2018,
over half of all rural counties lack a hospital providing obstetric
services. Closures have been particularly focused in rural communities
that are sparsely populated, have mostly Black residents, and were
considered low income.\25\ Family physicians were found to deliver
babies more commonly in rural areas than in urban as many lack a
dedicated obstetrician-
gynecologist (OB/GYN).
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\24\ Roeder, Amy. ``Maternity ward closures exacerbate health
inequity | News.'' Harvard T.H. Chan School of Public Health, 13
December 2023, https://www.hsph.harvard.edu/news/features/maternity-
obstetric-closure-health-disparities/. Accessed 30 April 2024.
\25\ Government Accountability Office. ``Maternal Health:
Availability of Hospital-Based Obstetric Care in Rural Areas.''
Government Accountability Office, 19 October 2022, https://www.
gao.gov/assets/gao-23-105515.pdf. Accessed 14 May 2024.
The AAFP believes family physicians can play a significant part in
addressing the disparities in maternal morbidity and mortality because
they are trained to provide comprehensive care across the life course,
including prenatal, perinatal, and postpartum care for people in the
communities where they live. More than 1 in 10 family physicians (13
percent) reported they delivered babies in 2022. A 2019 study found
that in rural counties overall, there were about equal numbers of
family physicians and OB/GYNs, but in urban counties there was about
one family physician for every six OB/GYNs.\26\
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\26\ Government Accountability Office.
The AAFP has two courses to provide education and build skills focused
on recognizing obstetrical emergencies. Advanced Life Support in
Obstetrics (ALSO') is a program that equips the entire
maternity care team with skills to effectively manage obstetrical
emergencies. Basic Life Support in Obstetrics (BLSO') is
designed to improve the management of normal deliveries, as well as
obstetrical emergencies, by standardizing the skills of first
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responders, emergency personnel, and maternity care providers.
To further address this issue, the AAFP recommends that Congress pass
the Rural Obstetrics Readiness Act (S. 4079), which would establish
training programs to help non-specialists respond to obstetric
emergencies. The bill would also provide grants for rural facilities to
provide better equipment to train for and handle these emergencies and
develop a pilot program for teleconsultation services so a maternal
care expert can provide consulting services in an emergency.
However, training clinicians on how to deliver care during an obstetric
emergency does not solve the problem. The fact remains that Americans
living in rural areas are much less likely to have access to an
obstetric unit than those living in urban and suburban areas. According
to the Government Accountability Office (GAO) there are two main
factors that affect the availability of hospital-based obstetric care
in rural areas: Medicaid reimbursement rates and recruiting and
retaining providers.
Fifty percent of births in rural areas are covered by Medicaid compared
to 43 percent in the U.S. as a whole making Medicaid reimbursement
rates vital to the operation of rural obstetric units. However, the
reimbursement rate set by states does not cover the full cost of
providing obstetric services.\27\ Medicaid only pays about half of what
private insurers pay for childbirth-related services. Since hospital-
based obstetric services can be costly to operate, it is essential to
provide fair reimbursement for all births. Hospitals often rely on
private insurance payments, non-obstetrical surgical care, and other
supporting services to subsidize their losses from obstetric services,
which leaves rural hospitals in a vulnerable financial position.
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\27\ Government Accountability Office.
Rural hospitals also face challenges in recruiting and retaining
providers. While there is a shortage of physicians and other
clinicians, it is even more pronounced in rural areas. The Health
Resources and Services Administration (HRSA) estimates that the
anticipated supply of OB/GYNs is expected to meet only 50 percent of
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the demand in rural areas.
Gaps in insurance coverage and availability of affordable care also
increase the risk of morbidity and mortality, particularly during the
postpartum period. We appreciate that Congress permanently extended the
voluntary option for states to provide postpartum Medicaid coverage for
up to a year in the Consolidated Appropriations Act of 2022. However, a
permanent solution across all states is needed to ensure access to
continuous care for pregnant people throughout the full, 1-year
postpartum period.
Current law only requires states to provide Medicaid coverage based on
pregnancy status up to 60 days postpartum. As the largest single payer
of maternity care in the U.S., Medicaid has a critical role to play in
ensuring healthy moms and babies.\28\ According to the Centers for
Disease Control and Prevention, more than half (53 percent) of
pregnancy-related deaths occur between 1 week and 1 year postpartum,
during which time many postpartum individuals lose Medicaid
coverage.\29\ The AAFP therefore continues to advocate for requiring
one year of postpartum Medicaid coverage as an important way to address
the disparities in maternal health and improve outcomes. Specifically,
Congress should pass the Healthy Maternal and Obstetric Medicine
(Healthy MOM) Act (S. 3509/H.R. 6716) to create a special enrollment
period for marketplace plans for pregnant people and require states to
offer Medicaid coverage to pregnant people up to 12-months postpartum.
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\28\ Valenzuela, Claudia P., and Michelle JK Osterman.
``Characteristics of Mothers by Source of Payment for the Delivery:
United States, 2021.'' Centers for Disease Control and Prevention, 25
May 2023, https://www.cdc.gov/nchs/products/databriefs/db468.htm.
Accessed 30 April 2024.
\29\ Centers for Disease Control and Prevention. ``Four in 5
pregnancy-related deaths in the U.S. are preventable | CDC Online
Newsroom | CDC.'' Centers for Disease Control and Prevention, 19
September 2022, https://www.cdc.gov/media/releases/2022/p0919-
pregnancy-related-deaths.html. Accessed 30 April 2024.
Further, the AAFP recognizes that the root causes of racial and ethnic
disparities in maternal morbidity and mortality include institutional
racism in the health care and social service delivery system and social
and economic inequities. Implicit bias is pervasive among all health
care professionals and has deleterious effects on patient health.\30\
It reduces trust, self-efficacy, understanding, and satisfaction
between a patient and their physician, affecting a patient's ability to
manage their health and adhere to treatment. For physicians, implicit
bias limits their level of cultural proficiency, patient-centeredness,
and job satisfaction.
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\30\ Peek, Monica E et al. ``Development of a Conceptual Framework
for Understanding Shared Decision making Among African-American LGBT
Patients and their Clinicians.'' Journal of General Internal Medicine
vol. 31,6 (2016): 677-87. doi:10.1007/s11606-016-3616-3.
Formal medical education and training curricula often lack content that
provides a framework for identifying and mitigating implicit biases in
clinical practice. Faculty who seek to incorporate this topic in
training are often faced with barriers, such as the limited number of
subject matter experts who can provide instruction, a lack of
opportunities for participants to observe and demonstrate mitigation
strategies in practice, and a lack of opportunities to engage with
patients who can share experiences of encountering implicit bias in the
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delivery of prenatal care.
The implicit biases of health care professionals toward people of
color, particularly Black women, have been shown to be a contributing
factor to racial and ethnic disparities in adverse maternal health
outcomes. For example, studies have demonstrated that implicit bias of
health care professionals affects rates of racial and ethnic
disparities in contraception use,\31\ access to and quality of prenatal
care,\32\, \33\ and clinical decision-making \34\ in the
intrapartum and postpartum periods.
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\31\ Jackson, Andrea V et al. ``Racial and ethnic differences in
contraception use and obstetric outcomes: A review.'' Seminars in
perinatology vol. 41,5 (2017): 273-277. doi:10.1053/j.semperi.
2017.04.003.
\32\ Kogan, M D et al. ``Racial disparities in reported prenatal
care advice from health care providers.'' American Journal of Public
Health vol. 84,1 (1994): 82-8. doi:10.2105/ajph.84.1.82.
\33\ Slaughter-Acey, Jaime C et al. ``Personal Versus Group
Experiences of Racism and Risk of Delivering a Small-for-Gestational
Age Infant in African American Women: A Life Course Perspective.''
Journal of Urban Health: bulletin of the New York Academy of Medicine
vol. 96,2 (2019): 181-192. doi:10.1007/s11524-018-0291-1.
\34\ Bryant, Allison S et al. ``Racial/ethnic disparities in
obstetric outcomes and care: prevalence and determinants.'' American
Journal of Obstetrics and Gynecology vol. 202,4 (2010): 335-43.
doi:10.1016/j.ajog.2009.10.864.
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Strengthen and Target Graduate Medical Education Programs
As acknowledged previously, the U.S. faces a critical family physician
workforce shortage, compounded by misalignment of resources in medical
education, which has led to disparate care access for patients
nationwide. Though the current system excels at educating skilled
physicians and physician researchers, the primary care physician
shortage prevents the U.S. from taking advantage of the better outcomes
and lower per capita costs associated with robust primary care systems
in other countries.
Most physicians are trained at large academic medical centers in urban
areas, and evidence indicates physicians typically practice within 100
miles of their residency program.\35\ As a result, the current
distribution of trainees leads to physician shortages that are
particularly dire in medically underserved and rural areas. While 20
percent of the U.S. population lives in rural communities, only 12
percent of primary care physicians and 8 percent of subspecialists
practice in these areas.
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\35\ Fagan BE, Finnegan SC, Bazemore AW, Gibbons CB, Petterson SM.
Migration After Family Medicine Residency: 56% of Graduates Practice
Within 100 Miles of Training--Graham Center Policy One-Pagers--American
Family Physician.
The Academy encourages Congress to consider ways to reimagine our
country's graduate medical education (GME) system so that it better
supports and invests in primary care, including an expansion of
training in community-based settings. This will bolster our primary
care workforce for the future and allow us to realize the true value of
primary care for generations to come, including significant cost
savings and improved patient outcomes as we shift toward a system that
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prioritizes health care, rather than sick care.
The AAFP supports consistent funding for GME for family medicine to
ensure that new residency slots are allocated to address rural and
urban imbalances, reduce physician shortages, and focus on medically
underserved areas, including funding for programs such as the federal
Teaching Health Center GME (THCGME) program.
Teaching Health Centers (THCs) play a vital role in training the next
generation of primary care physicians and addressing the physician
shortage. To date, the THCGME program has trained more than 2,027
primary care physicians and dentists, 61 percent of whom are family
physicians. Data shows that, when compared to traditional postgraduate
trainees, residents who train at THCs are more likely to practice
primary care (82 percent vs. 23 percent) and remain in underserved (55
percent vs. 26 percent) or rural (20 percent vs. 5 percent)
communities. This demonstrates that the program is successful in
tackling the issue of physician maldistribution and helps address the
need to attract and retain physicians in rural areas and medically
underserved communities.
However, the THCGME program's authorization expires at the end of this
year, which further jeopardizes the stability of this program for its
current and future residents as well as the patients they serve.
Historically, the program has received piece-meal, short-term
reauthorizations from Congress. This fails to consider the fact that
family medicine residencies are 3-year programs, meaning many medical
students are dissuaded from applying to THC residencies because they
have no certainty that the program will even be around long enough for
them to complete their training. We have unfortunately seen this
instability result in some THCGME programs accepting fewer or no new
residents for next year or closing their program entirely.
For these reasons, the AAFP strongly cautions against a short-term
extension. Instead, the AAFP recommends that Congress pass the Doctors
of Community (DOC) Act (H.R. 2569) to permanently authorize the THCGME
program. Absent a permanent solution, we urge Congress to, at a
minimum, provide a multi-year reauthorization that provides sufficient
funding levels to support the true per-resident costs to each program.
We also strongly urge Congress to pass the Rural Physician Workforce
Production Act (S. 230/H.R. 834), which would provide invaluable new
federal support for rural residency training to help alleviate
physician shortages in rural communities. Specifically, the bill would
remove caps for rural training and provide new robust financial
incentives for rural hospitals, including critical access and sole
community hospitals, to provide the training opportunities that the
communities they serve need.
While the new Medicare GME residency slots approved in the previous
Congress were very much appreciated, additional action is needed to
address disparate access to care in rural and other medically
underserved areas. Merely expanding the existing Medicare GME system
will not fix the shortage and maldistribution of physicians. Any
expansion of Medicare GME slots should be targeted specifically toward
hospitals and programs in areas and specialties of need, including by
considering which ones have a proven track record of training
physicians who ultimately practice in physician shortage areas.
One barrier to creating a more equitable and effective Medicare GME
program is the lack of transparency in how funds are used. Medicare is
the largest single payer of GME, spending about $16 billion annually,
but it does not assess how those funds are ultimately used or whether
they actually address physician shortages.\36\ CMS has indicated their
authority is limited to making payment to hospitals for the costs of
running approved GME residency programs. Congress should pass
legislation granting the Secretary of HHS and the CMS Administrator the
authority to collect, analyze data on how Medicare GME positions are
aligned with national workforce needs, and publish an annual report.
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\36\ Congressional Research Service. Federal Support for Graduate
Medical Education: An Overview. https://fas.org/sgp/crs/misc/
R44376.pdf. Published December 27, 2018. Accessed February 9, 2023.
Thank you to the Committee for its continued bipartisan leadership to
improve access to rural health care. The AAFP looks forward to
continuing to work with you to advance policies that will best support
family physicians and the patients they serve in these communities.
Should you have any questions, please contact Natalie Williams, Senior
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Manager of Legislative Affairs at [email protected].
Sincerely,
Tochi Iroku-Malize, M.D., MPH, MBA, FAAFP
Board Chair
Founded in 1947, the AAFP represents 130,000 physicians and medical
students nationwide. It is the largest medical society devoted solely
to primary care. Family physicians conduct approximately one in five
office visits--that's 192 million visits annually or 48 percent more
than the next most visited medical specialty. Today, family physicians
provide more care for America's underserved and rural populations than
any other medical specialty. Family medicine's cornerstone is an
ongoing, personal patient-physician relationship focused on integrated
care. To learn more about the specialty of family medicine and the
AAFP's positions on issues and clinical care, visit www.aafp.org. For
information about health care, health conditions and wellness, please
visit the AAFP's consumer website, https://family
doctor.org/.
Links
https://www.aafp.org/about/policies/all/rural-practice-keeping-
physicians.html
https://www.aafp.org/about/policies/all/maternal-child.html
https://www.aafp.org/cme/programs/also.html
https://www.aafp.org/cme/programs/blso.html
https://www.aafp.org/about/policies/all/birth-equity-pos-paper.html
https://www.aafp.org/about/policies/all/graduate-medical-education-
financing.
html
https://www.aafp.org/dam/AAFP/documents/advocacy/workforce/gme/LT-
Congress-RuralWorkforceProductionAct-021423.pdf
______
American Academy of Physician Associates
2318 Mill Road, Suite 1300
Alexandria, VA 22314
P 703-836-2272
F 703-684-1924
https://www.aapa.org/
Dear Chairman Wyden, Ranking Member Crapo and members of the committee:
On behalf of the more than 168,000 physician associates/physician
assistants (PAs) throughout the United States, the American Academy of
Physician Associates (AAPA) thanks the committee for your ongoing
commitment to ensuring all Americans have access to high-quality
healthcare. AAPA appreciates the opportunity to submit comments for the
record with respect to the committee's May 16, 2024, Hearing ``Rural
Health Care: Supporting Lives and Improving Communities.''
AAPA recognizes the complex and multifaceted issues and challenges
facing the healthcare workforce in the United States, especially on the
heels of a global pandemic and record levels of burnout. As our
nation's population continues to age and additional factors, such as
rising chronic disease, increase demand for healthcare services, we are
confident that PAs are an integral part of the solution. The PA
profession was established in the 1960s at a time when the nation was
facing a primary care shortage and was founded to improve access,
especially in rural and underserved communities.\1\ Today, PAs remain
ready to respond to the national demand for greater access to high-
quality healthcare services. PAs already possess the medical education,
training, and experience to do so.
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\1\ Cawley JF, Cawthon E, Hooker RS. Origins of the physician
assistant movement in the United States. JAAPA. 2012 Dec;25(12):36-40,
42.
As Congress considers policies to ensure timely access to high-quality
care for all patients, AAPA encourages the committee to embrace
opportunities to reduce provider barriers and burdens wherever they
interfere with optimizing patient care and access. AAPA also encourages
the Congress to reauthorize current programs to address workforce
challenges and enact legislation to ensure all providers can practice
to the top of their license and education. Although PAs are already
providing high-quality care across the nation and in all medical
specialties, outdated barriers to practice remain. AAPA stands ready to
work with the committee as you consider new ideas to ensure quality
care is available to all Americans, particularly those in rural and
underserved communities.
Background: What is a PA?
PAs are medical professionals who diagnose illness, develop, and manage
treatment plans, prescribe medications, and are often a patient's
primary healthcare provider. PAs are highly trained professionals with
thousands of hours of medical education and training who practice in
all medical and surgical specialties in all 50 states, the District of
Columbia, U.S. territories, and in the uniformed services.
Additionally, PAs are one of three healthcare professions, including
physicians and advanced practice registered nurses (APRN), who are
recognized in Medicare to provide both primary and mental health
medical care in the United States. The typical PA education program
provides students with an intensive, master's degree level, medical
education over approximately three academic years, or 27 continuous
months.\2\ However, PA education does not end with graduation. To
practice, PAs must pass the PA National Certifying Examination and
obtain state licensure. To maintain certification, PAs must also
complete 100 hours of continuing medical education (CME) every two
years and pass a comprehensive examination every ten years.\3\ Many PAs
seek additional educational opportunities following graduation and
throughout the duration of their careers.
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\2\ PAEA. Program report 35, Table 6, page 7.
\3\ NCCPA. Certified PAs: Improving health, saving lives, making a
difference. https://prodcmsstoragesa.blob.core.windows.net/uploads/
files/PatientBrochure.pdf.
For more than 50 years, PAs have provided high-quality, cost-effective
healthcare services to patients across the nation. However, several
barriers remain at the state and federal levels that prevent PAs from
practicing to the full extent of their education, training, and
license. These barriers diminish the value PAs can bring to rural
communities suffering from ongoing shortages of qualified healthcare
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providers.
According to the Health Resources and Services Administration (HRSA),
more than 15% of Americans live in rural areas, but only 10% of
physicians practice in those communities.\4\ About 16% of all
clinically practicing PAs are located in a rural county, with more than
1 in 3 practicing much needed primary care in rural locations. Removing
barriers to ensure PAs can practice to the top of their license should
be viewed as an important solution to the shortage of providers along
with adequate access to primary care in rural and underserved areas.
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\4\ HRSA. Designated HPSAs as of March 31, 2024. file:///C:/Users/
DP953PR/Downloads/BCD--HPSA--SCR50--Qtr--Smry.pdf.
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Diabetic Shoes
PAs diagnose and treat illnesses, manage complex conditions, prescribe
medications in all 50 states, and assist in surgery--but the current
statute governing Medicare does not authorize PAs to complete the
simple task of ordering diabetic shoes. With the aging U.S. population
and increasing prevalence of diabetes, it is absurd that a PA can
manage a patient's diabetes and other complex chronic conditions but is
not authorized to order diabetic shoes. The Promoting Access to
Diabetic Shoes Act (S. 131/H.R. 618) will modernize current Medicare
policy and authorize PAs to certify a patient's need for diabetic
shoes.
A study published in the American Journal of Medicine in 2018 found
that PAs perform as well as physicians in the management of diabetes at
diagnosis and during 4 years of follow-up care. PAs are federally
recognized primary care providers and frequently manage care for
diabetics who may have multiple comorbidities. Outside of the Medicare
program, PAs can certify the need for diabetic shoes for their
patients. This is an example of the Medicare statute not making common
sense or keeping up with how medicine is practiced today.
Diabetic foot complications are directly related to poor clinical
outcomes and substantial cost, especially among rural Medicare
patients. Compared to urban populations, rural populations have a 16
percent higher prevalence of type 2 diabetes, a 20 percent higher type
2 diabetes-related hospital mortality, and smaller improvements in
overall mortality rates in the past 2 decades.\5\ It is further
estimated that rural patients face a nearly 35 percent increase in
major amputation following diabetic foot ulcers as compared to patients
living in urban areas.\6\
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\5\ Dugani, Sagar et al. Diabetes Metab Res Rev. Burden and
Management of Type 2 Diabetes Mellitus in Rural United States.
\6\ Krepnek GH, Mills JL, Armstrong DG. A diabetic emergency one
million feet long: Disparities and burdens of illness among diabetic
foot ulcer cases within emergency departments in the United States,
2006-2010.
Often referred to among providers as the ``diabetic amputation loop,''
19 percent of diabetic patients will then face a second amputation
within 1 year and more than 37 percent within the first 5 years.\7\ The
cost of a lower extremity amputation (LEA) among Medicare beneficiaries
is substantial and growing. It has been estimated that the mean annual
reimbursement of all services for diabetic Medicare patients with an
LEA was more than $49,000 in 2006, more than $51,000 in 2007, and more
than $54,000 in 2008.\8\
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\7\ Liu R, Petersen BJ, Rothenberg GM, et al. Lower extremity
reamputation in people with diabetes: A systematic review and meta-
analysis. BMJ Open Diab Res Care 2021;9:e002325. doi:10.1136/ bmjdrc-
2021-002325.
\8\ Margolis DJ, Malay DS, Hoffstad OJ, et al. Economic burden of
diabetic foot ulcers and amputations: Data Points #3. 2011 Mar 8. In:
Data Points Publication Series [Internet]. Rockville (MD): Agency for
Healthcare Research and Quality (US); 2011-. Available from: https://
www.ncbi.nlm.nih.gov/books/NBK65152/.
Modernizing Medicare to authorize PAs to certify a patient's need for
diabetic shoes, consistent with state law, will improve the quality and
continuity of care available to diabetic patients, especially for those
living in rural and medically underserved areas experiencing critical
access issues and physician shortages.
Mental and Behavioral Healthcare Access
Our nation is currently facing a significant shortage of mental
healthcare providers, and unfortunately this shortage is only projected
to grow in the coming years. As front-line providers, PAs are
recognized across the nation as high-need providers in mental health
who play a critical role in expanding psychiatric care.\9\ While some
PAs practice in mental and behavioral health specialties including
psychiatry, currently more than 30,000 PAs practice in primary care and
routinely provide mental healthcare to their patients.\10\ PAs in
emergency and hospital medicine also treat patients with psychiatric
symptoms and are often a first line provider for patients to access
mental or behavioral health services. PAs also serve an essential role
providing high-quality mental health services to veterans across the
Department of Veterans Affairs (VA) system. It is imperative that PAs
are authorized to practice to the full extent of their education,
training, and experience to confront the growing need for behavioral
and mental healthcare services.
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\9\ Medical Director Institute. The psychiatric shortage: Causes
and solutions. National Council for Behavioral Health. March 28, 2017.
Washington, DC. https://www.thenationalcouncil.org/wp-content/uploads/
2017/03/Psychiatric-Shortage_NationalCouncil-.pdf.
\10\ AAPA. 2020 PA Data Book.
As highly educated and qualified medical professionals, PAs practice in
behavioral health facilities, hospitals, private practice, rural health
clinics, community health centers, and prisons across the United
States. With clinical expertise, medical training, and the initiative
to help, PAs are on the ground in local communities. In 2018, the PA
Foundation launched an inaugural Mental Health Outreach Fellowship.\11\
This profession-driven initiative was the first phase of a wider mental
health outreach effort that sought to connect PAs with community mental
health needs.\12\ In 2019, the first PA fellows reported training more
than 1,500 people across the United States to recognize and respond to
mental health needs in their communities.
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\11\ https://pa-foundation.org/mental-health-outreach-reflecting-
and-forging-ahead/.
\12\ https://pa-foundation.org/our-programs/mental-health-outreach-
fellowship/.
Recognized in federal law as providers in opioid treatment programs,
PAs are also instrumental in providing care for patients with substance
use disorder (SUD) and surrounding mental, physical, and behavioral
health concerns. Effective treatments for substance use disorders are
available, but few patients receive the treatment they need. In 2019,
only 12.1% of individuals with a SUD received treatment.\13\
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\13\ https://health.gov/healthypeople/objectives-and-data/browse-
objectives/drug-and-alcohol-use/increase-proportion-people-substance-
use-disorder-who-got-treatment-past-year-su-01/data.
While rural and urban areas alike are dealing with an overdose crisis,
56 percent of rural counties lack access to a provider who can
prescribe treatment.\14\ PAs are authorized to prescribe controlled
medications in all 50 states. Once granted, no state has ever rescinded
PA authority to prescribe controlled medications. There has been no
record of increased liability or malpractice claims due to PA
prescribing of scheduled drugs, and professional liability insurers
have not increased premiums when PAs have been granted authority to
prescribe controlled medications.
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\14\ AIR, Exploring Urban-Rural Disparities in Accessing Treatment
for Opioid Use Disorder, November 19, 2021. https://www.air.org/
resource/equity-focus/exploring-urban-rural-disparities-accessing-
treatment-opioid-use-
disorder#::text=Rural%20and%20urban%20communities%20
alike,treatment%20for%20opioid%20use%20disorder.
Healthcare in the United States continues to evolve from a traditional,
physician-centric model to a more streamlined, efficient, and patient-
centric model and PAs are evolving with it. As our nation faces a
severe shortage of behavioral health providers, including physicians,
it is imperative that PAs and other qualified mental health providers
are appropriately utilized to provide this necessary care. The COVID-19
pandemic and public health emergency (PHE) highlight just how critical
a robust and secure healthcare workforce is to our nation's security
and overall well-being. Access to high-quality, evidence-based
healthcare is critical for positive patient outcomes and healthy
communities. PAs and other providers throughout the United States have
faced increased stress, high rates of burnout and challenges to their
own mental health. PAs must also confront an increasing demand to
provide critical healthcare services while physician shortages,
especially in rural and low-income areas, continue to grow.\15\
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\15\ https://www.aamc.org/media/45976/download?attachment.
Medicare Shared Savings Accountable Care Organization (ACO)
PAs are recognized in the Medicare Shared Savings Program (MSSP) as
``ACO professionals,'' yet their patients cannot be assigned as
beneficiaries in that program. Under current law, Medicare fee-for-
service beneficiaries are assigned to an ACO based on their utilization
of primary care services furnished by a physician. However, individuals
in rural and underserved communities often rely on PAs and other
advanced practitioners. As a result, the physician requirement prevents
Medicare fee-for-service beneficiaries in these communities from
accessing the coordinated care provided by ACOs. It is essential that
primary care services furnished by PAs and other advanced care
providers count for purposes of ACO assignment. This encourages ACO
formation in rural and underserved areas and allows healthcare
providers to attain enough ACO beneficiaries to participate in the
Medicare Shared Savings Program. Through these changes, ACO assignments
will be more effective for beneficiaries and providers in rural
communities that suffer from acute physician shortages and encourage
the adoption of value-based care principles such as care coordination
and population health.
The ACO Assignment Improvement Act (S. 3939/H.R. 7665) will improve the
way beneficiaries are assigned under the MSSP by also basing such
assignment on primary care services furnished by nurse practitioners,
physician assistants, and clinical nurse specialists.
Cardiac and Pulmonary Rehabilitation (CR/PR)
Current law arbitrarily restricts the ordering and supervision of
cardiac and pulmonary rehabilitation in Medicare. In 2018, Congress
rightfully authorized PAs and other advanced practice providers to
supervise cardiac and pulmonary (CR/PR) services but with a delayed
implementation until 2024. However, PAs are still not authorized to
order this critical service for their patients.
CR/PR services are an essential and proven tool in the management of
patients with chronic respiratory conditions, those who have survived
myocardial infarction (heart attack) as well as patients fighting
chronic obstructive pulmonary disease (COPD.) CR/PR services have also
been used to treat patients recovering from an active SARS-COV-2
infection. Despite the clinical implications and critical importance of
this treatment, CR/PR services remain severely underutilized,
especially among high-risk populations in rural areas.\16\
---------------------------------------------------------------------------
\16\ Fleg JL, Keteyian SJ, et al. Increasing Use of Cardiac and
Pulmonary Rehabilitation in Traditional and Community Settings:
Opportunities to Reduce Health Care Disparities. J Cardiopulm Rehabil
Prev. 2020 Nov;40(6):350-355. doi: 10.1097/HCR.0000000000000527. PMID:
33074849; PMCID: PMC7644593.
CR/PR services are offered through medically directed and supervised
programs designed to improve a patient's physical, psychological, and
social functioning. Both programs utilize supervised exercise, risk
factor modification, education, counseling, behavioral modification,
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psychosocial assessment, and outcomes assessment.
PAs are routinely on the front line in critical care environments, such
as in hospitals, clinics, emergency rooms, and intensive care units.
They are highly trained providers, qualified to order and supervise
critical medical services. However, under current law only physicians
may order and supervise CR/PR programs in Medicare. CR/PR services are
proven to improve health outcomes for patients who have survived a
heart attack and/or have chronic obstructive pulmonary disease (COPD)
and can treat patients recovering from other chronic diseases,
including COVID-19. However, this life-saving treatment is
underutilized, especially in rural and medically underserved areas,
because qualified providers such as PAs are unnecessarily and
arbitrarily prevented from ordering and supervising CR/PR. Patients
deserve the highest-care available; outdated restrictions like this
only compound the challenge in areas where access issues and care
disparities are particularly acute. The Increasing Access to Quality
Cardiac Rehabilitation Care Act (S. 3481/H.R. 2583) would authorize PAs
to order this critical service for Medicare patients, especially those
in rural areas.
Hospice and Palliative Care
In 2018, the Medicare Patient Access to Hospice Act was included in the
Bipartisan Budget Act of 2018 and broadened the Medicare definition of
hospice ``attending physician'' to include PAs. This inclusion took
effect in January of 2019 and was a necessary step in ensuring adequate
access to hospice care for Medicare patients, especially those in rural
and underserved areas.
PAs regularly function as a patient's primary healthcare provider.
Frequently, it is the primary provider, acting in the role of a
Medicare hospice attending physician, who helps with a patient's
transition to hospice and subsequently assists in facilitating care
received. However, PAs may not certify or re-certify terminal illness.
PAs are highly qualified health professionals and should be authorized
to perform these functions, consistent with state law, under Medicare.
Further, PAs need to be authorized to perform the face-to-face
encounter that is required prior to recertification after a patient has
been under the hospice benefit for 180 days. NPs, however, are
authorized to perform this face-to-face visit that is then used by a
physician to determine a patient's eligibility for recertification.
These arbitrary restrictions on PAs remain a significant barrier to
care for patients needing hospice services and are amplified in their
detrimental effects by ongoing provider shortages. Our rural
communities are facing a significant hospice workforce shortage that
Congress could help alleviate. Authorizing PAs to certify and recertify
terminal illness, in addition to perform face-to-face visits required
for recertifications, something well within their scope and education,
would significantly increase the number of highly qualified providers
in the hospice workforce.
AAPA requests that Congress 1) modify 42 U.S.C. 1395f(a)(7)(A) to
authorize PAs to certify and recertify terminal illness, and 2) modify
42 U.S.C. 1395f(a)(7)(D)(il) to authorize PAs to perform the face-to-
face encounter prior to recertification after a patient has been under
the hospice benefit for 180 days.
Federal Workers Compensation
Currently, all U.S. federal and postal employees receive workers
compensation coverage for employment-related injuries and disease
through the Federal Employees Compensation Act (FECA). However, FECA
does not cover medical care provided by PAs (or nurse practitioners
[NPs]) within the current definition of ``medical, surgical, and
hospital services. . . ,'' meaning once a federal or postal employee is
injured on the job, they can no longer receive healthcare from a PA,
even if that PA is their primary care provider (PCP) through their
federal health insurance program. This undue and unnecessary
restriction negatively impacts our federal workforce, especially those
in rural areas where access to any provider, not just physicians, can
be challenging.
PAs provide high-quality healthcare and are recognized providers in
Medicare, Medicaid, and nearly every state and federal healthcare
program, including state workers' compensation programs. PAs are
included in the definition of an ``acceptable medical source'' by the
Social Security Administration and thousands of PAs are federal
employees themselves and practice within the Department of Veterans
Affairs, the Department of Defense, the Public Health Service, and
Indian Health Services. FECA is the outlying federal program that does
not recognize the critical role PAs play in our healthcare system. The
Improving Access to Workers' Compensation for Injured Federal Workers
Act (S. 260/H.R. 704) would authorize PAs to treat their federally
employed patients in accordance with state law.
Conclusion
In 2021, an AAPA Practice Survey \17\ found that approximately half of
the PAs who responded were already working in or interested in moving
to practice in, a rural location, health professional shortage area, or
medically underserved area. PAs are practicing in rural areas across
the nation and while interest remains high, barriers and recruitment
challenges remain. While PAs increase access to healthcare in rural
areas, they also increase economic benefits in the same
communities.\18\ AAPA urges the committee to consider the vital role
that PAs and other providers play in communities across the nation,
specifically in rural and underserved areas, and ensure that they can
provide the care that is so critically needed.
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\17\ https://www.aapa.org/download/103451/.
\18\ Eilrich FC. The economic effect of a physician assistant or
nurse practitioner in rural America. JAAPA. 2016;29(10):44-48.
doi:10.1097/01.JAA.0000496956.02958.dd.
AAPA thanks the committee for the opportunity to submit these
recommendations and for your ongoing dedication to our nation's
healthcare systems. We are committed to working with Congress to
advance our shared mission of improving access to healthcare in the
United States. If we can be of assistance on this or any issue, please
do not hesitate to contact Tate Heuer, AAPA Vice President, Federal
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Advocacy, at [email protected].
______
American Association of Nurse Anesthesiology
25 Massachusetts Ave., NW, Suite 320
Washington, DC 20001
Statement of Dru Riddle, Ph.D., DNP, CRNA, FAAN, President
Background on AANA and CRNAs
Chairman Wyden, Ranking Member Crapo, and Members of the Committee,
thank you for the opportunity to offer this statement for the record.
The American Association of Nurse Anesthesiology (AANA) is the
professional association for Certified Registered Nurse Anesthetists
(CRNAs) and student registered nurse anesthetists, with membership that
includes more than 61,000 CRNAs and student nurse anesthetists
representing over 85 percent of the nurse anesthetists in the United
States. CRNAs are advanced practice registered nurses (APRNs) who
provide anesthesia, as well as acute, chronic, and interventional pain
management services. In some states, CRNAs are the sole anesthesia
providers in nearly 100 percent of rural hospitals, affording these
medical facilities obstetrical, surgical, trauma stabilization, and
pain management capabilities.
AANA applauds the Committee's decision to hold this hearing, as it is
of the utmost importance that our nation's healthcare systems that we
ensure rural communities have access to high quality, timely
healthcare. This hearing is an important opportunity to address the
unique healthcare challenges that rural communities face. CRNAs and
other advance practice registered nurses (APRNs) have consistently
answered the call to help ensure these communities have access to care.
To better help these communities, Congress should remove costly,
unnecessary barriers to care and mobilize resources already available
to them. We strongly urge Congress to pass the Improving Care and
Access to Nurses (ICAN) Act (S. 2418/H.R. 2713) that would make much
needed updates to Medicare and Medicaid that would help rural and
nonrural communities alike.
CRNAs are highly trained and skilled anesthesia providers who have full
practice authority in the Army, the Navy, and the Air Force, as well as
the Indian Health Service. CRNAs are the primary provider of anesthesia
on the battlefield, including in forward surgical hospitals. CRNAs
possess all the necessary skills and training to be autonomous
providers of anesthesia, particularly in rural and underserved
communities where they predominate. This is why states have continued
to remove barriers to CRNA practice to allow CRNAs to practice to the
top of their education and skills. This increases access, lowers costs,
increases efficiency in the healthcare system, and improves competition
in a healthcare system that is plagued by consolidation and monopoly.
Rural Healthcare: How CRNAs Can Fill the Gaps
Rural communities tend to have higher rates of poverty, more elderly
residents, poorer overall levels of health, and have fewer physician
practices, hospitals, and other health care facilities. Ongoing
provider shortages are felt even more acutely in rural areas. These
disparities are critical when it comes to the anesthesia workforce. In
rural areas, unnecessary supervision requirements can have a disastrous
impact on a patient's ability to access healthcare in a timely manner
and delayed delivery of healthcare can lead to dangerous, even deadly,
complications. According to the Journal of Rural Health, 81.2% of rural
counties lack a physician anesthesiologist.\1\ Data from the VA shows
that full practice authority for other APRNs has increased access to
care and decreased wait times, and Congress should work to remove
barriers that inhibit CRNAs and other APRNs from providing this
care.\2\
---------------------------------------------------------------------------
\1\ ``The Surgical and Anesthesia Workforce and Provision of
Surgical Services in Rural Communities: A Mixed-Methods Examination''
(Cohen, et al., 2020). https://doi.org/10.1111/jrh.12417.
\2\ Rugs, D., Toyinbo, P., Barrett, B., Melillo, C., Chavez, M.,
Cowan, L., Jensen, P. K., Engstrom, C., Battaglia, C., Thorne-Odem, S.,
Sullivan, S. C., & Powell-Cope, G. (2021). A preliminary evaluation of
full practice authority of advance practice registered nurses in the
Veterans Health Administration. Nursing outlook, 69(2), 147-158.
https://doi.org/10.1016/j.outlook.2020.11.005.
While physician anesthesiologists are a rarity in rural communities,
the same cannot be said of CRNAs who are much more prevalent in rural
communities. Unlike our physician peers, who are more likely to care
for higher-income populations, CRNAs are disproportionately the
anesthesia provider for rural and low-income communities.\3\ Given the
reality that healthcare outcomes are identical between physician
anesthesiologists and CRNAs, as well as the potential cost-savings, we
urge Congress to remove barriers to care and allow a well-trained
workforce to fill gaps in communities across the country. Since states
have had the option to opt-out of Medicare's unnecessary supervision
requirements for CRNAs, 24 states have opted out, and no opt-out has
ever been reversed.
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\3\ ``Geographical Imbalance of Anesthesia Providers and its Impact
on the Uninsured and Vulnerable Populations'' (Liao, et al. 2015).
https://pubmed.ncbi.nlm.nih.gov/26625579/.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Map of states that have opted out of Medicare's supervision
requirement for CRNAs
CRNA Supervision: At What Cost?
Currently, only seven states have rules in their Nurse Practice Acts or
the State Boards of Nursing that require physician supervision of CRNA
services. Twenty-four states have already opted out of Medicare's
supervision requirement for CRNAs as well. Only one state requires the
involvement of a physician anesthesiologist when a CRNA is providing
care, and only at ambulatory surgical centers. Every branch of the
military allows for CRNAs to practice autonomously. Supervision has no
proven benefits to patients but has proven costs and detriments.
Comparing various methods of anesthesia delivery, an autonomous CRNA
collaborating with a surgeon is the most cost-effective model for
anesthesia delivery. Current trends in the QZ modifier, which is
utilized when a CRNA is billing for anesthesia without supervision,
have shown a steady increase in the utilization of this billing
modifier, implying an increase in CRNA autonomous practice. The
anesthesia care team model, of 1:3 supervision is one of the most
expensive anesthesia delivery models possible. Allowing for autonomous
practice by CRNAs allows facilities the flexibility to choose a model
that meets their needs and helps to keep costs down.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
CRNA Safety and Outcomes
The evidence is overwhelming that CRNA independent practice is just as
safe as the anesthesia care provided under supervision or by our
physician anesthesiologists colleagues. In a study that the VA
commissioned from Temple University, it was found that ``studies have
found that CRNAs who had an expanded scope of practice did not have
worse patient outcomes, complications, or mortality when compared to
anesthesiologists.''\4\ A peer reviewed study published in the Journal
of Medicare Care in 2016 looked at anesthesia related complications for
CRNA only, anesthesiologist only, and a team-based approach and found
there were no differences in complication rates based on delivery
model.\5\ This corroborates an earlier peer reviewed study published in
Health Affairs in 2010 that looked at the differences in outcomes in
states that had opted out of Medicare's supervision requirement for
CRNAs were no different than outcomes in states that maintained
supervision.\6\ A comprehensive review completed by the Cochrane
Library in 2014 further reinforced these finding, when it reviewed the
literature on anesthesia staffing and found that there could be no
definitive statement can be made about the superiority of anesthesia
delivery models.
---------------------------------------------------------------------------
\4\ Baumle, op. cit.
\5\ ``Scope of Practice Laws and Anesthesia Complications''
(Negrusa, Hogan, Warner, Schroeder, and Pang, 2016). https://
journals.lww.com/lww-medicalcare/abstract/2016/10000/scope_
of_practice_laws_and_anesthesia.4.aspx.
\6\ ``No Harm Found When Nurse Anesthetists Work Without
Supervision By Physicians'' (Dulisse and Cromwell, 2010). https://
www.healthaffairs.org/doi/abs/10.1377/hlthaff.2008.09
66?journalCode=hlthaff.
Some low-quality studies have purported to claim that CRNAs providing
anesthesia without supervision negatively affects outcomes. A 25-year-
old study that was not published in an outside peer-reviewed Journal,
but rather in the Journal run by the American Society of
Anesthesiologists, has major methodological issues that lead the
Centers for Medicare and Medicaid to dismiss the study as too flawed to
be used, stating, ``One cannot use this analysis (Silber) to make
conclusions about CRNA performance with or without physician
supervision.'' This study looked at outcomes for 30-days post operative
period, which is well outside the 48-hour period for anesthesia related
complications. Only the ASA and the American Medical Association (AMA)
continue to push a false narrative that CRNA care is unsafe to protect
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their turf.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Independent Recommendations
The removal of barriers to care and efforts to modernize Medicare and
Medicaid to meet the needs of patients today is critical.
Unfortunately, the AMA, ASA, and others in organized medicine have
continued to misrepresent the skills and education of CRNAs and APRNs,
relied on misleading information and scare tactics to continue to
eliminate competition in ways that inevitably hurts patients. The AMA
has even touted that they have spent millions of dollars to limit the
ability of other providers to practice to the full extent of their
education and training and turned our healthcare system into an
unnecessary and highly political turf battle, that does not serve the
interest of our nation's patients.\7\
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\7\ American Medical Association. May 15, 2023. AMA Successfully
fights scope of practice expansions that threaten patient safety.
https://www.ama-assn.org/practice-management/scope-practice/ama-
successfully-fights-scope-practice-expansions-threaten.
This is why the Federal Trade Commission supported removing unnecessary
barriers to competition for APRNs in a 2014 report, writing,
``Physician supervision requirements may raise competition concerns
because they effectively give one group of health care professionals
the ability to restrict access to the market by another, competing
group of health care professionals, thereby denying health care
consumers the benefits of greater competition. In addition, APRNs play
a critical role in alleviating provider shortages and expanding access
to health care services for medically underserved populations.''\8\
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\8\ Federal Trade Commission. March 2014. Policy Perspectives:
Competition and the Regulation of Advanced Practice Registered Nurses.
https://www.ftc.gov/system/files/documents/reports/policy-perspectives-
competition-regulation-advanced-practice-nurses/140307aprnpolicy
paper.pdf.
Outside of the sphere of healthcare providers, there are numerous
independent groups who have weighed in supporting the removal of
restrictions on CRNAs and other APRNs. Across the ideological spectrum,
groups have weighed in with support for removing barriers in order to
increase access to care and to reduce costs. Among the groups that have
supported the removal of restrictions are the Bipartisan Policy Center,
Americans for Prosperity, The Progressive Policy Institute, the Trump
Administration, the National Rural Health Association, AARP, and
LeadingAge among others.
Critical Provider Nondiscrimination Protections Needed
In addition to efforts by medical associations to reduce competition
and limit availability of high-quality care from APRNs, CRNAs and other
non-MD/DO providers face pressures from insurance companies that also
limit availability of care. Despite Congressional action in the No
Surprises Act requiring the Department of Health & Human Services,
Treasury and Labor to work together to promulgate rulemaking on
provider nondiscrimination, the agencies have continually kicked the
can. We are almost two and a half years past the statutory deadline,
and the agencies have still not done their work to promulgate this
critical rulemaking. Without rulemaking an enforcement, insurers like
Cigna have announced across the board cuts to CRNA reimbursement,
effectively discriminating solely based on licensure and hurting the
rural communities that rely on their services, while at the same time,
Cigna announces record profits, made on the backs of providers and
patients.
Recently, the American Bar Association highlighted how the lack of
rulemaking has allowed insurers to break the law. They have called for
enforcement of the nondiscrimination provision to protect from the
actions of Cigna and other payors, writing, ``such practices have no
sound basis, particularly in light of the recent shift toward quality
and performance based reimbursement.''\9\ Congress needs to hold the
agencies accountable for promulgating rulemaking promptly.
---------------------------------------------------------------------------
\9\ American Bar Association. March 29, 2024. Opinion: Provider
Non-Discrimination Law Continues to be Violated by Insurance Companies.
https://www.americanbar.org/groups/health_
law/section-news/2024/march/opinion-provider-non-discrimination-law-
continues-to-be-violated-by-insurance-companies/.
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Conclusion
Everyone deserves access to timely, high-quality healthcare no matter
where they live. In rural settings, where healthcare delivery is
already complex, CRNAs can fill critical gaps in the existing care
matrix and help our nation deliver on its promise to those who have
served. To fully remove barriers to care for rural communities, we call
on Congress to pass the Improving Care and Access to Nurses Act (S.
2418/H.R. 2713) and to hold the agencies accountable for promulgating
provider nondiscrimination rulemaking that is over two years passed
due.
______
American Association of Nurse Practitioners
Government Affairs
1400 Crystal Drive, Suite 540
Arlington, VA 22202
Website: https://www.aanp.org/
The American Association of Nurse Practitioners (AANP), representing
the 385,000 nurse practitioners (NPs) in the United States, appreciates
the opportunity to provide a statement for the record for the Senate
Committee on Finance hearing entitled ``Rural Health Care: Supporting
Lives and Improving Communities.'' AANP is committed to empowering all
NPs to advance high-quality, equitable care, while addressing health
care disparities through practice, education, advocacy, research, and
leadership (PEARL).\1\ We appreciate the Committee's focus on the
challenges facing patients and providers who live and provide care in
rural communities. We thank Chairman Wyden and Ranking Member Crapo for
holding this hearing which highlighted the importance of access to
high-quality health care to rural communities. Nurse practitioners are
working to meet the health care needs of rural communities across the
country. We look forward to working with the Committee on proactive
policy solutions which will improve access to care for rural
communities and address the challenges faced by rural health care
providers.
---------------------------------------------------------------------------
\1\ https://www.aanp.org/advocacy/advocacy-resource/position-
statements/commitment-to-addressing-health-care-disparities-during-
covid-19 https://www.aanp.org/about/about-the-american-association-of-
nurse-practitioners-aanp/strategic-focus.
As Chairman Wyden accurately stated, ``without rural health care, you
cannot have rural life.''\2\ Rural health care is an issue of
particular importance to nurse practitioners, who provide a significant
portion of health care in rural areas and areas of lower socioeconomic
and health status. The Medicare Payment Advisory Commission (MedPAC)
has found that NPs and PAs comprise approximately one-third of the
primary care workforce, and up to half in rural areas.\3\ When rural
communities experience hospital closures, it is often NPs who are
filling the gaps and providing critical care to these communities.
According to the Government Accountability Office (GAO), an exception
to the pattern of clinicians leaving rural areas after rural hospital
closures were APRNs, finding that ``[c]ounties with rural hospital
closures experienced a greater increase in the availability of advanced
practice registered nurses (61.3 percent), compared to counties without
closures (56.3 percent).''\4\
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\2\ https://www.finance.senate.gov/imo/media/doc/
05162024_wyden_statement.pdf.
\3\ https://www.medpac.gov/wp-content/uploads/2022/06/
Jun22_MedPAC_Report_to_Con
gress_SEC.pdf (see Chapter 2).
\4\ https://www.gao.gov/assets/gao-21-93.pdf.
Along with primary care, MedPAC has also published data on the
importance of NPs providing mental and behavioral health care.\5\ NPs
are also the second largest provider group in the National Health
Services Corps.\6\ As such, they understand the barriers to care that
face vulnerable populations on a daily basis.\7\,
\8\, \9\ They are also ``significantly more likely than
primary care physicians to care for vulnerable populations. Nonwhites,
women, American Indians, the poor and uninsured, people on Medicaid,
those living in rural areas, Americans who qualify for Medicare because
of a disability, and dual-eligibles are all more likely to receive
primary care from NPs than from physicians.''\10\
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\5\ https://www.medpac.gov/wp-content/uploads/2023/06/
Jun23_MedPAC_Report_To_Con
gress_SEC.pdf.
\6\ https://www.hrsa.gov/sites/default/files/hrsa/about/budget/
budget-justification-fy2024.
pdf.
\7\ Davis, M. A., Anthopolos, R., Tootoo, J., Titler, M., Bynum, J.
P. W., & Shipman, S. A. (2018). Supply of Healthcare Providers in
Relation to County Socioeconomic and Health Status. Journal of General
Internal Medicine, 4-6. https://doi.org/10.1007/s11606-017-4287-4.
\8\ Xue, Y., Smith, J. A., & Spetz, J. (2019). Primary Care Nurse
Practitioners and Physicians in Low-Income and Rural Areas, 2010-2016.
Journal of the American Medical Association, 321(1), 102-105.
\9\ Andrilla, C. H. A., Patterson, D. G., Moore, T. E., Coulthard,
C., & Larson, E. H. (2018). Projected Contributions of Nurse
Practitioners and Physicians Assistants to Buprenorphine Treatment
Services for Opioid Use Disorder in Rural Areas. Medical Care Research
and Review, Epub ahead. https://doi.org/10.1177/1077558718793070.
\10\ https://www.aei.org/research-products/report/nurse-
practitioners-a-solution-to-americas-primary-care-crisis/.
NPs provide a substantial portion of the high-quality,\11\ cost-
effective \12\ care that our communities require. As of 2021, there
were over 193,000 NPs billing for Medicare services, making NPs the
largest and fastest growing Medicare designated provider specialty.\13\
Approximately 42% of Medicare patients receive billable services from a
nurse practitioner,\14\ and approximately 80% of NPs are seeing
Medicare and Medicaid patients.\15\
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\11\ https://www.aanp.org/images/documents/publications/
qualityofpractice.pdf.
\12\ https://www.aanp.org/images/documents/publications/
costeffectiveness.pdf.
\13\ https://data.cms.gov/, MDCR Providers 6 Calendar Years 2017-
2021.
\14\ Ibid.
\15\ NP Fact Sheet, https://www.aanp.org/about/all-about-nps/np-
fact-sheet.
We agree with the opening statement by Chairman Wyden, which noted the
unique challenges facing rural health care providers, including
reimbursement, workforce, and barriers; all of which contribute to
providers in rural areas operating on a ``knife's edge.''\16\ Ranking
Member Crapo noted that ``Federal health programs, including Medicare
and Medicaid, have an obligation to serve the unique needs of rural
communities''\17\ and the need to address ``the challenges facing rural
hospitals and providers as they deliver high-quality medical care to
families in environments with more limited resources.''\18\
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\16\ https://www.finance.senate.gov/imo/media/doc/
05162024_wyden_statement.pdf.
\17\ https://www.finance.senate.gov/imo/media/doc/
05162024_crapo_statement.pdf.
\18\ Ibid.
Despite the importance of NPs to the nation's rural health care system,
our members continue to face antiquated statutory barriers which
prevent them from meeting the needs of their communities. NPs receive a
15 percent reduction in reimbursement within the Medicare program and
are ineligible for the 10 percent Health Professional Shortage Area
(HPSA) bonus.\19\ For NPs in rural HPSAs, this equates to a 25-percent
reimbursement differential from their physician colleagues. Further,
Medicare statutes currently prohibit NPs from referring their patients
for therapeutic diabetic shoes, restrict NPs from ordering cardiac and
pulmonary rehabilitation services, and prevent them from performing all
of the mandatory visits in skilled nursing facilities, among other
barriers. All of these policies restrict patient access to care and
prevent the full utilization of an already limited workforce in rural
communities.
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\19\ Physician Bonuses | CMS. https://www.cms.gov/medicare/payment/
fee-for-service-providers/physician-bonuses-health-professional-
shortage-areas-hpsas.
It is critical that federal government policies are updated to reflect
the modern delivery of healthcare. Included below are our suggested
proactive policy solutions to help achieve the important goals
identified by the Committee members including increasing access to care
for rural patients and removing barriers for rural providers. These
bipartisan solutions will equitably reimburse rural providers and
remove anachronistic barriers which inhibit NP's authority to provide
care to their patients. We greatly appreciate your consideration of
this statement and look forward to working with the Committee on these
issues.
Equitable Reimbursement for Nurse Practitioners
As NPs continue to provide increasing amounts of care for Medicare
patients, it is important to understand the significant evolution of
the role of NPs in Medicare. In 1977, Congress first formally
recognized care delivered by nurse practitioners in the Medicare
program in rural health clinics.\20\ In 1989, Congress authorized
direct reimbursement under the Medicare program for services rendered
by nurse practitioners in rural areas, and indirect reimbursement for
NPs rendering services in skilled nursing facilities.\21\ Since 1997,
Congress has authorized reimbursement under the Medicare program to NPs
regardless of setting or geographic area, for any services that would
be covered when provided by a physician, in accordance with State law,
at 85% of the fee schedule rates.\22\
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\20\ https://www.govinfo.gov/content/pkg/STATUTE-91/pdf/STATUTE-91-
Pg1485.pdf.
\21\ https://www.govinfo.gov/content/pkg/STATUTE-103/pdf/STATUTE-
103-Pg2106.pdf.
\22\ 63 FR 30862. https://www.govinfo.gov/content/pkg/FR-1998-06-
05/pdf/98-14650.pdf.
Since this policy was implemented in 1997, despite the increasing
importance of NPs in Medicare, the reimbursement structure has not
changed in over 26 years. NPs are still reimbursed at 85% of the fee
schedule for the services they provide, in contrast to the 100%
reimbursement rate for their physician colleagues. This 15%
differential is for services which require the same amount of work,
time and intensity regardless of the clinician who is providing them.
NPs are required to meet the same standards for billing, include the
same documentation, and provide the same care to patients. This 15%
differential is significant and is in addition to other factors which
impact reimbursement rates, including statutory reductions and
corresponding adjustments to the conversion factor.\23\ This
inequitable reimbursement structure is an anachronism, and does not
reflect the modern health care system.
---------------------------------------------------------------------------
\23\ CY 2024 Medicare Physician Fee Schedule Final Rule. https://
www.cms.gov/newsroom/press-releases/cms-finalizes-physician-payment-
rule-advances-health-equity.
Therefore, we respectfully request that the Committee address the
inequitable reimbursement structure for NPs within the Medicare
program, and ensure any legislation includes equitable reimbursement
for nurse practitioners. This is directly aligned with National Academy
of Medicine Future of Nursing 2020-2030: Charting a Path to Achieve
Health Equity report which states, ``Payment reform can help improve
population health, address social needs and [social determinants of
health], reduce health disparities, supporting the provision of
effective, efficient, equitable, and accessible care for all across the
care continuum instead of incentivizing the volume of care or low value
procedures and practices.''\24\
---------------------------------------------------------------------------
\24\ The Future of Nursing 2020-2030--National Academy of Medicine.
https://nam.edu/publications/the-future-of-nursing-2020-2030/.
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Medicare Payment in Rural Communities
Nurse practitioners are a critical and growing portion of the rural
health care workforce. While reimbursement equity is an important
principle regardless of geographic location, we recognize the unique
challenge of rural communities in addressing clinician shortages. As
previously stated, in the June 2022 report to the Congress, MedPAC
found that NPs and PAs comprise approximately one-third of the primary
care workforce, and up to half in rural areas.\25\
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\25\ https://www.medpac.gov/wp-content/uploads/2022/06/
Jun22_MedPAC_Report_to_Con
gress_SEC.pdf (see Chapter 2).
However, despite the importance of NPs to the health care workforce in
rural and underserved communities, NPs are not eligible for the 10%
Medicare bonus available to their physician colleagues in HPSAs.\26\
According to the Health Resources and Services Administration (HRSA),
there are currently 4,985 rural primary care HPSAs,\27\ and 293
partially rural crime care HPSAs.\28\ There are 3,859 rural mental
health HPSAs, and 378 partially rural mental health HPSAs. For NPs in
all of these HPSAs, ineligibility for the bonus means there can be up
to a 25% difference in reimbursement rates between rural NPs and their
physician colleagues.\29\ This differential is substantial, and impacts
both primary care and mental health HPSAs.
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\26\ Physician Bonuses | CMS. https://www.cms.gov/medicare/payment/
fee-for-service-providers/physician-bonuses-health-professional-
shortage-areas-hpsas.
\27\ Shortage Areas. https://data.hrsa.gov/topics/health-workforce/
shortage-areas.
\28\ Ibid.
\29\ Health Professional Shortage Area Physician Bonus Program.
https://www.hhs.gov/guidance/sites/default/files/hhs-guidance-
documents/HPSAfctshtTextOnly.pdf.
As the Committee considers policy options to better support rural
providers, ensuring NPs practicing in rural and underserved communities
have equitable access to the HPSA Medicare Bonus Program is critical.
Therefore, we respectfully request the Committee update the Medicare
HPSA incentive bonus program to include NPs. This is aligned with the
FY 2025 Department of Health and Human Services (HHS) Budget in Brief
\30\ which included a legislative proposal to broaden the HPSA
incentive program to include NPs. In the request, HHS notes that ``This
proposal responds to the evolving delivery of healthcare in the United
States. Academic research found that the share of medical visits
delivered by nurse practitioners or physician assistants increased from
14 percent to 26 percent among Medicare beneficiaries between 2013 and
2019. Research also found that nurse practitioners make up a larger
share of the primary care workforce in lower income and rural
areas.''\31\
---------------------------------------------------------------------------
\30\ https://www.hhs.gov/sites/default/files/fy-2025-budget-in-
brief.pdf (P. 79).
\31\ Ibid.
Additionally, the confluence of the COVID-19 PHE, opioid epidemic and
behavioral health workforce shortages have led to an ongoing behavioral
health crisis in the United States. According to HRSA, more than one-
third of Americans live within mental health professional shortage
areas.\32\ Data demonstrates that nurse practitioners have been
critical in filling access gaps and providing mental and behavioral
health care to Medicare beneficiaries. A recent study published in
Health Affairs found that from 2011-2019 the number of psychiatric-
mental health NPs (PMHNPs) treating Medicare beneficiaries grew by
162%, compared to a 6% drop in psychiatrists during that same
period.\33\ The study also found that the proportion of all mental
health prescriber visits provided by PMHNPs to Medicare beneficiaries
increased from 12.5% to 29.8% during that same period, exceeding 50% in
rural, full practice authority regions.\34\
---------------------------------------------------------------------------
\32\ 88 FR 52366.
\33\ Trends in Mental Health Care Delivery by Psychiatrists and
Nurse Practitioners in Medicare, 2011-19 | Health Affairs. https://
www.healthaffairs.org/doi/full/10.1377/hlthaff.2022.
00289?journalCode=hlthaff.
\34\ Ibid.
In addition, MedPAC found ``large shifts in the behavioral health
workforce over time: Between 2016 and 2021, substantial growth in
behavioral health services provided by nurse practitioners occurred,
while volume by psychiatrists declined.''\35\ The report also states
that ``we found shifts over time in the specialty of the clinicians who
provide Part B behavioral health services. Most notably, between 2016
and 2021, the volume of these services provided by psychiatrists
declined (5 percent average annual decrease) and rose for nurse
practitioners (12 percent average annual increase).''\36\ Accordingly,
we also support section 101 of the Better Mental Health Care, Lower-
Cost Drugs, and Extenders Act which would expand the HPSA bonuses to
15% for mental health and substance use disorder services provided in
mental health HPSAs by a broader group of clinicians, including NPs.
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\35\ https://www.medpac.gov/wp-content/uploads/2023/06/
Jun23_MedPAC_Report_To_Con
gress_SEC.pdf.
\36\ Ibid.
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Increase Access by Removing Barriers
In the hearing, many Committee members identified the need to remove
administrative barriers which prevent clinicians from practicing to the
full extent of their education and clinical training to fully empower
the rural health care workforce. We strongly agree there is a critical
need to update outdated federal statutes which do not reflect the
modern provision of health care and prevent NPs from fully meeting the
health care needs of their communities. Reports issued by the National
Academies of Medicine,\37\ American Enterprise Institute,\38\ the
Brookings Institution,\39\ the Federal Trade Commission,\40\ the
Bipartisan Policy Center \41\ and the U.S. Department of Health and
Human Services under multiple administrations \42\,
\43\, \44\ have all highlighted the positive impact of
removing barriers confronted by NPs and their patients. The World
Health Organization's State of the World's Nursing 2020 report also
recommends modernizing regulations to authorize APRNs to practice to
the full extent of their education and clinical training, and noted the
positive impact this would have on addressing health care disparities
and improving health care access within vulnerable communities.\45\ As
noted by MedPAC data, the number of encounters per FFS beneficiary with
APRNs and PAs increased by 10.4 percent from 2021-2022.\46\ This
underscores the urgent need for Congressional action to remove these
barriers to care.
---------------------------------------------------------------------------
\37\ The Future of Nursing 2020-2030--National Academy of Medicine.
https://nam.edu/publications/the-future-of-nursing-2020-2030/.
\38\ https://www.aei.org/wp-content/uploads/2018/09/Nurse-
practitioners.pdf.
\39\ https://www.brookings.edu/wp-content/uploads/2018/06/
AM_Web_20190122.pdf.
\40\ https://www.aanp.org/advocacy/advocacy-resource/ftc-advocacy.
\41\ Strengthening the Health Professional Workforce | Bipartisan
Policy Center. https://bipartisanpolicy.org/blog/strengthening-health-
professional-workforce/.
\42\ https://www.hhs.gov/sites/default/files/Reforming-Americas-
Healthcare-System-Through-Choice-and-Competition.pdf.
\43\ https://aspe.hhs.gov/pdf-report/impact-state-scope-practice-
laws-and-other-factors-practice-and-supply-primary-care-nurse-
practitioners.
\44\ https://www.cms.gov/About-CMS/Agency-Information/OMH/
Downloads/Rural-Strategy-2018.pdf.
\45\ https://apps.who.int/iris/bitstream/handle/10665/331673/
9789240003293-eng.pdf.
\46\ https://www.medpac.gov/wp-content/uploads/2024/03/
Mar24_MedPAC_Report_To_Con
gress_SEC.pdf.
As the Committee works on legislation to enhance access to care in
rural communities, we strongly encourage inclusion of the following
bipartisan legislation: the Improving Care and Access to Nurses Act (S.
2418), the Promoting Access to Diabetic Shoes Act (S. 260), the
Increasing Access to Quality Cardiac Rehabilitation Care Act of 2023
(S. 3481), the ACO Assignment Improvement Act (S. 3939), and the Rural
Health Clinic Burden Reduction Act (S. 198). These bipartisan bills
will reduce the administrative burden for NPs and rural communities and
increase needed access to care for patients. This is especially true in
rural communities, where requiring unnecessary visits, referrals or
certifications presents immense challenges for patients.
Improving Care and Access to Nurses (ICAN) Act (S. 2418)
S. 2418 would update the Medicare and Medicaid programs to ensure that
NPs and other APRNs are authorized to provide care as effectively and
efficiently as possible, consistent with state law. This includes
updating Medicare and Medicaid to remove barriers to evidence-based
preventive services such as authorizing NPs to order cardiac and
pulmonary rehabilitation, referring patients for medical nutrition
therapy, certifying patients' needs for diabetic shoes, establishing
home infusion plans of care, and performing mandatory visits in skilled
nursing facilities. This bill does not supersede any state laws, it
simply modernizes these provisions within Medicare and Medicaid to make
them consistent with state law to ensure that beneficiaries have access
to these health care services, from their provider of choice, without
undue burden. This legislation is supported by over 240 national,
state, and local organizations \47\ including the National Rural Health
Association, National Association of Rural Health Clinics, American
Health Care Association, LeadingAge, Americans for Prosperity, and
AARP.\48\ Patients who choose NPs as their health care providers should
not face increased burdens and decreased access to medically necessary
treatment that are covered by Medicare and Medicaid.
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\47\ https://www.aanp.org/news-feed/more-than-235-organizations-
show-their-support-for-the-ican-act.
\48\ https://www.aana.com/comment-letter/aarp-endorsement-of-i-can-
act-hr-2713.
---------------------------------------------------------------------------
Promoting Access to Diabetic Shoes Act (S. 260)
S. 260 would authorize NPs to satisfy the documentation requirement for
coverage of therapeutic shoes for individuals with diabetes. NPs
provide the full range of care to patients with diabetes, but federal
law requires that an NP must send a patient who needs therapeutic shoes
to a physician to certify that need. Additionally, according to current
statute, the certifying physician must take over the treatment of the
patient's diabetic condition going forward. These barriers often lead
to delays in accessing needed items and undermine care continuity. The
estimated total annual cost of an individual patient with diabetes is
$17,000.\49\ However, if left untreated, patients with diabetes may
face serious complications including foot ulcers or amputations,
driving up the estimated annual individual costs to $52,000.\50\ By
removing this outdated and unnecessary barrier, NPs would be authorized
to certify the need for therapeutic shoes for patients with diabetes,
and ensure they get the care they need in a timely fashion.
---------------------------------------------------------------------------
\49\ American Diabetes Association. (2018). Economic Costs of
Diabetes in the U.S. in 2017. Diabetes Care, 41, 917-928. http://
care.diabetesjournals.org/content/diacare/early/2018/03/20/dci18-
0007.full.pdf.
\50\ Agency for Healthcare Research and Quality (2011). Data points
#3: Economic burden of diabetic foot ulcers and amputations. https://
effectivehealthcare.ahrq.gov/topics/diabetes-foot-ulcer-amputation-
economics/research.
For patients in rural communities, this barrier leads to delays in
care. If a patient is seeing an NP for their care, they would then have
to schedule a visit with a physician for the certification of the need
for therapeutic shoes. If the physician is not located within their
community, they would have to drive to that additional certification
appointment. There have been cases where our members are the only
available provider in a community, and a patient has had to drive a
significant distance to receive their certification, which can be made
even more difficult by unreliable transportation options. This barrier
has an acute impact on patients in rural communities, and removal will
---------------------------------------------------------------------------
result in better access to care and outcomes.
Passage of this legislation will also eliminate duplicative services,
potentially saving the Medicare program $12 million annually.\51\ Data
also demonstrates that NPs manage the care for patients with diabetes
in a cost-effective manner that results in health care savings. A
recent study utilizing Veterans Affairs (VA) data from FY 2013 found
significant savings, 6-7% lower costs, for highly complex diabetic
patients who had an NP as their primary provider compared to those with
a physician.\52\ Other researchers found even greater savings, 12-13%
lower costs when examining patients with diabetes with varying degrees
of complexity served by the VA. For a single VA medical center, this
equated to an annual savings of just over $14 million, exemplifying the
efficiency and effectiveness of NP delivered care in the VA.\53\
Patients who choose nurse practitioners as their health care providers
deserve equitable access to care from their chosen health care
provider.
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\51\ Analysis based on author calculations. Approximately 134,000
Medicare patient visits billed using an established patient level 3 E/M
code (CPT 99213).
\52\ Morgan, et al. (2019). Impact of Physicians, Nurse
Practitioners, and Physician Assistants on Utilization and Costs for
Complex Patients. Health Affairs, 38(6), 1028-1036. https://
www.healthaffairs.org/doi/10.1377/hlthaff.2019.00014.
\53\ Rajan, et al. (2021) ``Health care costs associated with
primary care physicians versus nurse practitioners and physician
assistants.'' https://pubmed.ncbi.nlm.nih.gov/34074952/.
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Increasing Access to Quality Cardiac Rehabilitation Care
Act (S. 3481)
S. 3481 would authorize NPs to order cardiac and pulmonary
rehabilitation for Medicare patients. In 2018, Congress passed
legislation which authorized NPs, clinical nurse specialists (CNSs) and
physician assistants (PAs) to supervise cardiac and pulmonary
rehabilitation starting in 2024. However, these clinicians are still
not authorized to order cardiac and pulmonary rehabilitation for
Medicare patients.
Cardiac rehabilitation and pulmonary rehabilitation are programs
designed to improve a patient's physical, psychological, and social
functioning after a qualifying diagnosis or procedure, such as a heart
attack or coronary artery bypass surgery or after a diagnosis of
chronic obstructive pulmonary disease (COPD). Heart disease remains the
leading cause of death in the United States with nearly 700,000 deaths
per year.\54\ Not only does heart disease have a tremendous impact on
the lives of patients and their families, but managing and treating
heart disease and related risk factors is estimated to cost the United
States over $320 billion annually.\55\ Chronic obstructive pulmonary
disease (COPD) is the sixth leading cause of death in the United
States, with nearly 150,000 deaths per year.\56\ COPD is estimated to
cost the United States nearly $50 billion annually in related health
care expenditures and indirect mortality and morbidity costs.\57\
---------------------------------------------------------------------------
\54\ https://www.cdc.gov/heartdisease/about.htm.
\55\ Birger M, Kaldjian AS, Roth GA, Moran AE, Dieleman JL, Bellows
BK. Spending on Cardiovascular Disease and Cardiovascular Risk Factors
in the United States: 1996 to 2016. Circulation. 2021 Jul
27;144(4):271-282. doi: 10.1161/CIRCULATIONAHA.120.053216. Epub 2021
Apr 30. PMID: 33926203; PMCID: PMC8316421.
\56\ https://www.lung.org/research/trends-in-lung-disease/copd-
trends-brief/copd-mortality.
\57\ https://www.lung.org/research/trends-in-lung-disease/copd-
trends-brief/copd-burden.
Yet, while studies show that these programs can reduce
hospitalizations, decrease heart attack recurrence, increase adherence
to preventive medication, improve overall health and reduce the need
for costly care, less than 25 percent of qualifying patients receive
cardiac rehabilitation and only 3 percent of Medicare patients with
COPD receive pulmonary rehabilitation.\58\, \59\,
\60\ Participation rates are even lower for female and minority
patients and those who live outside metropolitan areas or in lower
income urban areas.\61\, \62\ Research also indicates that
cardiac rehabilitation is associated with lower all-cause mortality
rates in patients with diabetes, however patients with diabetes have
lower participation rates than the non-diabetes population.\63\ It is
essential that Congress increase access to these vital services.
---------------------------------------------------------------------------
\58\ https://millionhearts.hhs.gov/data-reports/factsheets/
cardiac.html.
\59\ https://www.ahajournals.org/doi/10.1161/
CIRCOUTCOMES.119.005902.
\60\ https://www.atsjournals.org/doi/10.1513/AnnalsATS.201805-
332OC.
\61\ Li S, Fonarow GC, Mukamal K, Xu H, Matsouaka RA, Devore AD,
Bhatt DL. Sex and Racial Disparities in Cardiac Rehabilitation Referral
at Hospital Discharge and Gaps in Long-Term Mortality. J Am Heart
Assoc. 2018 Apr 6;7(8):e008088. doi: 10.1161/JAHA.117.008088. PMID:
29626153; PMCID: PMC6015394.
\62\ Castellanos LR, Viramontes O, Bains NK, Zepeda IA. Disparities
in Cardiac Rehabilitation Among Individuals from Racial and Ethnic
Groups and Rural Communities--A Systematic Review. J Racial Ethn Health
Disparities. 2019 Feb;6(1):1-11. doi: 10.1007/s40615-018-0478-x. Epub
2018 Mar 13. PMID: 29536369.
\63\ https://www.ahajournals.org/doi/10.1161/JAHA.117.006404.
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Rural Health Clinic Burden Reduction Act (S. 198)
NPs are essential providers in the over 5,300 federally certified rural
health clinics that provide primary care services to more than 37.7
million people in 45 states.\64\ Despite the importance of NPs in RHCs,
outdated statutory requirements exist which prevent RHCs from utilizing
the full extent of NPs education and clinical training. Therefore, we
strongly support the inclusion of the Rural Health Clinic Burden
Reduction Act (S. 198) in any legislation released by the Committee
pursuant to this hearing. This important legislation increases
operational flexibility for RHCs by expanding NPs authority to provide
care in these settings. This bill also provides broader modernization
for RHCs by updating the RHC statutes, some of which have not been
updated since the RHC program was established in 1977.
---------------------------------------------------------------------------
\64\ NARHC--National Association of Rural Health Clinics. https://
www.narhc.org/narhc/ESX_About_Us.asp.
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ACO Assignment Improvement Act (S. 3939)
The Medicare Shared Savings Program (MSSP) is an important component of
Medicare, which saved more than 1.8 billion dollars in 2022.\65\ Over
140,000 NPs are participating in MSSP ACOs, providing critical services
to millions of Medicare beneficiaries within the program.\66\ However,
statutory requirements \67\ still exist which require a beneficiary to
receive a primary care service from a physician as a pre-step before
they can be assigned to a MSSP accountable care organization (ACO).
This requirement inhibits the ability of Medicare to equitably provide
accountable care and limits the participation of patients who see NPs
as their primary care providers. Therefore, we strongly support the
passage of the ACO Assignment Improvement Act (S. 3939) which would
address this barrier and fully include NPs and their patients in the
MSSP.
---------------------------------------------------------------------------
\65\ Medicare Shared Savings Program Saves Medicare More Than $1.8
Billion in 2022 and Continues to Deliver High-quality Care | CMS.
https://www.cms.gov/newsroom/press-releases/medicare-shared-savings-
program-saves-medicare-more-18-billion-2022-and-continues-deliver-high.
\66\ https://data.cms.gov/medicare-shared-savings-program/
performance-year-financial-and-quality-results/data. (January 2022
Performance Year Financial and Quality Results.)
\67\ Social Security Act Section 1899(c)(1).
In the 2024 PFS final rule, the Centers for Medicare and Medicaid
Services (CMS) finalized updates to better include patients seen by NPs
into the MSSP, and better align beneficiaries with the clinician who is
providing their care.\68\ The CMS analysis of the expansion of the
assignment methodology to better account for NPs' patients notes that
the changes would add a population of patients who have been
historically underrepresented in the MSSP.\69\ This includes those with
a disabled Medicare enrollment type, those residing in areas with a
slightly higher average ADI national percentile rank, and a larger
share of Medicare Part D LIS enrollment. This is consistent with the
June 2022 MedPAC report which found that, among all clinician types,
NPs on average had the highest share of allowed charges associated with
low-income subsidy (LIS) beneficiaries. ``In 2019, 41 percent of the
allowed charges billed by NPs who practiced in primary care were for
LIS beneficiaries, as were 36 percent for NPs who practiced in
specialty care compared with 28 percent for primary care physicians and
PAs and 25 percent for specialty care physicians and PAs.''\70\
---------------------------------------------------------------------------
\68\ P. 961 2024 PFS Final Rule. https://public-
inspection.federalregister.gov/2023-24184.pdf.
\69\ 88 FR 52440. https://www.federalregister.gov/documents/2023/
08/07/2023-14624/medicare-and-medicaid-programs-cy-2024-payment-
policies-under-the-physician-fee-schedule-and-other.
\70\ https://www.medpac.gov/wp-content/uploads/2023/03/
Mar23_MedPAC_Report_To_Con
gress_SEC.pdf (Page 135).
In its FY 2021 Budget in Brief, HHS stated that basing ACO-assignment
on a broader set of primary care providers, including NPs, better
reflects our current primary care workforce and would lead to $80
million in savings for the Medicare program over 10 years.\71\ However,
statutory barriers still need to be fixed to fully include NPs and
their patients in the program. Therefore, we respectfully request the
Committee include S. 3939 in any legislative efforts pursuant to this
hearing to fully include NPs and their patients in the MSSP.
---------------------------------------------------------------------------
\71\ HHS, https://www.hhs.gov/sites/default/files/fy-2021-budget-
in-brief.pdf (page 84).
---------------------------------------------------------------------------
Permanent Medicare Coverage of Increased Telehealth Access
Telehealth has been a vital lifeline throughout the COVID-19 PHE to
reach patients who otherwise would not be able to receive care and it
will continue to be an essential access tool moving forward. We thank
Congress for extending the Medicare telehealth flexibilities through
the end of 2024 and urge the permanent adoption of those policies. In a
2020 AANP member survey on the impacts of COVID-19, 76% of nurse
practitioners identified federal telehealth waivers as some of the most
beneficial flexibilities throughout the COVID-19 PHE.\72\ NPs have made
a rapid transition to telehealth, with over half of AANP members
reporting their practices have adopted, or increased the use of,
telehealth and virtual platforms. According to the United States Health
Resources and Services Administration (HRSA), there are 4,986 rural
primary care HPSAs and 2,157 non-rural primary care HPSAs.\73\ Adequate
access to providers impacts patients in both rural and non-rural
geographic settings. Permanently removing the restrictions that prevent
Medicare patients in certain geographic areas from accessing telehealth
is increasingly important.
---------------------------------------------------------------------------
\72\ Nurse Practitioner COVID-19 Survey. https://www.aanp.org/
practice/practice-related-research/research-reports/nurse-practitioner-
covid-19-survey-2.
\73\ Shortage Areas. https://data.hrsa.gov/topics/health-workforce/
shortage-areas.
The expanded coverage of certain services throughout the PHE, including
audio-only care, have also enabled NPs and other clinicians to reach
patients who otherwise may have been unable to receive medically
necessary healthcare, particularly in rural and underserved communities
and for patients with behavioral health needs. Coverage of audio-only
telehealth has been critical for NPs and patients who do not have
access to adequate broadband or technological devices capable of
synchronous two-way audio video technology. In the survey previously
noted, AANP members reported that the three most significant barriers
to telehealth adoptions were patient connectivity issues, patient
access to technology and the internet and patient comfort with
technology.\74\ For patients experiencing issues that prohibit them
from utilizing synchronous two-way technology, the permanent coverage
of audio-only visits will be an important component of telehealth
moving forward.
---------------------------------------------------------------------------
\74\ Nurse Practitioner COVID-19 Survey. https://www.aanp.org/
practice/practice-related-research/research-reports/nurse-practitioner-
covid-19-survey-2.
As Congress further considers telehealth legislation, we respectfully
request that increased coverage of telehealth removes barriers to care,
and that policies intended to maintain program integrity are flexible
and do not inadvertently inhibit patient access to care. Important
policy changes include the permanent coverage of audio-only services,
and removal of geographic and site restrictions for telehealth services
for Medicare beneficiaries.
Support Robust Nursing Education Programs
In addition to supporting the current healthcare workforce, it is
important for the Committee to support the future healthcare workforce
and ensure that we have a strong pipeline of clinicians to address
healthcare workforce shortages. AANP supports the Educating Future
Nurses Act (S. 1586) which would establish a permanent National
Graduate Nurse Education (GNE) Program to provide clinical training to
APRNs, particularly with respect to services for Medicare
beneficiaries. This builds off a successful temporary GNE program which
``led to 54 and 67 percent increases in APRN student enrollment and
graduations, respectively.''\75\ Establishing a permanent program will
help ensure that our healthcare system continues to have a robust
network of APRNs to meet our nation's healthcare needs.
---------------------------------------------------------------------------
\75\ https://www.cms.gov/priorities/innovation/files/reports/gne-
final-eval-rpt-fg.pdf.
---------------------------------------------------------------------------
Conclusion
We are deeply appreciative of the Committee's recognition of the need
to enhance access to care in rural and underserved communities. We
thank the Committee for focusing on improving our nation's health care
system and look forward to working with the Committee on solutions that
will expand access to care for patients.
______
American Hospital Association
800 10th Street, NW
Two CityCenter, Suite 400
Washington, DC 20001-4956
(202) 638-1100
https://www.aha.org/
On behalf of our nearly 5,000 member hospitals, health systems and
other health care organizations; our clinician partners--including more
than 270,000 affiliated physicians, 2 million nurses and other
caregivers; and the 43,000 health care leaders who belong to our
professional membership groups, the American Hospital Association (AHA)
welcomes the opportunity to comment on policies to ensure rural
patients continue to receive access to high-quality care.
Hospitals and health systems are the lifeblood of their communities and
committed to ensuring local access to health care. At the same time,
many hospitals, including those in rural areas, continue to experience
unprecedented challenges that jeopardize access and services. These
include workforce shortages, high costs of prescription drugs, and
continued severe underpayment by Medicare and Medicaid.
Rural hospitals make up about 35% of all hospitals in the U.S. Nearly
half of rural hospitals have 25 or fewer beds, with just 16% having
more than 100 beds. Given that rural hospitals tend to be much smaller,
patients with higher acuity often travel or are referred to larger
hospitals nearby. As a result, in rural hospitals, the acute care
occupancy rate (37%) is less than two thirds of their urban
counterparts (62%).
Below are a series of proposals and suggestions for the Finance
Committee to consider as it seeks to ensure financial stability of
providers, maintain critical flexibility to protect access and
services, build the workforce of tomorrow and improve infant and
maternal care in rural communities.
FLEXIBLE PAYMENT OPTIONS
To improve health care in rural communities, sustainable financing for
rural hospitals and health systems is imperative. As a result, rural
hospitals require flexible payment options to address barriers and
invest in new resources in rural communities.
Providing certainty and stability in rural Medicare hospital payments
is essential. Low reimbursement, low patient volume, sicker patients
and challenging payer mix, common at many rural hospitals, puts added
financial pressure on those facilities. The AHA supports policies that
promote flexible payment options and address financial challenges faced
by the full spectrum of rural hospitals, which will allow them to
continue providing high-quality care for their patients.
Making Permanent the Medicare-dependent Hospital (MDH) and Low-
volume Adjustment (LVA). MDHs are small, rural hospitals where at least
60% of admissions or patient days are from Medicare patients. MDHs
receive the inpatient prospective payment system (IPPS) rate plus 75%
of the difference between the IPPS rate and their inflation-adjusted
costs from one of three base years. AHA supports making the MDH program
permanent and adding an additional base year that hospitals may choose
for calculating payments. The LVA provides increased payments to
isolated, rural hospitals with a low number of discharges. AHA also
supports making the LVA permanent. The MDH designation and LVA protect
the financial viability of these hospitals to ensure they can continue
providing access to care and AHA supports the Rural Hospital Support
Act (S. 1110) and the Assistance for Rural Community Hospitals Act
(H.R. 6430) to extend those important designations.
Extend Telehealth Flexibilities. The expansion of telehealth
services has transformed care delivery, expanded access for millions of
Americans and increased convenience in caring for patients, especially
those with transportation or mobility limitations. Given current health
care challenges, including major clinician shortages nationwide,
telehealth holds tremendous potential to leverage geographically
dispersed provider capacity to support patient demand. AHA supports the
CONNECT for Health Act (S. 2016/H.R. 4189) to make permanent coverage
of certain telehealth services made possible during the pandemic,
including lifting geographic and originating site restrictions,
allowing Rural Health Clinics and Federally Qualified Health Centers to
serve as distant sites, expanding practitioners who can provide
telehealth, and allowing the continuation of audio-only telehealth
services, among others.
Reopen the Necessary Provider Designation for Critical Access
Hospitals (CAHs). The CAH designation allows small rural hospitals to
receive cost-based Medicare reimbursement, which can help sustain
services in the community. Hospitals must meet several criteria,
including a mileage requirement, to be eligible. A hospital can be
exempt from the mileage requirement if the state certified the hospital
as a necessary provider, but only hospitals designated before Jan. 1,
2006, are eligible. AHA urges Congress to reopen the necessary provider
CAH program to further support local access to care in rural areas.
Strengthen the Rural Emergency Hospital (REH) Model. REHs are a
new Medicare provider type to which small rural and critical access
hospitals can convert to provide emergency and outpatient services
without needing to provide inpatient care. AHA supports strengthening
and refining the REH model to ensure sustainable care delivery and
financing.
Rebase Sole Community Hospitals (SCHs). SCHs must show they are
the sole source of inpatient hospital services reasonably available in
a certain geographic area to be eligible. AHA supports the Rural
Hospital Support Act (S. 1110) to add an additional base year that SCHs
may choose for calculating their payments.
Improve Access to Capital. Access to capital is important to
stabilize a vulnerable hospital or advance innovations in others. AHA
supports expanding the USDA Community Facilities Direct Loan & Grant
Program and creating a new Hill-Burton like program to update rural
hospitals to ensure continued access in rural communities.
FINANCIAL STABILTY--FAIR, TIMELY AND ADEQUATE REIMBURSEMENT
Medicare and Medicaid each pay less than 90 cents for every dollar
spent caring for patients--with Medicare hitting a historic low of 82
cents for every dollar--according to the latest AHA data. Given the
unique financial challenges of providing care in rural areas,
reimbursement rates across payers need to be updated to cover the cost
of care.
AHA supports the following policies to ensure fair, timely and adequate
reimbursement.
Medicare Advantage Payment Parity for CAHs. The Medicare
Advantage (MA) program has grown significantly in the past decade. MA
enrollment, which traditionally has grown slower in rural areas, is now
surpassing the growth rate in urban areas. For example, MA enrollment
quadrupled between 2010 to 2023 in rural counties, compared to
metropolitan areas which doubled in enrollment during the same period.
Yet, MA plans are not required to pay CAHs at the same cost basis as
fee-for-service Medicare; and they are increasingly paying below costs,
straining the financial viability of many rural providers. Further, MA
plans have the additional burden of prior authorization and other
health plan requirements with which rural providers must increasingly
contend--requirements that do not exist to nearly the same extent in
fee-for-service Medicare and add additional costs for rural providers
to comply. We support legislation to ensure CAHs receive cost-based
reimbursement for MA patients.
Prompt Pay. Ensuring prompt payment from insurers for medically
necessary, covered health care services is important for ensuring
financial stability of rural hospitals and health systems. Delayed
payments are particularly problematic for rural hospitals given their
low patient volume and often challenging financial position. We support
policies to increase oversight and accountability of health plans
including establishing more stringent standards for timely payment to
address certain commercial insurer tactics to delay and deny payment to
health care providers.
Make the Ambulance Add-on Payments Permanent. Rural ambulance
service providers ensure timely access to emergency medical care but
face higher costs than other areas due to lower patient volume. We
support, permanently extending the existing rural, ``super-rural'' and
urban ambulance add-on payments to protect access to these essential
services. AHA asks Congress to pass the Protecting Access to Ground
Ambulance Medical Services Act of 2023 (S. 1673/H.R. 1666) to maintain
those enhanced ambulance payments.
Commercial Insurer Accountability. Systematic and inappropriate
delays of prior authorization decisions and payment denials by
commercial insurers for medically necessary care are putting patient
access to care at risk. We support regulations and legislative
solutions that streamline and improve prior authorization processes,
including the Improving Seniors' Timely Access to Care Act, which would
codify many of the reforms in the Interoperability and Prior
Authorization Final Rule. In addition, we support policies that ensure
patients can rely on their coverage by disallowing health plans from
inappropriately delaying and denying care, including by making
unilateral mid-year coverage changes.
Wage Index Floor. AHA supports the Save Rural Hospitals Act (S.
803) to place a floor on the area wage index, effectively raising the
area wage index with new money for hospitals below that threshold.
Behavioral Health. Implementing policies to better integrate and
coordinate behavioral health services will improve care in rural
communities. We urge Congress to:
Fully fund authorized programs to treat
substance use disorders, including expanding access to
medication assisted treatment.
Implement policies to better integrate and
coordinate behavioral health services with physical health
services.
Enact measures to ensure vigorous enforcement
of mental health and substance use disorder parity laws.
Permanently extend flexibilities under scope of
practice and telehealth services granted during the COVID-19
public health emergency.
Increase access to care in underserved
communities by investing in supports for virtual care and
specialized workforce.
BOLSTERING THE WORKFORCE
Recruitment and retention of health care professionals is an ongoing
challenge and expense for many hospitals. Nearly 70% of the primary
health professional shortage areas are in rural or partially rural
areas. Hospitals and health systems need a robust and highly qualified
staff to handle medical care in emergency situations. To achieve this
goal, targeted programs that help address workforce shortages in rural
communities should be supported and expanded. Workforce policies and
programs also should encourage nurses and other allied professionals to
practice at the top of their licenses. Below are listed a variety of
different proposals and pieces of legislation Congress should consider
enacting to tackle the workforce shortage crisis.
Graduate Medical Education. We urge Congress to pass the
Resident Physician Shortage Reduction Act of 2023 (S. 1302/H.R. 2389),
legislation to increase the number of Medicare-funded residency slots,
which would expand training opportunities in all areas including rural
settings to help address health professional shortages.
Conrad State 30 Program. We urge Congress to pass the Conrad
State 30 and Physician Access Reauthorization Act (S. 665/H.R. 4942) to
extend and expand the Conrad State 30 J-1 visa waiver program, which
waives the requirement to return home for a period if physicians
holding J-1 visas agree to stay in the U.S. for 3 years to practice in
federally-designated underserved areas.
International Workforce. The AHA urges Congress to pass the
Healthcare Workforce Resilience Act (S. 3211/H.R. 6205), bipartisan
legislation that would recapture 25,000 unused employment-based visas
for foreign-born nurses and 15,000 for foreign-born physicians to help
address staffing shortages.
Loan Repayment Programs. We urge Congress to pass the Restoring
America's Health Care Workforce and Readiness Act (S. 862) to
significantly expand National Health Service Corps funding to provide
incentives for clinicians to practice in underserved areas, including
rural communities. AHA also supports the Rural America Health Corps Act
(S. 940/H.R. 1711) to directly target rural workforce shortages by
establishing a Rural America Health Corps to provide loan repayment
programs focused on underserved rural communities.
Boost Nursing Education. We urge Congress to invest significant
resources to support nursing education and provide resources to boost
student, faculty and preceptor populations, modernize infrastructure
and support partnerships and research at schools of nursing. AHA also
supports expanding the National Nurse Corps.
Health Care Workers Protection. We urge Congress to enact the
Safety from Violence for Healthcare Employees Act (S. 2768/H.R. 2584)
to provide federal protections for health care workers against violence
and intimidation.
IMPROVING MATERNAL HEALTH IN RURAL COMMUNITIES
The AHA and its hospitals and health systems are dedicated to
eliminating maternal mortality and reducing maternal morbidity to
provide mothers and babies with the opportunity to lead healthy and
productive lives. Last year, we released a comprehensive set of federal
public policy and legislative solutions for improving maternal health.
In addition, the AHA has shared tools and resources and promoted the
fields' efforts through case studies, webinars and podcasts.
Over the last decade, more than 200 rural hospitals have closed
obstetric (OB) units. The decision to close an OB unit is not made
lightly. Hospitals and health systems consider various factors,
including patient care, staffing challenges, declining patient volume
and inadequate reimbursement, in addition to the important role they
play in their communities and the lives of their patients. A recent
Government Accountability Office study \1\ estimated that half of all
rural counties lack access to this essential care.
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\1\ https://www.gao.gov/products/gao-23-105515.
As Congress examines this issue more closely, we would encourage
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legislative approaches that focus on:
Increasing reimbursement for obstetric services. For example,
some states have implemented add-on payments for labor and delivery--
paid directly to the hospital--by their state Medicaid programs; a
federal match could be helpful in maintaining and expanding the use of
these payments.
Reducing regulatory barriers to encourage partnerships and
innovative approaches to delivering care. Partnerships between smaller
rural hospitals and larger health systems can allow systems to share
staff, connect patients with complex health needs to specialists, and
in some cases, transfer high-risk pregnant women to other facilities.
Encouraging state Medicaid graduate medical education (GME)
programs to support expanding capacity of existing workforce. States
have broad authority to create Medicaid GME programs that meet the
needs of their state, including through fee-for-service and Medicaid
managed care programs. In some states, primary care or family
practitioners have received training in labor and delivery, including
performing cesarean sections, to offer care as part of a broader
clinical team that includes obstetricians and gynecologists. CMS could
assist with guidance and encourage state Medicaid agencies to develop
Medicaid GME programs focused on rural hospitals that provide maternity
care.
Requiring state Medicaid programs to cover telemedicine for
maternal care. Telehealth can provide support throughout the perinatal
period as well to allow for consultations with specialists and access
to care for rural areas that do not have obstetric providers.\2\ A
study by the CDC examined work done by 13 state maternal mortality
review committees to identify contributing factors and strategies to
prevent future pregnancy-related deaths, which included addressing
personnel issues at hospitals by providing telemedicine for facilities
with no obstetric provider on-site.\3\ In addition, the use of remote
patient monitoring, such as with blood pressure cuffs weekly glucose
review, both lowered pregnancy-related stress and improved patient
satisfaction with their treatment. While the use of telemedicine for
obstetric services has increased over the last few years, not all
states may be requiring Medicaid to reimburse for these services.
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\2\ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC9639859/#bib5.
\3\ https://www.cdc.gov/mmwr/volumes/68/wr/
mm6818e1.htm?s_cid=mm6818e1_w&T3_
down.
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CONCLUSION
We thank you for the opportunity to comment on ways to improve rural
health care and strengthen the communities that rely on the services
provided by their local hospitals and health systems. We look forward
to continuing to work with you on this important issue.
Links:
https://www.aha.org/system/files/media/file/2023/09/Federal-Public-
Policy-Legislative-Solutions-Improving-
Maternal%20Health_August%202023_Final.pdf
https://www.aha.org/advocacy/maternal-and-child-health
______
American Medical Association
AMA Plaza
330 N. Wabash Ave., Suite 39300
Chicago, IL 60611-5885
(312) 464-4782
https://www.ama.assn.org
The American Medical Association (AMA) appreciates the opportunity to
submit the following Statement for the Record to the U.S. Senate
Committee on Finance as part of the hearing entitled, ``Rural Health
Care: Supporting Lives and Improving Communities.'' This hearing is
critically important as it focuses on the ability of rural communities
to access quality health care and highlights innovative solutions that
these communities need to overcome persistent health care challenges.
The AMA commends the Committee for its consideration of this important
issue aimed at, among other things, ensuring the continuation of
certain programs and policy flexibilities granted as part of the
response to the COVID-19 pandemic that help ensure patients retain
access to at-home care. The COVID-19 pandemic made clear that rural and
underserved areas that have historically lacked adequate access to
health care services can greatly benefit from permanent legislative and
regulatory flexibilities. As a result, we applaud the Committee for
recognizing the importance of promoting health equity as it considers
which COVID-19 policies to retain to facilitate continued access to
home-based care. In addition, we urge Congress to consider how making
many of these existing flexibilities permanent will provide the
necessary assurances that physicians, health care organizations, and
patients may need before investing additional resources into policies
such as telehealth and the Hospital at Home program.
INNOVATION MODELS AND TECHNOLOGY
The AMA strongly recommends that Congress permanently lift the
restrictions on access to telehealth services for Medicare patients by
passing the ``Creating Opportunities Now for Necessary and Effective
Care Technologies (CONNECT) for Health Act'' (S. 2016/H.R. 4189), and
the ``Telehealth Modernization Act'' (S. 3967/H.R. 7623). Given that we
are in the middle of a national physician workforce crisis, telehealth
continues to provide critical access for patients across the country in
various settings.
The AMA Supports the CONNECT for Health Act and the Telehealth
Modernization Act (S. 3967/H.R. 7623)
The CONNECT for Health Act is bipartisan legislation that would
permanently extend many important COVID-19 telehealth flexibilities
that have significantly improved access to care for patients in rural
and underserved areas. More specifically, the bill repeals the existing
Medicare geographic site restrictions and permanently modifies the
originating site requirements to allow patients to receive telehealth
services wherever the patient can access a telecommunications system,
including, but not limited, to the home. These COVID-19 policies have
allowed patients to obtain telehealth services at home instead of
having to travel to a medical facility to receive virtual care from a
distant site. They have also allowed Medicare patients located in urban
and suburban areas to have access to telehealth services for the first
time. The CONNECT for Health Act currently has 65 cosponsors, an
overwhelming majority of supporters in the Senate and, as a result,
should be passed expeditiously.
COVID-19 flexibilities also enabled patients to access health care
services through audio-only visits when they do not have reliable
access to two-way audio-video telecommunications technology. Therefore,
passage of the Telehealth Modernization Act is crucial because, in
addition to eliminating the geographic and originating site
restrictions, thus allowing rural, urban, and suburban patients to
receive telehealth services wherever they can access a
telecommunications system, the legislation permanently continues the
ability to use audio-only telehealth services beyond the current
statutory deadline of December 31, 2024. Access to two-way audio-visual
telehealth and audio-only services has lowered or eliminated barriers
that many patients in rural and underserved areas face when trying to
obtain in-person care, such as functional limitations that make it
difficult to travel to physician offices, long travel times, workforce
shortages, the need for a caregiver to accompany the patient, and
patients experiencing unstable housing and lack of transportation and
childcare. Also, in an effort to boost access to virtual mental health
services, both the CONNECT for Health Act and the Telehealth
Modernization Act repeal the requirement within the Consolidated
Appropriations Act, 2021, requiring patients to see a physician in-
person within 6 months of an initial telehealth visit for a mental
health condition. Federal lawmakers have also introduced stand-alone
bills, specifically S. 3651/H.R. 3432, the ``Telemental Health Care
Access Act,'' to remove these in-person visit requirements that will
only stifle access to mental health services. While federal lawmakers
have, thus far, passed legislation delaying the mandate for patients to
receive an in-person visit within 6 months of receiving an initial
telemental health service from taking effect, it is crucial this policy
is permanently removed to ensure patients retain ample access to
virtual mental health services. Absent Congressional intervention, the
in-person telemental health requirements will go into effect on January
1, 2025, so it is crucial legislative action occurs expeditiously.
The AMA Supports H.R. 8261, the ``Preserving Telehealth, Hospital, and
Ambulance Access Act''
As an interim step, the AMA also recommends that Congress pass H.R.
8261, the ``Preserving Telehealth, Hospital, and Ambulance Access
Act.'' This important legislation will extend through 2026 many of the
above telehealth provisions we strongly support including audio-only
telehealth services, exemptions to geographic and originating site
restrictions, and delaying the in-person requirements for telemental
health services.
This bill also extends the Acute Hospital at Home Waiver Flexibilities
through 2029. On March 11, 2023, the AMA along with other
organizations, including medical groups participating in the Acute
Hospital Care at Home (AHCaH) waiver program, submitted a request to
Congress asking for at least a 5-year extension of AHCaH before its
expiration at the end of 2024. Without an extension, Medicare
beneficiaries will lose access to AHCaH programs that have demonstrated
excellent clinical outcomes and lower the costs of care. With an
expiration set for the end of this year, medical groups, and health
systems nationwide need assurance that this waiver program will be
extended if they are going to invest their resources into logistics,
supply chain, and workforce for AHCaH.
Although our ultimate goal is that these flexibilities are made
permanent to facilitate greater long-term investment in virtual care
for the betterment of patients, we are glad Congress is prioritizing
legislative action to extend the telehealth services currently
scheduled to lapse at the end of the year and we urge that this
extension be kept clean of guardrails that will serve to limit patient
access to care.
The AMA Opposes H.R. 1746, the Preventing Medicare Telefraud Act
The AMA strongly opposes any efforts to impose other types of
antiquated ``guardrails'' pertaining to telehealth services. The AMA
views telehealth as a method to deliver care, and creating significant
burdens to access these services in the name of program integrity
requires substantial justification. As a result, the AMA strongly
opposes H.R. 1746, the ``Preventing Medicare Telefraud Act,'' or any
other legislation that promotes similar policies.
This legislation requires a patient to receive an in-person visit
within 6 months of receiving ``high-cost'' durable medical equipment
(DME) and laboratory tests ordered via telehealth. This provision makes
little sense as it is impossible clinically for a physician to know if
the patient will need high-cost DME or laboratory tests prior to
receiving a telehealth visit. Under this legislation, ``high cost'' DME
and laboratory tests would also be defined by the Centers for Medicare
& Medicaid Services (CMS) Administrator, which the AMA believes to be
an excessive expansion of executive authority.
In addition, H.R. 1746 stipulates that, beginning 6 months after the
effective date of the high-cost DME/lab clause, Medicare Administrative
Contractors (MACs) shall conduct reviews on a schedule determined by
the HHS Secretary of all claims of high cost DME/lab tests ordered over
the preceding 12 months when at least 90 percent of these services are
prescribed by a physician/provider via telehealth. Again, since
telehealth is simply a modality, the AMA believes such audits are not
appropriate or necessary because it provides no consideration of
medical necessity.
In general, the AMA urges members of the Senate Finance Committee to
reject any inclination to establish additional guardrails, including
in-person visits or mandatory audits, in the name of rooting out fraud,
waste, and abuse. The AMA believes these concerns are misplaced given
CMS' existing tools for combating fraud and abuse, the increased
ability telehealth services provide for documentation and tracking, and
the lack of data to suggest that fraud and abuse or duplication of
services are of particular concern for telehealth services.
The AMA believes existing HHS and OIG fraud capabilities and
authorities are more than adequate to police telehealth services in the
same way they oversee in-person Medicare services. A February 2024 HHS
OIG report confirms this reality.\1\ For 105 out of the 110 sampled
Evaluation and Management (E/M) services provided via telehealth during
the early parts of the pandemic, physicians appropriately complied with
Medicare requirements. As a result, OIG did not provide any policy
recommendations to CMS because, ``. . . providers generally met
Medicare requirements when billing for E/M services provided via
telehealth and unallowable payments we identified resulted primarily
from clerical errors or the inability to access records.'' Medicare
fraud is still Medicare fraud, irrespective of whether it involved
telehealth services.
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\1\ https://oig.hhs.gov/oas/reports/region1/12100501.asp.
In February 2021, HHS's Principal Deputy Inspector General (OIG)
released a statement dispelling any concerns with OIG's authority or
ability to address concerns of fraud and abuse. Instead, HHS OIG's
statement highlights that concerns stem from ``telefraud'' schemes,
rather than ``telehealth fraud,'' in which bad actors use
``telehealth'' as a basis for fraudulent charges for medical equipment
or prescriptions which are unrelated to the telehealth service at
issue. In those cases, fraudulent actors typically do not bill for the
telehealth visit but instead use the sham telehealth visit to induce a
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patient to agree to receive unneeded items and gather their info.
Moreover, telehealth services may prove even easier to monitor for
fraud and abuse because of the digital footprint created by these
services, state practice of medicine laws requiring documentation of
these services, and the ability to track their usage with Modifier 95.
CMS has also implemented Place of Service (POS) indicators for this
purpose, including POS 02 when the originating site is someplace other
than the patient's home and POS 10 when the patient is in their home.
Additional indicators may be used for asynchronous services and home
health services provided via telehealth. Telehealth services are even
more likely to have electronic documentation in medical record systems
than in-person services. Practice of medicine laws in all 50 states
permit physicians to establish relationships with patients virtually so
long as it is appropriate for the service to be received via
telehealth. In addition, two-way audio-visual services can be
effectively deciphered and tracked by CMS via Modifier 95 and other CMS
indicators.
The State of Health at Home Models: Key Considerations and
Opportunities
Building on existing playbooks and resources supporting digitally
enabled care, the AMA conducted research to explore the different ways
health care is and can be provided in the home. The AMA report titled,
``The State of Health at Home Models: Key Considerations and
Opportunities'' offers a comprehensive guide that outlines the concept
and benefits of delivering care to patients in their home
environments.\2\ These include recommendations for physicians to:
Determine whether your practice or organization should build your
health at home program internally or partner with another organization;
consider required training to strengthen your mobile workforce, which
is a core component of health at home programs; ensure you understand
the unique and varied circumstances of each home environment and plan
for the patient and caregiver experience in detail; develop the
infrastructure up front that will provide the necessary tools to
appropriately handle the flow of resources and information to provide
patient care as required by your specific program.
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\2\ https://www.ama-assn.org/system/files/health-at-home-
models.pdf.
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Future of Health Case Study: Atrium Health
This case study highlights how this vision is being accomplished
through a strategic partnership between a traditional brick-and-mortar
health system and a technology company, with a common goal to build and
scale a program that enables patients to continue their care and
recovery at home. Each organization brings its expertise to the
partnership, enabling thoughtful development and implementation of a
complex, digitally enabled clinical initiative.
Payment and Delivery in Rural Hospitals
In this issue brief, the AMA reports on background, challenges, costs,
and strategies related to the delivery of care in rural hospitals.
Additionally, this includes strategies to improve rural health and
hospital viability.
ASPE Report--Updated Medicare FFS Telehealth Trends by Beneficiary
Characteristics, Visit Specialty, and State, 2019-2021
This report by the Assistant Secretary for Planning and Evaluation
(ASPE) reveals sustained above-pre-pandemic levels of telehealth
utilization among Medicare beneficiaries, notably for behavioral health
and primary care visits. This sustained utilization highlights the
importance of telehealth in bridging access gaps, particularly for
vulnerable populations due to the severity and complexity of their
illnesses. The findings from ASPE highlight the critical role of
telehealth in maintaining continuity of care and suggest a pressing
need for policies that support the permanent integration of telehealth
services within the Medicare program.
AHRQ Study--The Impact of Expanded Telehealth Availability on Primary
Care Utilization
An Agency for Health Care Research and Quality (AHRQ) funded study
analyzing over 4 million primary care encounters highlights
telehealth's role in maintaining health care utilization levels without
contributing to overutilization. This study's results challenge
concerns about potential increased health care utilization due to
telehealth expansion, reinforcing telehealth's value as a viable
alternative to in-person encounters when deemed appropriate. Given
these insights, it is important for legislation like the CONNECT for
Health Act and the Telehealth Modernization Act to pass, ensuring
telehealth's role as a cornerstone of accessible, efficient health care
delivery.
Change Healthcare and Cybersecurity
The attack on Change Healthcare in February 2024 is a stark reminder of
the critical importance of cybersecurity in health care. Change
Healthcare, a division of UnitedHealth Group, was struck by a
ransomware attack that significantly disrupted the largest health care
payment and operations system in the United States. This incident led
to widespread disruptions, affecting thousands of medical practices,
hospitals, pharmacies, and others. Despite efforts to recover from this
attack, the impact on health care operations was profound, including
the disruption of claims processing, payments, and electronic
prescriptions leading to financial strain on physicians, hospitals and
pharmacies, and delays in patient care.
In fact, on March 19th, Representatives Mariannette Miller-Meeks (R-IA)
and Robin Kelly (D-IL), along with 96 bipartisan members of the House
of Representatives, sent a letter to HHS Secretary Becerra alerting the
administration of the ongoing challenges physicians and patients are
continuing to experience as part of the Change Healthcare cyberattack.
In addition to highlighting the inability of physician practices to
file claims and receive prompt payment, the letter urges CMS to clarify
why they issued such stringent repayment terms as part of their March
9th announcement permitting advance payments for Part B physicians and
other providers. The letter also highlights how individuals are being
forced to pay out-of-pocket for pharmaceuticals and health care
services due to the cyberattack, as well as pressed the Department for
answers as to how it proposes to safeguard patients from the negative
impact of their private health care information being inappropriately
disclosed to malicious actors.
Overall, the attack demonstrates the vulnerability of our health care
sector's infrastructure to cyber threats and the cascading effects
these breaches can have on patient safety, privacy, and the overall
delivery of care. The health care sector's reliance on interconnected
digital systems for patient records, billing, and payments, means that
the impact of a cyberattack can be both immediate and widespread,
affecting patient care and operational continuity.
This incident is especially concerning for rural, remote, and
underserved communities, where access to health care services is
already limited. The reliance on digital platforms for telehealth and
at-home care programs has been a lifeline for these communities,
offering a measure of parity in access to essential health care
services. However, the cybersecurity vulnerabilities exposed by the
attack on Change Healthcare reveal a potential gap in our efforts to
extend health care equity through digital means. As noted in the March
21st letter led by Vice Chairman Vern Buchanan and 19 Ways and Means
members, a 2022 AMA study found that nearly 75 percent of patients
expressed concern about protecting their personal health data.
The technical and financial burden of implementing cybersecurity should
not be placed solely on physicians or the hospitals. Congress must
provide important financial resources to assist physician practices
with the challenge of protecting health care data. Ensuring the
security of digital health care services is not merely about protecting
data but about safeguarding the continuity of care for the most
vulnerable populations in our society.
ELECTRONIC FUND TRANSFER (EFT) FEES AND REDUCING ADMINISTRATIVE
BURDENS IN HEALTH CARE
The AMA recognizes the critical need to address financial and
administrative inefficiencies that detract from our health care
system's ability to serve rural and underserved communities
effectively. A pressing issue in this context is the undue financial
strain imposed on physicians and health care providers by unnecessary
fees for Electronic Fund Transfers (EFTs).
The burden of EFT fees, as outlined in our support for S. 3805, the
``No Fees for EFTs Act'' in the Senate, and support for H.R. 6487, the
corresponding House bill, highlights a significant barrier to the
efficient operation of health care practices. These fees, which can
range from 2 percent to 5 percent of the claim payment, are levied by
some health plans and their vendors without explicit agreement from
practices, thereby exacerbating the financial and administrative
burdens on physicians. This issue is especially significant for health
care providers in rural and underserved areas, where financial
resources are already stretched thin, and administrative burdens can
significantly impact the quality and accessibility of patient care.
SUSTAINABLE PROVIDER AND FACILITY FINANCING
Need for an Inflation Based Update to Physician Payment
The physician payment system is on an unsustainable path that threatens
patients' access to physician services. This year, physicians faced yet
another round of real dollar Medicare payment cuts triggered by the
lack of any statutory update for physician services tied to inflation
in medical practice costs and flawed Medicare budget neutrality rules.
Congress acted last March to partially mitigate the 3.37 percent
reduction that was imposed in January but did not stop the cuts
completely. These cuts come on the heels of 2 decades of stagnant
payment rates. Adjusted for inflation in practice costs, Medicare
physician payment rates fell 29 percent from 2001 to 2024 because
physicians, unlike other Medicare providers, do not get an automatic
yearly inflation-based payment update.
In its 2023 annual report, the Medicare Trustees ``expect access to
Medicare-participating physicians to become a significant issue in the
long term'' unless Congress takes steps to bolster the system. The
Trustees noted, for example, that ``the law specifies the physician
payment updates for all years in the future, and these updates do not
vary based on underlying economic conditions, nor are they expected to
keep pace with the average rate of physician cost increases.''
The current Medicare physician payment system--with its lack of an
adequate annual physician payment update--is particularly destabilizing
as physicians, many of whom are small business owners, contend with a
wide range of shifting economic factors when determining their ability
to provide care to Medicare beneficiaries. Physician practices compete
against health systems and other providers for staff, equipment, and
supplies, despite their payment rates failing to keep pace with
inflation. In fact, the government's measure of inflation in
physicians' costs, the Medicare Economic Index (MEI), rose 4.6 percent
this year.
We appreciate that Congress passed legislation that, again, mitigated
severe Medicare payment cuts. However, this pattern of last-minute stop
gap measures must end. As the Committee looks to provide adequate
payments to physicians, particularly those in rural and underserved
areas, annual Medicare physician payments equal to the full MEI should
be enacted to provide an annual update that reflects practice cost
inflation. Specifically, we ask Congress to pass H.R. 2474, the
``Strengthening Medicare for Patients and Providers Act,'' which
provides a permanent annual update equal to the increase in the MEI.
Such an update would allow physicians to invest in their practices and
implement new strategies to provide high-value, patient-centered care
and enable CMS to prioritize advancing high-
quality care for Medicare beneficiaries without the constant specter of
market consolidation or inadequate access to care.
Improvements to Budget Neutrality
Another way to help ensure physicians have ample resources to provide
more care in the home is via reforms to statutory budget neutrality
requirements within the Medicare Physician Fee Schedule. The AMA urges
Congress to pass H.R. 6371, the ``Provider Reimbursement Stability
Act.'' In fact, the Energy and Commerce Committee already took action
on a portion of this legislation when it passed H.R. 6545, the
Physician Fee Schedule Update and Improvement Act, out of committee in
December 2023.
The reality is that physician payments are further eroded by frequent
and large payment redistributions caused by these budget neutrality
adjustments. CMS actuaries have on occasion overestimated the impact of
Relative Value Units (RVUs) changes in the fee schedule. When these
misestimates are not adjusted in a timely way, it results in permanent
removal of billions of dollars from the payment pool. Given the
statutory authority for budget neutrality adjustments to be made ``to
the extent the Secretary determines to be necessary,'' current law
allows CMS to account for past overestimates of spending when applying
budget neutrality. Congress should consider requiring a look-back
period (as have been implemented in other payment systems) that would
allow the Agency to correct for misestimates and adjust the conversion
factor to reflect actual claims data. In addition, the $20 million
threshold that establishes whether RVU changes trigger budget
neutrality adjustments was established in 1989--3 years before the
current physician payment system took effect. There have been no
adjustments for inflation. As a result, the amount should be increased
to $53 million to best account for past inflation.
Merit-based Incentive Payment System (MIPS)
Since the enactment of the Medicare Access and CHIP Reauthorization Act
of 2015 (MACRA), the AMA has worked closely with Congress and CMS to
promote a smooth implementation of MIPS. We supported MACRA's goals to
harmonize the separate, burdensome, and punitive Meaningful Use,
Physician Quality Payment System, and Value-Based Payment Modifier
programs. However, the implementation of a new Medicare quality and
payment program for CMS and physicians has been a significant
undertaking, which was drastically disrupted by the COVID-19 pandemic.
Further refinements are urgently needed to achieve the goals of MACRA
and reduce the administrative burden for physicians. Worse, there is a
growing body of evidence that the program is disproportionately harmful
to small, rural, safety net, and independent practices, as well as
devoid of any relationship to the quality of care provided to patients.
In particular, the 2022 Quality Payment Program Experience Report shows
that 27 percent of small practices, nearly 50 percent of solo
practitioners, and 18 percent of rural practices received a MIPS
penalty. Yet, a 2022 study found MIPS scores were inconsistently
related to performance, ``which suggests that the MIPS program is
approximately as effective as chance at identifying high vs low
performance.'' This program is driving up burden, penalizing physician
practices with fewer resources, and devoid of meaning for patients.
Last year, the AMA responded to a Congressional RFI request from the
House Committee on Ways and Means on ways to improve health care in
rural and underserved areas. In our comments, we highlight the
difficulties experienced by health care providers, particularly small,
rural, independent, and safety net practices, in adapting to the MIPS
framework, especially in the context of the disruptions caused by the
COVID-19 pandemic. We also proposed three key legislative changes aimed
at mitigating the negative impacts of MIPS penalties, improving the
timeliness and relevance of performance feedback and claims data
provided by CMS, and making the program more clinically relevant while
reducing the administrative burden on practices. We urge the Senate
Finance Committee and Congress, in general, to continue considering
these same recommendations and look forward to collaborating closely on
these critical issues to ensure that health care providers, especially
those in rural and underserved areas, are supported effectively through
the MIPS framework.
Private Equity and Health Care
The increasing presence of private equity in the health care sector
raises important considerations for the sustainability and
accessibility of health care services. With a notable shift in
physician practice ownership from independent practices to those owned
by hospitals, health systems, and private equity groups, there is an
urgent need to examine the implications of these changes, especially in
rural and underserved areas where health care options are already
limited. Rural and underserved communities stand to be significantly
impacted by the growing influence of private equity in health care.
These areas, already grappling with a shortage of health care providers
and limited access to medical services, may find themselves further
marginalized by health care consolidation and the business-driven
approaches of private equity-owned practices. The AMA's observation of
a decline in the percentage of physicians working in private practices
highlights the potential for decreased health care autonomy and
personalized patient care, aspects crucial for addressing the unique
health challenges of these rural communities. The AMA supports
legislation which creates a more equitable and transparent health care
system that prioritizes patient care over profit. H.R. 2474 is one such
proposal that seeks to ensure sustainable Medicare physician payment
rates, a crucial factor in maintaining the viability of independent
practices and, by extension, preserving access to high-quality health
care in rural and underserved areas.
HEALTH CARE WORKFORCE AND GRADUATE MEDICAL EDUCATION (GME)
Rural hospitals play a very important role within communities. For
example, in ``2020, rural hospitals supported one in every 12 rural
jobs in the U.S. as well as $220 billion in economic activity in rural
communities.'' However, between 2010 and 2021, 136 rural hospitals
closed. These closures only compound the problems experienced by the
current Health Workforce Shortage Areas (HPSAs). According to the
Health Resources and Services Administration over 19,000 providers are
currently needed just to eliminated our primary care and mental HPSAs.
Moreover, these closures have contributed to unequal access and
distribution of providers since about 20 percent of the U.S. population
lives in rural communities, but only 10 percent of physicians practice
in such areas. On top of this, with our aging physician workforce, it
is projected that there will be about a quarter fewer rural physicians
practicing by 2030.
In order to increase providers in rural areas, and to combat the
projected shortage of 86,000 physicians by 2036, more residency
positions should be created. Additionally, ``Cap-Flexibility,'' which
would allow new and current GME teaching institutions to extend their
cap-building window for up to an additional 5 years beyond the current
window (for a total of up to 10 years), would begin to help to remedy
the physician shortage we are currently experiencing. ``Giving these
[rural] hospitals more time to establish their caps will help them
start more programs and attract more residents to their communities
before the Medicare-funded resident caps are set.''
In order to encourage more individuals to become physicians and to
practice in areas that are most in need we recommend that:
Congress should act to allow the cap on GME slots to be
increased as needed to meet the nation's changing needs rather than
remain stagnant. Also, the cap building period should be increased.
The immense debt burden experienced by America's physician
workforce must be remedied and one important tool to do that is to
provide more scholarships and loan repayment programs through the
federal government. Moreover, the Teaching Health Center Graduate
Medical Education, Rural Residency Planning and Development Programs,
the National Health Service Corps, and the Indian Health Service should
have their funding increased to bolster scholarships, loan forgiveness,
and expand these programs.
Support should be provided so that more institutions are
incentivized to create rural training track programs.
Holistic changes to how physicians are recruited need to be
made. Students need to be recruited earlier in life. Additionally,
communities that need health professionals should be educated about
medical education and encouraged to help groom and assist local
students with getting into medical school. Moreover, pathway programs
and holistic outreach (mentors, interview prep, etc.) are necessary.
Medical schools and residency programs should develop educationally
sound diverse clinical preceptorships and rotations consistent with
educational and training requirements and provide early and continuing
exposure to those programs for medical students and residents. Finally,
once individuals choose residencies in rural or underserved areas,
support systems are needed.
Specific bills we support include: H.R. 2389/S. 1302 the ``Resident
Physician Shortage Reduction Act''; H.R. 4942/S. 665, the ``Conrad
State 30 and Physician Access Reauthorization Act''; H.R. 6205/S. 3211
the ``Healthcare Workforce Resilience Act''; H.R. 6980/S. 2719, the
``Directing Our Country's Transfer of Residency Slots'' or the
``DOCTORS Act''; H.R. 1202/S. 704, the ``Resident Education Deferred
Interest (REDI) Act''; H.R. 2761/S. 705, the ``Specialty Physicians
Advancing Rural Care Act'' or the ``SPARC Act''; S. 1403/H.R. 3046, the
``Medical Student Education Authorization Act''; S. 3022, the ``IHS
Workforce Parity Act''; H.R. 7050, the ``Substance Use Disorder
Workforce Act''; H.R. 7258/S. 3968, the ``Community Training,
Education, and Access for Medical Students (Community TEAMS) Act'';
H.R. 7855, the ``Rural Residency Planning and Development Act of
2024''; legislation to promote pathways to practice for the medical
profession by providing additional funding for the recruitment,
education, and training of medical students willing to work in rural
and underserved communities; and Physician Shortage GME Cap Flex
legislation.
OBSTETRICS CARE IN RURAL COMMUNITIES
Access to physician practices, clinics, and hospitals that provide
maternal and infant care services is critical to providing high-quality
care; yet, in 2023, only about 43,500 Obstetrician-Gynecologists
(OBGYNs) were in practice across the entirety of the U.S. and its
territories. In order to increase the number of maternal care providers
and help with the retention of physicians who provide maternal care
Congress should:
National Health Service Corps: Ensure that further information
about the Maternity Care Target Area (MCTA) addition to the NHSC is
provided to the public and grant more funding for the MCTA addition so
that an adequate number of maternity care physicians--including OBGYNs,
family physicians with an emphasis on maternal care, emergency medicine
physicians, and maternal-fetal medicine specialists--can be placed in
HPSAs through the NHSC.
Indian Health Service: Additional funding should be provided for
the IHS Maternal Child Health (MCH) program. The IHS MCH should ensure
that the funds it receives are used to increase access to OBGYNs and
maternal-fetal medicine specialists for AI/AN pregnant individuals; and
the Centers for Disease Control and Prevention should increase its
engagement in the following ongoing initiatives (this list is not
exhaustive): develop awards to fund support for MMRCs for AI Tribes,
expand materials on the Hear Her Campaign website for AI Tribes, and
continued support for the Healthy Native Babies Project (HNBP) to
assist local programs in addressing safe infant sleep in AI/AN
communities.
Teaching Health Center Graduate Medical Education: Increase
funding for Teaching Health Center Graduate Medical Education (THCGME)
Programs. Since 2010 this program has helped 21 OBGYNs complete their
residency and enter the workforce. Though this is an excellent start,
additional funding, and support for this program, and in particular
OGBYNs in the THCGME Program, is needed.
Residency
Additional specific training tracks for maternal and infant care should
be created and expanded. Rural track programs (RTP) already exist and
are designed to encourage the training of residents in rural areas.
Specifically, the Maternal Health and Obstetrics Pathway within the
Rural Residency Planning and Development (RRPD) Program is available
for both OBGYN rural residency programs and family medicine rural
residency programs that have enhanced obstetrical training. The RRPD is
a vital path that helps draw more physicians into rural practice.
Therefore, the AMA supports the ``Rural Residency Planning and
Development Act of 2024'' (H.R. 7855), which would codify the RRPD
program. This legislation is a great example of some of the permanent
and meaningful fixes that Congress can make to help provide additional
training pathways for physicians who want to provide much needed care
in rural communities.
While the Maternal Health and Obstetrics Pathway within the RRPD is an
important first step, it needs to be expanded so that additional
maternal health pathways can be created. For example, additional
training tracks should be created that allow for both rural and urban
training for OBGYNs, maternal-fetal medicine specialists, family
physicians, and other physicians who will likely have to provide
maternal care. These training programs could be modeled off existing
programs that are already accredited by ACGME such as the family
medicine RTP programs which exist in the ``1-2 format''--meaning the
resident's first year is at a core family medicine program and the 2nd
and 3rd years are at another site. Since there are already provisions
of law and regulations that allow urban hospitals to create multiple
RTPs and receive adjustments to their caps for newly established RTPs,
it would be possible to create an educational format that allows for
residents to train in urban and rural settings in maternal care thereby
enabling physicians who will ultimately practice in rural areas to do
rotations in hospitals with a high volume of deliveries so they can
receive ongoing training and experience with cesarean sections and
pregnancy-related complications. As such, more funding should be
provided for the Maternal Health and Obstetrics Pathway and programs
with similar goals should be created. Moreover, additional funding for
rural clinics and hospitals should be provided to enable them to offer
rotations for medical students and residents in rural obstetric care.
Monitoring of Hypertension During Pregnancy and Postpartum
Over the last decade, the AMA has developed and disseminated an
evidence-based quality improvement program, AMA MAPTM hypertension
(HTN), that has demonstrated improvement in blood pressure (BP) control
for adult patients with hypertension in primary care settings. In
addition the AMA has collaborated with other interested groups to
increase access to tools, resources and services to improve the
clinical management of hypertension, including clinical services and
home devices for self-measured blood pressure (SMBP), specifically
increasing Medicaid coverage. SMBP is an evidence-based strategy for BP
control that is incorporated into AMA MAP HTN and other AMA solutions.
Improving Care for Patients with Hypertensive Disorders of Pregnancy
HDPs are one of the leading causes of pregnancy-related deaths that
occur in the first 6 weeks postpartum. The rate of patients entering
pregnancy with chronic HTN and the overall rate of HDPs have risen
considerably in recent years. The use of SMBP has been shown to
increase compliance with American College of Obstetricians and
Gynecologists recommendations for BP monitoring, increase patient
satisfaction, and decrease readmissions for HDPs. SMBP has also shown
promise in reducing inequities in the monitoring and treatment of BP in
postpartum patients. Multiple barriers prevent the widespread adoption
and use of SMBP for which there are potential solutions. These include
coverage and access, clinical infrastructure, clinical quality
improvement, federal legislation related to remote patient monitoring,
and teleconsultation which are discussed below.
Coverage and Access
Medicaid covers 42 percent of all births in the U.S. Unfortunately,
coverage varies by state, which means that the acquisition of an extra
appropriately sized cuff, often needed to ensure clinical accuracy, is
not always covered. This variation and others are barriers to scaling
SMBP. Even when coverage exists there are still access issues. Some
states prohibit shipping a covered device directly to the patients or
require patients to go to a specific durable medical equipment supplier
rather than a more convenient location. For SMBP coverage to be
clinically impactful it necessitates that patients have coverage and
access to devices that are appropriately sized and clinically
validated. Therefore, we recommend policies that support increased
coverage and access to SMBP devices clinically validated for pregnancy
and appropriate cuff sizing options.
Clinical Infrastructure
SMBP requires investments in clinical personnel and technology
integration into clinical practice. Therefore, we recommend policies
that support: Improved interoperability of apps/platforms to support
the transfer of BP measurement data from patients to clinical teams;
and increased reimbursement for physician-led team-based care in order
to increase patient access to programs that improve care for patients
with HDP.
Clinical Quality Improvement
Clinical teams require access to data to drive and measure quality
improvement programs as well as research efforts. Dedicated funding to
scale promising interventions nationally and measure the impact on
outcomes is also needed to identify the most effective solutions and
strategies. Therefore, we recommend policies that support: Increased
availability of standardized clinical and billing data for use in
quality improvement; and increased funding for clinical, dissemination
and implementation research on HTN and cardiovascular diseases during
pregnancy and postpartum in order to identify and measure effective
interventions to improve quality of care and health outcomes.
Federal Legislation Related to Remote Patient Monitoring
It is vital to begin improving maternal and infant health outcomes for
pregnant and postpartum women with the support of telehealth and remote
patient monitoring solutions. Telehealth and technology enabled devices
have proven to be key assets in the physician's toolbox for prevention
and improved health outcomes for a number of conditions. The AMA
recognizes the same technology is critical to addressing maternal
mortality and morbidity by helping screen new mothers for high blood
pressure and related treatable and preventable conditions, such as
preeclampsia, that lead to unnecessary and avoidable maternal deaths
and adverse health outcomes.
To help improve maternal health outcomes, the AMA strongly supports S.
712, the ``Connected Maternal Online Monitoring (Connected MOM) Act.''
This bill would require CMS to send a report to Congress identifying
barriers to coverage of remote physiologic devices (e.g., pulse
oximeters, blood pressure cuffs, scales, blood glucose monitors) under
state Medicaid programs to improve maternal and child health outcomes
for pregnant and postpartum women. This bipartisan legislation would
also require CMS to update state resources, such as state Medicaid
telehealth toolkits, to align with evidence-based recommendations to
help decrease maternal mortality and morbidity.
For additional information about the AMA maternal health
recommendations please see these resources:
What Can Congress Do to Address the Severe Shortage of Minority
Health Care Professionals and the Maternal Health Crisis?
AMA Recommendations on Maternal Health.
Maternal health: Expanding on the AMA's recommendations to
reduce deaths and improve outcomes.
AMA advocacy to improve maternal health.
CONCLUSION
The AMA is committed to working with the Senate Finance Committee and
Congress to find permanent solutions that ensure that Medicare
beneficiaries have uninterrupted continued access to high quality,
affordable health care. This will require a multi-pronged approach
including continued investment and stability for access to telehealth,
addressing the lack of an inflationary update in the Medicare physician
payment system, working to eliminate administrative burdens that make
practicing medicine difficult and drive physicians out of private
practice, and policies to facilitate a larger and stronger health care
workforce. We must build on the gains achieved during the pandemic so
that all patients have access to the care they need.
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initiatives/maternal-infant-health-care-quality/index.html
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American Nurses Association
8515 Georgia Ave., Suite 400
Silver Spring, MD 20910
www.nursingworld.org
May 29, 2024
The Hon. Ron Wyden The Hon. Mike Crapo
Chairman Ranking Member
United States Senate United States Senate
Committee on Finance Committee on Finance
219 Senate Dirksen Office Building 219 Senate Dirksen Office Building
Washington, DC 20510 Washington, DC 20510
Dear Chairman Wyden and Ranking Member Crapo:
On behalf of the American Nurses Association (ANA), I would like to
thank you for this opportunity to share our input on solutions Congress
can implement to improve patients' access to healthcare in rural and
underserved communities. We appreciate the Committee's recognition of
the significant and increasingly dire challenges the nation's rural
population, workforce, and health care infrastructure are facing. We
have seen a disturbing number of facility and department closures in
rural areas. Nurses are leaving for better work environments, causing
patient access issues that will continue to worsen without meaningful
policy changes. ANA is pleased to recommend solutions that Congress can
implement to help optimize utilization of nurses and recognize their
value and contributions to our nation's health care system,
particularly in rural and underserved areas.
ANA is the premier organization representing the interests of the
nation's over 5 million registered nurses (RNs), through its
constituent and state nurses associations, organizational affiliates,
and individual members. RNs serve in multiple direct care, care
coordination, and administrative leadership roles, across the full
spectrum of health care settings. RNs provide and coordinate patient
care, educate patients and the public about various health conditions,
and provide advice and emotional support to patients and their family
members. ANA members also include those practicing in the four advanced
registered nurse (APRN) roles: nurse practitioners, clinical nurse
specialists, certified nurse-midwives, and certified registered nurse
anesthetists. ANA is dedicated to partnering with health care consumers
to improve practices, policies, delivery models, outcomes, and access
across the health care continuum.
Sustainable Provider and Facility Financing
Support RN Residency and Fellowship Programs and APRN Fellowship
Programs
ANA encourages Congress to identify ways to establish nurse residency
and fellowship programs, especially for rural and underserved
communities. During his opening statement, your witness, Jeremy P.
Davis, MHA, President and Chief Executive Officer of Grande Ronde
Hospital, chronicled the hospital's success in establishing a nurse
residency program to attract, train, and retain nurses. ANA has heard
from health systems across the country, and internationally, who have
nurse residency and fellowship programs and they share Mr. Davis's
enthusiasm for and success with these programs.
Two programs within the American Nurses Credentialing Center (ANCC), a
subsidiary of ANA, are the Practice Transition Accreditation Program
(PTAP) and the Advanced Practice Provider Fellowship
AccreditationTM (APPFA). PTAP accredits transition to
practice programs and prepares RNs for new practice roles, referred to
as residency and fellowship programs. Whereas APPFA accredits
transition to practice programs for APRNs and physician assistants/
associates (PA). ANCC is the only nurse credentialing organization to
successfully achieve ISO 9001: 2015 certification.
Nurse residency and fellowship programs bridge the gap between formal
education and practice, or transitions between nursing roles or
specialties, through hands-on mentoring and professional development.
There are programs for both RNs and APRNs.
In 2023, the RN residency and fellowship programs ANCC accredits,
included 224 programs at 774 individual sites, with 44,597
participants, and boasted more than an 83 percent retention rate over a
12-month period. The average cost per participant was $10,095 for
residency programs and $7,424 for fellowship programs. While smaller in
scale, APP fellowship programs showed similar success. In 2023, there
were 31 ANCC accredited fellowship programs for APRNs across 16 states
with 166 participants. They boasted a 92 percent completion rate at an
average cost of $20,461 per participant. Most of the funding for these
programs comes from the health systems themselves, philanthropy, and
state support. Funding from the Centers for Medicare and Medicaid
Services (CMS) and the Department of Labor does help these programs but
is by no means a large source of revenue compared to the other funding
streams. ANA strongly encourages Congress to look for ways to increase
nurse residency and fellowship programs, especially for rural and
underserved communities.
Educating Future Nurses Act (H.R. 3623/S. 1586)
Congress can also improve patients' access to healthcare in rural and
underserved communities by expanding clinical education and training
opportunities for APRNs. Medicare makes a significant investment in
Graduate Medical Education, and in FY 2020 it paid an estimated $16.2
billion.\1\ The entire federal investment in nursing education from the
federal government in FY 2024 was only $300 million, which pales in
comparison.\2\ The Educating Future Nurses Act (S. 1586/H.R. 3623)
would establish federal funding for hospitals to partner with schools
of nursing, community-based care settings, and other hospitals to
address clinical training costs for graduate nursing students. This
legislation builds upon the highly successful Graduate Nurse Education
Demonstration Program which evidence shows is a promising option for
increasing primary care providers.\3\
---------------------------------------------------------------------------
\1\ https://crsreports.congress.gov/product/pdf/IF/
IF10960#::text=Medicare%20makes%20a%
20significant%20investment,in%20FY2020%2C%20primarily%20to%20hospitals..
\2\ https://www.thenursingcommunity.org/_files/ugd/
148923_4994611787d740c9a0d9c47990
db0d61.pdf.
\3\ https://www.healthaffairs.org/doi/epdf/10.1377/
hlthaff.2021.01328.
Permanently establishing a national graduate nurse education program
that strengthens partnerships between hospitals and nursing schools,
future APRNs will be able to receive additional training and practice
options while they provide high-quality care to patients, especially in
rural and underserved communities. This is a critical part of a
comprehensive strategy to support the nursing workforce.
Expand Home Visiting Programs
Home visits by RNs can support pregnant families, promote infant and
child health, foster child development and school readiness, and help
prevent child abuse and neglect. Home visiting programs, such as the
Nurse Family Partnership (NFP), are voluntary and offer vital support
to parents as they manage the challenges of raising babies and young
children.
States are covering these evidence-based services, such as home
visiting, during the perinatal period, to improve continuity of care
for pregnant and postpartum people enrolled in Medicaid or the
Children's Health Insurance Program (CHIP). States leverage other
federal, state, local and private funding sources to finance these
services and in some cases use existing Medicaid services to cover
components of home visiting.
NFP is a national public health intervention that allows nurses to
build relationships with new mothers. NFP provides RN care in the home
during pre- and postnatal periods. The program has demonstrated
multiple positive outcomes, including reduced emergency department
visits for children and improved indicators for the health and well-
being of mothers.\4\ One example is the NFP in South Carolina, financed
jointly by the state and private funders. The partnership supports
lower income first-time mothers, and aims to reduce preterm births,
child hospitalizations, and increasing birth spacing.\5\
---------------------------------------------------------------------------
\4\ https://nap.nationalacademies.org/catalog/25982/the-future-of-
nursing-2020-2030-charting-a-path-to.
\5\ Ibid.
Home visiting models are adaptable in rural states, as well as nonrural
areas. In 2019, Kansas served an estimated 23.8 percent of children
under age three in families with incomes of less than 150 percent of
the Federal Poverty Level in the state's home visiting programs. As of
2021, families in the state have access to five out of a possible seven
evidence-based program models that have a demonstrated impact on
parenting and are designed for families with young children. In 2021,
Maryland launched a maternal and child health care transformation
initiative to fund the expansion of current maternal health-focused
programs, which includes home visiting services. In Michigan, the
statewide Maternal Infant Health Program serves over 20,000 Medicaid-
eligible families, with prenatal and postnatal home visiting covered.
Michigan is creating more awareness of their Home Visiting Program and
other state maternal health programs by developing a mobile pregnancy
app to connect users to state maternal health programs. In 2021, New
Jersey joined Oregon in enacting Universal Newborn Nurse Home Visiting
enabling all new moms, including those that experience a stillbirth and
those that adopt, to receive up to three visits by a registered nurse
in their home. Additional states with robust home visiting programs
include Iowa and Maine.\6\
---------------------------------------------------------------------------
\6\ https://www.nga.org/maternal-infant-health/.
ANA encourages the Committee to explore and consider ways it can build
on the successes of these programs as part of its efforts to increase
access to care in rural and underserved areas.
Health Care Workforce
Improving Care and Access to Nurses (ICAN) Act (S. 2418/H.R. 2713)
One of the most significant ways lawmakers can increase access to
health care services for patients in rural and underserved areas is to
remove legislative and regulatory barriers at the federal and state
levels that prevent APRNs from practicing to the top of their education
and clinical training. Supported by more than 30 years of evidence of
the safe and cost-effective provision of care by APRNs, there is a
national call to remove all barriers to full practice authority from
organizations such as the National Academies of Medicine, the National
Governors Association, the Federal Trade Commission, the Bipartisan
Policy Center, and the Veteran's Health Administration, and many
others. Here are some examples:
``Nurse Practitioners: A Solution to America's Primary Care Crisis,''
published by the American Enterprise Institute in 2018 stated that, ``A
large and growing body of research shows that the quality of care
provided by nurse practitioners is as good and, in some cases, even
better than the care provided by primary care physicians. But in many
states, nurse practitioners are held back by laws that restrict their
scope-of-practice.'' \7\
---------------------------------------------------------------------------
\7\ https://www.aei.org/research-products/report/nurse-
practitioners-a-solution-to-americas-primary-care-crisis/.
In 2019, Americans for Prosperity published, ``The Nurse Practitioner
Solution,'' stating that, ``Providing NPs full practice authority has
also helped states reduce health care costs. States that implement
these reforms spend 17 percent less per-capita on outpatient care, 11
percent less on prescription drugs, and 15 percent less on pediatric
preventive care than states that restrict access to NPs.'' \8\
---------------------------------------------------------------------------
\8\ https://americansforprosperity.org/the-nurse-practitioner-
solution/.
The Brookings Institute published, ``Improving efficiency in the
health-care system: Removing anticompetitive barriers for advanced
practice registered nurses and physician assistants,'' in 2018. The
report stated that, ``. . . the research literature is consistent in
finding no evidence of harm to patients associated with less-burdensome
SOP requirements. For example, SOP restrictiveness for NPs appears to
have no effects on a variety of outcomes, including chronic disease
management, cancer screening, and ambulatory care--sensitive hospital
admissions. Moreover, enhanced prescription authority for NPs has no
effects on infant mortality rates. In some cases, there are benefits of
less-restrictive SOP, as with infant and maternal health: independent
SOP for CNMs is associated with lower probabilities of labor induction,
fewer Caesarean deliveries (C-sections), and slight improvements in
infant health metrics such as birth weight.'' \9\
---------------------------------------------------------------------------
\9\ https://www.brookings.edu/wp-content/uploads/2018/06/
AM_PB_0620.pdf.
There are two major barriers that patients face when trying to access
care provided by APRNs: state licensure laws and the Medicare law.
Currently, there are 27 states with full practice authority (FPA) for
nurse practitioners and 23 states with FPA for CRNAs. To date, not one
of the 27 states that expanded FPA for APRNs has ever reversed course.
Time after time, APRNs demonstrate that granting FPA proves safe, cost
effective, and increases access for patients--especially those in rural
areas. Congress can use the sticks and carrots at its disposal to
---------------------------------------------------------------------------
encourage states to adopt FPA through federal health programs.
ANA highlights and urges Congress to take up and pass a bipartisan,
bicameral proposal that would remove federal practice barriers and
increase access to care in rural and underserved areas. Led by Sen.
Jeff Merkley (D-OR) and Cynthia Lummis (R-WY) in the Senate, the
Improving Care and Access to Nurses (ICAN) Act (S. 2418/H.R. 2713) is
currently endorsed by more than 240 organizations, including the
National Rural Health Association and AARP. The bill would improve
access to care for Medicare beneficiaries by removing numerous
administrative and practice barriers for APRNs. If enacted, nurse
practitioners, certified registered nurse anesthetists, certified
nurse-midwives, and clinical nurse specialists will be able to treat
Medicare beneficiaries without arbitrary and outdated hurdles that
patients in private or other insurance models do not face.
Shortages in primary care providers affect 1 in 5 Americans. Given the
shortage of primary care physicians, allowing non-physician
professionals, such as APRNs, to practice to the full extent of their
education and training gives patients more options and more types of
services. Supporting and passing the ICAN Act would meaningfully help
ensure that patients in rural and medically underserved communities
have enhanced access to care.
Improving Seniors' Timely Access to Care Act
ANA strongly supports passing the soon-to-be-reintroduced Improving
Seniors' Timely Access to Care Act, which unanimously passed the House
and was cosponsored by a majority of members in the Senate and House
last Congress. Nurses spend an inordinate amount of time on prior
authorizations to the point where it has become a subspecialty in
nursing practice. This is a waste of time, money, and resources. It is
a contributor to burnout for every heath care provider that deals with
it to get their patients the care they need--especially in commonly
understaffed rural clinics and facilities. In the future, we look
forward to working with the Committee to further reduce prior
authorization burdens in Medicare Advantage programs and elsewhere.
Innovative Models and Technology
CONNECT for Health Act (S. 2016/H.R. 4189)
ANA is a strong, long-time supporter of using technology to bring
providers and patients together. Nurses know firsthand--especially in
rural and underserved areas--that many patients choose between buying
gas and buying groceries. With the advancements made in telehealth, it
makes sense for Congress to pass legislation that fosters the use of
these technologies to better serve our patient populations. We urge
Congress to pass the CONNECT for Health Act (S. 2016/H.R. 4189) to
achieve these goals.
Over the past few years, many provisions of the CONNECT for Health Act
have either been passed into law or put into place by regulations. The
updated version of this bill will remove geographic restrictions and
expand originating sites; allow health centers and rural health clinics
to provide telehealth services; remove unnecessary in-person visit
requirements for telemental health services; and require more data to
study how telehealth is being used, impacts of quality of care, and how
it can be improved to support patients and health care providers. These
are all important steps to fully capitalize on the possibilities and
capabilities of telemedicine.
In closing, I would like to thank you for your leadership and
willingness to consider our perspective on these critical issues to
ensure that we can build a robust nursing workforce that serves
patients in rural and underserved communities across America. ANA
stands ready to work with the Senate Finance Committee to implement
policy solutions to comprehensively address the nation's health
challenges. If you have any questions, please contact Tim Nanof, Vice
President of Policy and Government Affairs, at (301) 628-5081 or
[email protected].
Sincerely,
Debbie Hatmaker, Ph.D., R.N., FAAN
Chief Nursing Officer/EVP
cc: Jennifer Mensik Kennedy, Ph.D., R.N., NEA-BC, FAAN, ANA President
Angela Beddoe, Interim Chief Executive Officer
______
American Osteopathic Association
511 2nd Street, NE
Washington, DC 20002
312-202-8000
https://osteopathic.org/
On behalf of the American Osteopathic Association (AOA) and the more
than 186,000 osteopathic physicians (DOs) and medical students we
represent, we write to thank you for the opportunity to provide a
statement for the record to the Senate Finance Committee on issues
impacting the rural health care landscape. This is a particularly
important opportunity to provide insight on matters impacting
physicians and our patients. DOs represent nearly 11% \1\ of physicians
in the United States but comprise nearly 40% of physicians serving
rural and underserved communities.\2\ In fact, many osteopathic schools
are in rural areas, allowing students to establish connections with
these communities at an early stage in their medical education.
---------------------------------------------------------------------------
\1\ American Osteopathic Association. ``2023 OMP Report.'' 2023.
https://osteopathic.org/about/aoa-statistics/
#::text=In%202023%2C%20the%20total%20number,to%20reach%20186%2C871%2
0in%202023.
\2\ Senator Martin Heinrich. ``Heinrich, Wicker, Lee Lead
Bipartisan, Bicameral Call for Increased Access to Osteopathic Medical
Research That Benefits Rural, Underserved Communities.'' 2022. https://
www.heinrich.senate.gov/newsroom/press-releases/heinrich-wicker-lee-
lead-bipartisan-bicameral-call-for-increased-access-to-osteopathic-
medical-research-that-benefits-rural-underserved-communities.
Among the core principles of osteopathic medicine are providing
patient-centered, coordinated care across the health care spectrum. We
recognize that health care stakeholders across the United States share
the responsibility of promoting reforms and policies that ensure
individuals and families have access to coverage and high-quality care
when and where they need it. Our policy proposals would provide
stability in the delivery of high-quality care in rural communities and
would provide lasting solutions to problems that have long plagued both
patients and physicians across rural America.
Serving Patients in Rural Communities:
Providing health care services in rural communities presents unique
challenges. Beyond the geographic distances rural patients must cover
in order to seek care, rural populations are older and more likely to
suffer from chronic diseases on average.\3\ Nearly 95 percent of adults
aged 60 and older have at least one chronic illness or condition, and
nearly 80 percent of the same cohort have two or more chronic
conditions.\4\ Over the next decade, the projected number of patients
with at least one chronic condition is expected to double and encompass
more than 142 million Americans by 2050, placing increasing strain on
the U.S. healthcare system and workforce.\5\
---------------------------------------------------------------------------
\3\ National Institute for Health Care Management Foundation.
``Rural Health in America: How Shifting Populations Leave People
Behind.'' October 20, 2022. https://www.nihcm.org/publications/rural-
health-in-america-how-shifting-populations-leave-people-
behind#::text=In%20rural%
20areas%2C%2018.4%25%20of,the%20health%20care%20they%20need.
\4\ National Council on Aging. Chronic Inequities: Measuring
Disease Cost Burden Among Older Adults in the U.S. A Health and
Retirement Study Analysis. Page 5, Figure 2. April 2022. Accessed
online at: https://ncoa.org/article/the-inequities-in-the-cost-of-
chronic-disease-why-it-matters-for-older-adults.
\5\ Ansah JP, Chiu CT. Projecting the chronic disease burden among
the adult population in the United States using a multi-state
population model. Front Public Health. 2023 Jan 13;10:1082183. doi:
10.3389/fpubh.2022.1082183. PMID: 36711415; PMCID: PMC9881650.
At the same time, the United States could see a shortage of as much as
124,000 physicians by 2034 if the current trends are not reversed.\6\
The physician shortage will be even more severe in rural areas, as
rural areas already comprise 60% of Health Professional Shortage Areas
(HPSAs), and projections show a shortage of 20,000 primary care
physicians in rural areas as soon as 2025.\7\, \8\
Investment in the physician workforce, especially in primary care, is
needed to build capacity across the country. To help alleviate building
pressure on the physician workforce and subsequent access impacts upon
patients, the AOA strongly urges the Committee to consider the Resident
Physician Shortage Reduction Act (S. 1302). The bill would increase the
number of residency positions funded by Medicare, with particular
emphasis on hospitals in rural areas and Health Professional Shortage
Areas (HPSAs).
---------------------------------------------------------------------------
\6\ Association of American Medical Colleges: Report Reinforces
Mounting Physician Shortage. June 11, 2021. Accessed online at: https:/
/www.aamc.org/news/press-releases/aamc-report-reinforces-mounting-
physician-shortage.
\7\ AAMC. ``Attracting the Next Generation of Physicians to Rural
Medicine.'' 2022. https://www.aamc.org/news/attracting-next-generation-
physicians-rural-medicine.
\8\ Nielsen M, D'Agostino D, Gregory P. Addressing Rural Health
Challenges Head On. Mo Med. 2017 Sep-Oct;114(5):363-366. PMID:
30228634; PMCID: PMC6140198.
Additionally, the Committee should evaluate proposals such as the
bipartisan Rural Physician Workforce Production Act (H.R. 834), which
would allow certain hospitals to receive additional payments from
Medicare for employing resident physicians in rural areas. This would
increase the number of physicians practicing in rural communities and
would provide financial support to make these residencies more
accessible.
Practice Sustainability:
Implementing policies that would reduce physician shortages in rural
areas would help to alleviate the significant burdens that rural
patients face, but does not guarantee easier or quicker access to care
for those patients. More than 100 rural hospitals have closed over the
past decade, and another 700 additional hospitals are at risk of
imminent closure. Those figures do not include the substantial impact
of small and independent physician practice closures. The GAO has found
these closures result in an average increase of 20 miles traveled each
way for patients accessing common health services, and 40 miles for
more complex services such as drug or alcohol abuse treatment.\9\
---------------------------------------------------------------------------
\9\ GAO. ``Why Health Care is Harder to Access in Rural America.''
May 16, 2023. https://www.gao.gov/blog/why-health-care-harder-access-
rural-america.
Physicians across the country, but especially those in rural areas,
face ongoing uncertainty regarding the payment they will receive for
services rendered year after year. This year, in the Medicare Physician
Fee Schedule CMS finalized a 3.37% cut to Medicare's physician
payments, which was only able to be partially mitigated by Congress.
This cut coincides with ongoing increases in costs to practice
medicine--which CMS acknowledges, as the projected increase in the
Medicare Economic Index (MEI) for 2024 will be 4.6%. Unlike nearly all
other Medicare providers and suppliers, physicians do not receive an
annual inflationary payment update. Changing this would provide
stability to independent physician practices facing unique economic
challenges in rural areas. This type of reform has previously been
proposed through the bipartisan Strengthening Medicare for Patients and
Providers Act (H.R. 2474), and the AOA strongly urges the Senate
---------------------------------------------------------------------------
Finance Committee to consider this legislation further.
The AOA also recommends further supplementing support for rural
physicians by utilizing economic levers that would make practicing in
rural and underserved communities more accessible and appealing to a
broader base of physicians. These levers include increasing Physician
Health Professional Shortage Area incentives and/or creating new means
of improving payment specifically for rural physicians. For example, in
its March 2024 report, MedPAC recommended creating an add-on payment
for physicians caring for low-income patients to better support
physicians working with rural and underserved populations.\10\ Without
predictable inflationary payment updates and additional incentives for
rural and underserved areas, the physician workforce in these
communities is likely to decline further.
---------------------------------------------------------------------------
\10\ MedPAC. ``March 2024 Report to Congress.'' April 18 2024.
Accessed online at: https://www.medpac.gov/wp-content/uploads/2024/03/
Mar24_Ch4_MedPAC_Report_To_Congress_SE
C.pdf.
Furthermore, Medicare's current budget neutrality obligations within
the physician payment schedule exacerbate the lack of inflationary
updates. A provision within the Omnibus Budget Reconciliation Act of
1989 mandated that any adjustments to the MPFS due to upward payments
or new procedures in one category that increase costs by $20 million or
more must be offset by cuts in other areas of the fee schedule. This
issue is reflected in the implementation of a new and controversial
care complexity add-on code (G2211). Improved payment for longitudinal,
coordinated primary care is necessary for physicians, but those payment
improvements should not come at the expense of payment reductions in
---------------------------------------------------------------------------
other specialties that would limit the benefits the new code provides.
Continued patient access to high quality care, particularly for chronic
conditions, is contingent upon the confluence of all three factors:
sustainable and predictable updates to physician payment under the
Medicare Physician Fee Schedule, adjustments to the budget neutrality
threshold, and investment in the physician workforce, particularly in
rural and underserved communities.
Value and Innovation:
The AOA has long advocated for expanding payment models predicated upon
delivering high quality, value-based care rather than the volume-based
nature of the current fee-for-service payment model. Despite that,
transitions to value-based payments must account for the unique needs
of different specialties, practices' current capacities, and the ways
physicians deliver care--particularly in rural areas. It also must not
create additional barriers to entry, result in reduced or inequitable
payment, or increase administrative burden. To better promote high-
value care and reduce burdens, the Committee should look at Advanced
Alternative Payment Models (APMs) rather than the Merit-Based Incentive
Payment System (MIPS) when building new policies.
Advanced APM pathways include Accountable Care Organizations (ACOs),
including those under the Medicare Shared Savings Program (MSSP), and
Centers for Medicare and Medicaid Innovation (CMMI) models. Many AAPMs
are well suited for physicians helping patients manage chronic
conditions, as they include added incentives for providers who take on
additional risk when treating patients as they deliver high quality,
coordinated, and efficient care. Ultimately, in considering any shifts
towards expanding existing APMs or seeking to accelerate physician
participation in such models, efforts must:
Support practices in making the necessary infrastructure
investments to succeed under such models;
Ensure sufficient flexibility in the range of models available
to account for differences across specialties and the ways different
physicians deliver care;
Minimize administrative burden to enable physicians who commit
to value-based models to focus on patient care; and
Ensure adequate payment for the range of services the particular
physician provides, and in the case of primary care, support the
comprehensive services that advanced primary care seeks to deliver.
Ensuring that financial support is available to incentivize this
transition is essential, and the AOA applauds Congress' extension of
AAPM bonuses for PY 2024, despite our disappointment at the reduced
bonus rate.
When Congress passed the Medicare Access and CHIP Reauthorization Act
(MACRA) it clearly intended to deliver an accelerated pathway for
physicians to participate in APMs. The transition to value-based
payment has not materialized as Congress had hoped because practices
have not been paid enough to be able to reinvest to have the capacity
to succeed in APMs. It is important to note that most APMs are built
upon the foundation of our FFS system, and continuously declining
payment rates in FFS create a vicious cycle that only makes it more
challenging to transition as revenue, and funds available to make
investments, declines.
Moreover, the current structure of MIPS does not effectively measure
performance on meaningful outcomes or accurately predict care quality,
and it is not an effective means of delivering value and penalizes
small and rural practices.
In order to ensure that rural physicians can effectively participate in
value-based care delivery models, the Committee should consider
additional funding for the Quality Payment Program's Small Practice,
Underserved, and Rural Support (QPP-SURS) program. This program ensures
small and rural physicians can participate in quality payment models
that will improve patient outcomes and access while lowering costs.
Most small and rural providers do not have access to the technical or
administrative staff necessary to ensure proper participation in the
MIPS, which currently disadvantages small and independent physician
practices. Physicians in small and rural practices consistently receive
below-average MIPS scores, demonstrating that practice size and
resources are better indicators of MIPS performance than patient
outcomes. Research shows that association with large hospital systems
and provider networks receive better MIPS performance ratings, despite
large health systems not delivering demonstrably better quality of
care.\11\ Physician-owned practices deliver high-quality, cost-
effective care regardless of health system affiliation, and this
research demonstrates the technical and administrative disadvantage
small and independent physician practices are currently facing.
Ensuring physicians at small or rural practices can participate in APMs
that incentivize high-quality, cost-effective care is integral to
improving patient access to care for chronic conditions.
---------------------------------------------------------------------------
\11\ Johnston K, Wiemken T, Hockenberry J, et al. Association of
Clinician Health System Affiliation with Outpatient Performance Ratings
in the Medicare Merit-based Incentive Payment System. JAMA Netw Open.
2020;324(10):984-992.
Value-based payment is an important tool that can be used to enhance
access to primary care, particularly for patients with chronic
conditions. The AOA applauds the Committee's interest in taking steps
to ensure physician payment reform drives patients access to high
quality, affordable, coordinated care, and we look forward to working
with the committee further.
Access Improvement Through Telehealth:
Telemedicine presents a unique opportunity to improve access for rural
patients. As practice closures increase the distance patients are
required to travel to access care, and decrease the number of available
primary care physicians and specialists, telemedicine can allow those
patients to access care from their homes. The decision to expand
telehealth flexibilities during the COVID-19 public health emergency
(PHE), and the subsequent extension of those flexibilities, has allowed
millions of Americans to access high-quality care they otherwise would
not have been able to receive. The AOA is sincerely appreciative that
the Committee and Congressional leaders have extended Medicare's
telehealth coverage flexibilities through CY 2024, and strongly
encourage the Committee to work toward a long-term reauthorization that
would provide clarity and certainty for the future of telehealth.
The expansion of telehealth coverage has allowed for patients to have
better access to the care they need when they need it and supports
physicians in building longitudinal relationships with their patients.
Congress can improve access to care by passing the Telehealth
Modernization Act and making permanent the flexibilities that were
established during the COVID-19 public health emergency and extended
via the Consolidated Appropriations Act of 2023. Some of these critical
flexibilities to expand payment for telehealth services include
allowing Medicare patients to receive telehealth services in their
home, eliminating site and geographic restrictions for non-behavioral
health services, permitting the delivery of telehealth via audio-only
technology, and allowing federally qualified health centers and rural
health clinics to serve as distant sites services other than behavioral
health services.
Ensuring appropriate coverage and payment for telehealth will enable
physician practices to leverage this modality in providing longitudinal
care and to sustain these vital services into the future. Moreover, it
will support improved access to specialists and mental health services
that are otherwise inaccessible for the vast majority of patients in
rural and underserved communities.
Conclusion
Again, thank you for the opportunity to submit comments for the record.
The Committee's work on these important issues will support the
stability of both the physician workforce and patient access to
affordable, high-quality care. The AOA and our members stand ready to
assist the Committee at large as you consider new policies and
legislation to improve patient access to care and minimize red tape for
doctors. If you have any questions or if the AOA can be a resource,
please contact AOA Vice President of Federal Affairs and Public Policy,
John-Michael Villarama, MA, at [email protected], or (202)
349-8748.
______
American Physical Therapy Association
3030 Potomac Ave., Suite 100
Alexandria, VA 22305-3085
800-999-2782
https://www.apta.org
Chairman Wyden, Ranking Member Crapo, and Members of the Senate Finance
Committee:
On behalf of our more than 100,000 member physical therapists, physical
therapist assistants, and students of physical therapy, the American
Physical Therapy Association thanks the Committee for the opportunity
to provide our perspectives and policy recommendations to improve
health care in rural communities. APTA is dedicated to building a
community that advances the physical therapy profession to improve the
health of society. As experts in rehabilitation, prehabilitation, and
habilitation, physical therapists play a unique role in society in
prevention, wellness, fitness, health promotion, and management of
disease and disability for individuals across the age span, helping
individuals improve overall health and prevent the need for avoidable
health care services. Physical therapists' roles include education,
direct intervention, research, advocacy, and collaborative
consultation. These roles are essential to the profession's vision of
transforming society by optimizing movement to improve the human
experience.
``The Economic Value of Physical Therapy in the United States,'' a
recently released APTA report, showcases the cost-effectiveness and
economic value of physical therapist services for a broad range of
common conditions. The report compares physical therapy with
alternative care across a suite of health conditions commonly seen
within the U.S. health care system. The report underscores and
reinforces the importance of including physical therapists and physical
therapist assistants as part of multidisciplinary teams focused on
improving patient outcomes and decreasing downstream costs. The
committee should consider the insights provided in this report to
support access to, coverage of, and payment for physical therapist
services, and to support policies that position physical therapists as
entry-point providers to ensure beneficiaries have timely access to
proven, cost-effective care.
Policy Recommendations
APTA appreciates the committee holding this hearing to address health
care issues in rural areas. Patients residing in rural regions often
have access to far fewer health care providers and services than those
in other areas, and they further face unnecessary delays and barriers
to critical care. To help address the current and future challenges
related to health care in rural communities, APTA endorses a series of
proposals and recommends that Congress enact the following policies:
Eliminate the Outdated Direct Supervision Requirements of PTAs Under
Medicare Part B to Provide Staffing Flexibility for
Outpatient Therapy Clinics
Patients in rural areas, particularly those on Medicare, face limited
access to a sufficient number of medical providers. In some instances,
this is due to outdated Medicare rules. Medicare allows for ``general
supervision'' of physical therapist assistants by physical therapists
in all settings--except for outpatient private practice under Part B,
which requires more stringent ``direct supervision.'' (In comparison,
occupational therapists in all settings are subject only to general
supervision of occupational therapy assistants.) While therapy
providers must comply with their state practice act if state or local
practice requirements are more stringent than Medicare's, 49 states
call for ``general supervision'' of physical therapist assistants and
occupational therapy assistants, making this outdated Medicare
regulation, which arbitrarily applies only to physical therapists in
private practice, more burdensome than most state requirements.
Standardizing the supervision requirement from direct to general for
private practices will help ensure continued patient access to needed
therapy services and give small therapy businesses more flexibility in
meeting the needs of beneficiaries.
We urge the committee to pass S. 2459/H.R. 4878--the Enabling More of
the Physical and Occupational Workforce to Engage in Rehabilitation
(EMPOWER) Act to eliminate these unnecessary barriers to therapy
providers. According to an independent report published by Dobson &
Davanzo in September 2022, this change in supervision rules is
estimated to save Medicare $271 million over 10 years.
Eliminate Duplicative and Unnecessary Administrative Burdens to
Streamline Medicare Patient Access to Care
Medicare patients in rural areas may often face delays in treatment due
to needless administrative rules, such as requirements that mandate
unnecessary plan of care certification approvals. At present, Medicare
Part B guidelines permit Medicare beneficiaries to receive therapist
evaluation and treatment services with or without a physician's order.
The physical therapist or occupational therapist may evaluate that
patient, formulate a plan of care, and commence treatment. However,
under current certification requirements, the therapy provider must
submit the plan of care to the patient's physician and have it signed
and returned within 30 days to receive payment. The clerical signature
requirement creates unnecessary paperwork and stress for therapists, as
they often struggle to track down signatures before the 30 days are up.
APTA is endorsing legislation that would provide for a new streamlined
model where in such cases that outpatient therapy services are provided
under a physician's order, the plan of care certification requirement
will be deemed satisfied if the qualified therapist simply submits the
plan of care to the patient's referring physician within 30 days of the
initial evaluation. Therapists would no longer need to obtain a signed
plan of care within 30 days from the physician who referred the
patient. The time and resources spent by therapists and physicians in
procuring a timely signature to a plan of care adds unnecessary cost,
potentially delays essential services, and fails to contribute to
improved quality of care.
We urge Congress to approve H.R. 7279--the Remove Duplicative
Unnecessary Clerical Exchanges (REDUCE) Act, to streamline the current
plan of care certification requirement under Medicare Part B to
expedite patient access to care.
Permanently Include Physical Therapists as Authorized Providers of
Telehealth in the Medicare Program
The increased use of telehealth services since the pandemic has helped
patients gain greater access to medical providers and maintain
continuity of care, leading to improved health care outcomes for
patients. The expansion of telehealth payment and practice policies
under the Section 1135 waivers during the public health emergency,
including permitting physical therapist services to be furnished via
telehealth by PTs and PTAs across settings, has demonstrated that many
health care needs can be safely and effectively met and that patients
can have improved access to skilled care by leveraging these resources.
This has been especially beneficial for patients residing in rural
areas, who often have access to far fewer providers than other regions
and may live a very considerable distance from medical facilities and
other health care professionals.
Physical therapists and physical therapist assistants use telehealth as
a supplement to in-person services to evaluate and treat a variety of
conditions prevalent in the Medicare population, including but not
limited to Alzheimer's disease, arthritis, cognitive/neurological/
vestibular disorders, multiple sclerosis, musculoskeletal conditions,
Parkinson disease, pelvic floor dysfunction, frailty, and sarcopenia.
APTA supports the ability of Medicare beneficiaries to maintain the
option, when appropriate, to have physical therapist services provided
via telehealth. Permitting services to be furnished via telehealth by
PTs and PTAs has provided greater options for patients to access care.
However, unless Congress acts, the current Medicare telehealth
flexibilities are scheduled to expire on Dec. 31, 2024.
APTA strongly urges the Committee to consider and pass S. 2880/H.R.
3875--the Expanded Telehealth Access Act, to ensure that PTs and PTAs
are permanent authorized providers of telehealth in the Medicare
program.
Facilitate the Formation of Health Care Provider State Compacts to
Increase Health Care Providers in Rural Areas
Rural areas unfortunately experience challenges in attracting the
necessary numbers of health care providers. One solution to this issue
is the use of state health care provider compacts. Professional
interstate compacts are entities consisting of state licensing bodies
that facilitate the ability of licensed professionals to provide their
services in multiple states without having to complete the time-
consuming and costly effort to become licensed in every jurisdiction.
In many professions, licensed professionals may apply to a compact
where states will recognize the professional's state credentials and
enable that professional to practice in additional states. Compacts
often result in reducing the administrative burdens on licensed
professionals while increasing services and options to consumers. Many
health care disciplines, including physical therapy, have established a
compact to allow providers--once they have been granted compact
privileges--to work in multiple states. This is especially important in
helping to address the health care provider shortage in many rural and
underserved areas.
The PT Compact allows eligible PTs and PTAs to practice in states in
addition to the ones where they are initially licensed. Member states
recognize the state licensure and credentials of a PT or PTA and allow
them to practice in other compact member states. Currently, 36 states
are members of the PT Compact and other states are considering
legislation to join.
However, PTs and other medical providers are experiencing delays and
difficulties to participate in their respective compacts due to a lack
of clarity in federal law. Before a state can become an active compact
member, it must require that all applicants for initial licensure as a
PT and PTA complete a criminal background check conducted by both state
law enforcement and the FBI, with the results of the check delivered to
the state physical therapy licensing board to be used in making a
licensure determination. Since not all physical therapy licensing
boards already have the FBI criminal background check requirement in
place, those boards are experiencing significant delays in the FBI
reviewing their application for an Originating Agency Identifier, which
is needed before the board can require FBI criminal background checks.
An ORI is a federal code assigned to an agency or person enabling the
entity to request and receive federal background check information.
In recent years, the FBI has delayed reviewing the ORI application, and
it recently has been rejecting ORI applications, even though the
statutory language is substantially similar to language adopted a few
years ago by other state boards, whose ORI applications were approved
in a timely manner by the FBI.
APTA is endorsing legislation to require the FBI to expeditiously
process ORI applications. Once the ORI application is approved, state
licensing entities would be permitted only to share with the compact
that an applicant for licensure has completed the required criminal
background check. No other information, including any findings in the
criminal background check, would be shared with the compact. This would
enable these states to become active compact members, which will
expedite the ability of PTs and PTAs to provide their services to
patients in need of physical rehabilitation in multiple states.
APTA and dozens of organizations are asking Congress to pass H.R.
1310--the States Handling Access to Reciprocity for Employment (SHARE)
Act, to ensure that required federal background checks are completed so
health care providers can participate in their respective state
compacts. This legislation will enable PTs and PTAs to obtain PT
Compact privileges, which will allow them to provide critical physical
therapy care for patients in multiple states.
Add Physical Therapists to the National Health Service Corps Loan
Repayment Program to Improve Access to Therapy
Service in Rural and Underserved Areas
The National Health Service Corps addresses the health needs of more
than 21 million underserved individuals across the nation and supports
growing our nation's health care workforce in rural and underserved
communities through the loan repayment program. The NHSC loan repayment
program, administered by the Health Resources and Services
Administration, is a federal program designed to address the nation's
dire health care workforce shortage areas by recruiting certain health
care providers to work in rural and underserved areas, known as health
professional shortage areas, or HPSAs. The program awards scholarships
and student loan repayments up to $50,000 per participant provided that
the provider agrees to work in a HPSA for at least a 2-year, full-time
commitment or a 4-year, part-time commitment. Based on data from the
Congressional Research Service, HPSAs benefit from the NHSC program
beyond the term requirements, as many providers remain in their service
area. Approximately 80% continue to practice in the HPSA for a year
after their service commitment, and about half remain in the HPSA for
10 years.
However, the NHSC Loan Repayment Program is missing a critical element
in promoting health across the continuum of care: The program does not
include a physical rehabilitation component. As experts in
rehabilitation and habilitation, PTs help individuals improve overall
health and prevent the need for avoidable and costly health care
services.
Many of the NHSC participants often work in federal community health
centers, or CHCs. However, CHCs are restricted in how physical
therapist services are delivered and reimbursed under Medicare and
Medicaid. Currently, a PT in a CHC can only perform services under the
supervision of a primary care physician and cannot independently bill
for therapy services. This restricts how CHCs may use PTs, creating a
barrier to recruiting PTs to work in CHCs. Instead, many centers must
refer patients out to receive physical therapy at another location,
which can cause delays or impediments in care for patients in rural
areas.
To address this problem, APTA urges Congress to pass H.R. 4829--the
Physical Therapist Workforce and Patient Access Act, to include PTs in
the NHSC Loan Repayment Program and provide federal community health
centers with increased flexibilities to offer physical therapist
services to their patients.
Conclusion
APTA thanks the committee for focusing attention on the importance of
improving health care in rural communities. We stand ready to work with
Congress on this issue and others affecting our nation's health care
system. Should you have any questions regarding our comments, please
contact Steve Kline with APTA Congressional Affairs at
[email protected].
Links:
https://www.valueofpt.com/
https://www.valueofpt.com/policy-and-payment/for-policymakers
https://www.dobsondavanzo.com/
index.php?src=directory&view=Publications&
category=Cost%20Estimation&srctype=Publications_lister_redesign
https://ptcompact.org/ptc-states
https://nhsc.hrsa.gov/sites/default/files/nhsc/about-us/nhsc-builds-
healthy-communities.pdf
______
American Society of Health-System Pharmacists
4500 East-West Highway, Suite 900
Bethesda, MD 20814
301-657-3000
http://www.ashp.org
May 16, 2024
The Honorable Ron Wyden
Chairman
United States Senate
Committee on Finance
219 Dirksen Senate Office Building
Washington, DC 20510-6200
The Honorable Mike Crapo
Ranking Member
United States Senate
Committee on Finance
219 Dirksen Senate Office Building
Washington, DC 20510-6200
Re: Hearing on Rural Health and Supporting Lives and Improving
Communities.
Dear Chairman Wyden and Ranking Member Crapo:
Thank you for holding this hearing on supporting lives and improving
communities through access to rural health care. The American Society
of Health-System Pharmacists (ASHP) is the largest association of
pharmacy professionals in the United States, representing 60,000
pharmacists, student pharmacists, and pharmacy technicians in all
patient care settings, including hospitals, ambulatory clinics, and
health system community pharmacies. Many of our members play a critical
role in providing pharmacy services in rural and underserved areas.
Provider Status: Pharmacists provide accessible preventive care to many
patients in rural and underserved areas. Nine in 10 Americans live
within 5 miles of a pharmacy, and patients visit their community
pharmacist twice as frequently as they visit primary care physicians.
This is particularly true for Medicare beneficiaries, who have an
average of 14 pharmacy visits per year compared to only 5 primary care
encounters. Pharmacists are a significant source of care for these
communities, by delivering preventive care, such as tests and
immunizations, flu shots, and other vaccinations to seniors that
protect them from preventable diseases and hospitalization.
To continue to protect rural and underserved seniors' access to the
pharmacists' services, we call on the Committee to approve the
Equitable Community Access to Pharmacist Services Act (``ECAPS'') (S.
2477). ECAPS will provide the necessary payment for essential
pharmacist services under Medicare Part B and ensure pharmacists can
continue to protect Medicare beneficiaries in rural and underserved
areas from the threat of COVID-19, influenza, RSV, strep throat,
pneumococcal, and hepatitis B. Without immediate Congressional action,
Medicare beneficiaries will experience difficulty obtaining essential
pharmacist services for common infectious diseases that place a
disproportionate burden on older Americans and can result in serious
hospitalization.
Virtual Supervision: Telehealth authorities have expanded access to
seniors in rural and underserved areas. One specific telehealth
flexibility that must be made permanent to enable long-term success is
allowing direct supervision of auxiliary personnel such as pharmacists
to be provided virtually. Prior to the Public Health Emergency
(``PHE''), to be reimbursed under Medicare Part B for services provided
by auxiliary personnel incident to a physician's services, a physician
was required to ``directly supervise'' such services, which required
actual physical presence by the supervising physician (42 CFR
410.32(b)(3)(ii)). During the PHE, CMS permitted direct supervision to
be effectuated through the use of audio/video real-time communication,
thus protecting the health and safety of providers as well as expand
access to services in rural and underserved areas. This has now become
the norm. Unfortunately, this flexibility is set to expire December 31,
2024. We recommend the Committee approve legislation to extend this
flexibility permanently to ensure Medicare beneficiaries continue to
have access to these services.
ASHP thanks you for holding this important hearing and considering our
recommendations. We look forward to continuing to work with you to
ensure Americans have access to the life-saving pharmacy services in
rural and underserved areas. If you have questions or if ASHP can
assist your office in any way, please contact Frank Kolb at
[email protected].
Sincerely,
Tom Kraus
______
Blue Cross Blue Shield Association
750 9th Street, NW
Washington, DC 20001-4524
202-626-4800
https://www.bcbs.com/
The Blue Cross Blue Shield Association (BCBSA) believes everyone should
have access to affordable, quality health care, no matter who you are
or where you live, and we share the Committee's ongoing commitment to
improving access to health care for all Americans. We thank the
Chairman and Ranking Member for holding this important hearing to
discuss how to improve health care access for rural communities and
drive better health outcomes.
BCBSA is a national federation of independent, community-based and
locally operated Blue Cross and Blue Shield (BCBS) companies (Plans)
that collectively cover, serve and support 1 in 3 Americans in every
ZIP code across all 50 states and Puerto Rico. BCBS Plans contract with
96% of hospitals and 95% of doctors across the country and serve those
who are covered through Medicare, Medicaid, an employer or purchase
coverage on their own. We are committed to delivering affordable and
equitable access to high-quality care for every American.
BCBSA and BCBS companies are taking strong action to meaningfully
address health disparities in rural areas. The two most impactful and
effective ways to advance care in these communities are 1) increasing
the health care workforce to better serve patients in rural
communities, and 2) leveraging existing and digital health technologies
to expand access to care.
BCBS Plans are partnering with and investing in innovative programs to
expand workforce and drive telehealth so we can expand affordable
access to quality care--no matter where the are:
BCBS Alabama recently expanded its medical scholarship program
to further address health disparities in rural and underserved areas by
increasing the number of available providers. The program has graduated
29 medical professionals who now practice in rural Alabama, with that
number bound to grow after the Plan renewed its initial $11 million
scholarship funding and committed an additional $13 million to the
program.
BCBS Montana and the Caring Foundation of Montana are partnering
with Montana State University (MSU) to help nursing students leverage
care vans that provide requisite health screenings and assessment so
that tribal communities in rural and underserved areas can meet federal
Head Start program requirements.
The BCBS Louisiana Foundation helped fund the Rapides Parish
Public Library system to deploy telehealth kiosks in branches in rural
areas of the state without existing hospitals, clinics or doctors'
offices to expand community members' access to health care services.
Regence BlueCross BlueShield has increased telehealth access
across Washington, Idaho, Oregon and Utah, expanding access to care in
largely rural areas through strategic partnerships. With Talkspace,
Regence members have access to more than 3,000 licensed mental health
professionals for 24/7 support via secure messaging and live video
sessions from the convenience of home. For members with substance use
disorders, another partnership with Boulder Care brings in-network
access to virtual addiction treatment, as well as long-term support to
address social drivers of health such as stable housing and employment.
Members are paired with a clinician, care advocate and peer coach for
wraparound care.
BCBS Plans in Illinois, Montana, New Mexico, Oklahoma and Texas
have created an innovative Population Health Analytics & Research Tool
(PopART) that generates insights into members' potential care needs.
PopART helps clinical teams identify where care is most needed by
displaying essential health and demographic features at the ZIP code-,
member- and community levels in a digestible heat map.
On a national level, we continue to improve our Blue Distinction
Centers for Maternity Care program. This is especially critical for
rural areas, which in too many communities across the country lack even
minimal access to OB/GYNs, doulas and midwives. Our Blue Distinction
Centers advance outcomes and measurement standards with the goal of
recognizing higher-quality facilities that have taken action to improve
maternal health outcomes while reducing health disparities. Starting
this year, the Blue Distinction Centers for Maternity Care met
enhanced quality measurement standards, outperforming national averages
in the following critical areas:
17% fewer cesarean births
60% fewer elective deliveries
26% fewer episiotomies
While BCBS companies are driving these innovations and effective
programs to improve access to care and reduce costs for rural
communities, more can be done. Because every community--and every
patient--deserves affordable coverage, we urge Congress to:
Enact Site-Neutral Payment and Honest Billing Reforms. BCBSA encourages
Congress to enact federal legislation to standardize payments for
identical services provided in a physician's office and at hospital
outpatient departments (HOPDs). To accomplish this, Congress should
eliminate the grandfathering provision of the Bipartisan Budget Act
(BBA) of 2015, which exempts certain HOPDs from site-neutral payments,
and pass honest billing reform. These key reforms are included in the
following bills:
S. 1869, the Site-based Invoicing and Transparency Enhancement
Act (SITE Act), introduced by Sens. Mike Braun (R-IN) and Maggie Hassan
(D-NH), which both equalizes payment for all physician office services,
regardless of ownership, and provides honest billing transparency.
Section 204 of H.R. 5378, the Lower Costs, More Transparency Act
(LCMTA), introduced by Rep. Cathy McMorris Rodgers (R-WA-5) and Frank
Pallone (D-NJ-6), which requires HOPD owned physician offices to use a
separate National Provider Identifier when billing for services
provided in a physician office to ensure appropriate reimbursement.
This bill passed the House by an overwhelming bipartisan majority in
December 2023.
An independent analysis of the grandfathering proposal estimated
federal savings of $231 billion over 10 years. The analysis also
estimated $152 billion in lower out-of-pocket costs for consumers
(about $470 per person in the U.S.) and spillover savings to private
insurance that would reduce premiums by $117 billion. Changing payment
rates in Medicare will help commercial plans negotiate more
aggressively to lower costs for patients and employers. The
Congressional Budget Office estimates Section 204 of LCMTA will reduce
premiums by $1.4 billion over the 10-year budget window.\1\ These
policies have the potential to lower out-of-pocket costs for patients
in rural areas.
---------------------------------------------------------------------------
\1\ Blue Cross Blue Shield Association. ``Affordability Solutions
for the Health of America.'' January 24, 2023, https://www.bcbs.com/
the-health-of-america/articles/affordability-solutions-white-
paper,EHP_Savings_Estimates_BCBSA_01.18.2023_Final.pdf.
Additional studies highlight the potential for significant savings and
the limited impact of existing site-neutrality policies on rural
outpatient providers. For example, a recent study by Avalere reports
that only 2.3% of hospital outpatient revenues are subject to the site-
neutral provisions of the 2015 law. An additional 10% of revenues would
be affected if the grandfathering provisions were removed.\2\ The study
also notes that rural hospitals account for a much smaller share of
Part B spending than do urban hospitals (10.8%) and that rural
hospitals make much less use of off-
campus provider-based departments (PBDs) than urban hospitals: Of all
payments made to ``. . . off-campus PBDs, rural hospitals represent
7.6% of payments to excepted off-campus PBDs [where the site-neutral
policy does not apply] and 6.2% of payments to non-excepted off-campus
PBDs.''\3\ Applying site-neutral payment policies as Congress intended
would impact rural hospitals much more modestly than urban hospitals.
We want to find a solution that protects rural providers while at the
same time helping consumers with lower costs.
---------------------------------------------------------------------------
\2\ Avalere. ``CMS Site-Neutral Payments Affect Small Share of
Spending.'' January 10, 2024, https://avalere.com/insights/cms-site-
neutral-payments-affect-small-share-of-spending.
\3\ Ibid.
BCBS Plans also see a lack of site-neutral payment in our own
commercial claims data. Two studies of outpatient services conclude
that prices for services delivered in HOPDs are significantly higher--
often five times more expensive--than when provided in an independent
physician's office.\4\ For example, one of the studies found that the
prices for a routine 20-week OBGYN diagnostic ultrasound in an HOPD are
more than 200% higher than those in the office setting. In addition, in
2022 common outpatient imaging studies, like X-rays of the foot,
shoulder, ankle, wrist, and chest were on average 250% higher at HOPDs
than those performed in an office setting.\5\ These studies also find
that HOPD prices are growing much faster than prices in other settings.
---------------------------------------------------------------------------
\4\ Blue Health Intelligence, ``Costs for Common Health Care
Procedures Significantly Higher When Performed in Hospital Outpatient
Departments,'' September 14, 2023, https://www.
bcbs.com/sites/default/files/file-attachments/site-neutral/BHISite-
Neutral-Issue-Brief.pdf; Blue Health Intelligence, ``Hospital
Outpatient Prices Far Higher, Rising Faster than Physician Sites,''
December 14, 2023, https://avalere.com/insights/cms-site-neutral-
payments-affect-small-share-of-spending.
\5\ Blue Health Intelligence, ``Costs for Common Health Care
Procedures Significantly Higher When Performed in Hospital Outpatient
Departments,'' September 14, 2023, https://www.
bcbs.com/sites/default/files/file-attachments/site-neutral/BHISite-
Neutral-Issue-Brief.pdf; Blue Health Intelligence, ``Hospital
Outpatient Prices Far Higher, Rising Faster than Physician Sites,''
December 14, 2023, https://avalere.com/insights/cms-site-neutral-
payments-affect-small-share-of-spending.
Permanently Extend and Expand Certain Telehealth Flexibilities. BCBS
companies recognize the benefit of telemedicine in expanding consumer
access to care when and where they need it. Telehealth and other
digital health tools have been critical in addressing access gaps in
communities with significant provider shortages, particularly for
behavioral health treatment. BCBSA urges continued efforts to improve
access to these services, while ensuring flexibility to address the
care needs of each community and enhancing trust and consumer
---------------------------------------------------------------------------
protections through HIPAA-aligned privacy protections.
To meet these goals, BCBSA supports actions to make pandemic-era
telehealth flexibilities permanent under Medicare as well as
legislation to increase access to mental health and substance use
disorder (MH/SUD) treatment. Specifically, BCBSA supports the passage
of:
Key sections of the CONNECT for Health Act (S. 2016), introduced
by Sens. Brian Schatz (D-HI), Roger Wicker (R-MS), John Thune (R-SD),
Mark Warner (D-VA) and Cindy Hyde-Smith (R-MS), including Sections 101
and 102, which remove geographic and originating site restrictions
under Medicare, enabling patients to access care in the comforts of
their homes regardless of their location; Sections 107 and 108, which
would repeal the 6-month in-person visit requirement prior to receiving
telemental services and waive telehealth requirements during Public
Health Emergencies; and Sections 301-303 which require quality measure
development, provide resources, guidance and training for beneficiaries
and providers.
Key sections of the Senate Finance Committee's Telemental Health
Discussion Draft, led by Sens. Ben Cardin (D-MD) and John Thune (R-SD),
including Section 1, which removes in-person visit requirements for
rural and federally qualified health centers, removes geographic site
restrictions, and provides coverage of audio-only telehealth services
when coverage of these services is ``reasonable and necessary,'' and
Section 7, which requires review and reporting on HIPAA-compliant
telemental mobile apps.
Section 107 of S. 3430, the Better Mental Health Care, Lower-
Cost Drugs and Extenders Act, introduced by Sens. Ron Wyden (D-OR) and
Mike Crapo (R-ID), which requires the Centers for Medicare & Medicaid
Services (CMS) to provide information on licensure requirements for
telehealth providers, including ways to qualify through interstate
licensing compacts.
S. 1001, the Telehealth Expansion Act, introduced by Sens. Steve
Daines (R-MT) and Catherine Cortez Masto (D-NV), which would
permanently exempt high-deductible health plans from the requirement of
a deductible for telehealth and other remote care services.
Promote Policies to Expand Maternal Health Care and Improve Outcomes.
People who live in rural communities have a higher probability of
severe maternal morbidity and maternal mortality than people who live
in urban communities, even after accounting for clinical conditions and
socioeconomic factors.\6\ BCBSA supports legislation that will expand
access to maternal care and improve maternal health outcomes for people
in rural communities, including:
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\6\ American Journal of Public Health, ``Rural-Urban Disparities in
Adverse Maternal Outcomes in the United States, 2016-2019.'' February
2023. https://ajph.aphapublications.org/doi/epdf/10.2105/
AJPH.2022.307134.
S. 948, Healthy Moms and Babies Act, introduced by Sens. Maggie
Hassan (D-NH) and Chuck Grassley (R-IA), which would coordinate
``whole-person'' care, as well as outcome-focused and community-based
prevention, would establish demo programs to expand telehealth services
for pregnant and postpartum women in Medicaid.
S. 712, the Connected MOM Act, introduced by Sens. Bill Cassidy
(R-LA) and Maggie Hassan (D-NH), which would require CMS to report and
provide resources for states for the coverage of physiologic devices
and related services under Medicare to improve maternal and child
health outcomes for pregnant and postpartum women.
Promote Workforce and Care Integration. Unfortunately, access to high-
quality health care is often impacted by shortages of appropriate
providers and support staff. Patients in rural communities feel the
consequences of these shortages every day. BCBSA supports investments
in initiatives that will expand, diversify, and better integrate the
health care workforce; expand the availability of non-physician
practitioners; and address provider burnout and promote workforce
wellness. These initiatives will improve access to care which can lead
to better health outcomes. To further these goals, BCBSA supports the
passage of:
Keys sections of the Better Mental Health Care, Lower-Cost Drugs
and Extenders Act, including Section 101, which would Expand
eligibility for incentives under the Medicare Health Professional
Shortage Area Bonus Program to practitioners furnishing mental health
and substance use disorder services; Section 104, which would promote
integrated care within Medicare; Section 110, which would provide
guidance and strategies to states on increasing their mental health and
substance use disorder care provider capacity within Medicaid; and
Section 113, which would provide guidance to states on mental health
care or substance use disorder care integration with primary care in
Medicaid and CHIP.
S. 2556, the Improving CARE for Youth Act, introduced by Sens.
Tom Carper (D-DE) and Bill Cassidy (R-LA), which would eliminate same
day billing restrictions in Medicaid, allowing for better integrated
care.
S. 1378, the COMPLETE Care Act, introduced by Sens. Catherine
Cortez Masto (D-NV) and John Cornyn (R-TX), which improves access to
mental health care for seniors on Medicare by covering certain startup
costs for local providers as they implement integrated care models.
This bill is similar to Section 104 of the Better Mental Health Care,
Lower-Cost Drugs and Extenders Act.
Conclusion
BCBSA commends the Committee for holding today's important hearing.
More action is needed to solve the problems that rural communities
uniquely face, and we look forward to working with Congress to advance
health care access, quality and affordability in rural and underserved
areas. If you have any questions or would like additional information,
please contact me or Keysha Brooks-Coley, vice president of advocacy,
at [email protected].
David Merritt
Senior Vice President, Policy & Advocacy
Links:
https://urldefense.com/v3/__https:/click.lmsbcbs.com/?qs=4515b21af15876bbfba72
339782455509135526ef2ff4b6657658012115eaaf4f4a0070e281ac3af8a79c318fdb10
d3
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iOpubuL1rvXoam5JOq5DObM0xCSAJAKhchkv4So0lF_0n-9l$
https://urldefense.com/v3/__https:/click.lmsbcbs.com/?qs=4515b21af15876bbc
e96ad28c8f42dbc57856229b01fcd5eeea3a05b764c21a74de11099129631396004e2
1076065dbe7092de98e46e1025__;!!OlwRUik!WomF-Vbj9WMo6OF8QHIexGkVP
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https://urldefense.com/v3/__https:/click.lmsbcbs.com/?qs=93109798c610f8bb6e
3958620817d7d15e606333916b38709528c0f266835040156e76dc29dd0dff9b4
cade074c8c942db6df65a5ddbe908__;!!OlwRUik!VPF6l27RTB15o3ryhfK6PE
VLBYYkk8CArD9nHf7uKkai2mI2qBwlTslhlnZZ9LlJAr4z81XJFzImVF39XRulZQ$
https://www.cbo.gov/system/files/2023-09/hr5378table.pdf
______
Center for Healthcare Quality and Payment Reform
320 Ft. Duquesne Boulevard, Suite 20-J
Pittsburgh, PA 15222
(412) 803-3650
www.CHQPR.org
Statement of Harold D. Miller, President and CEO
Chairman Wyden, Ranking Member Crapo, and distinguished members of the
Committee on Finance, thank you for the opportunity to provide input on
ways that Congress can help preserve and strengthen healthcare services
in rural areas. Over the past decade, more than 100 rural communities
across the country have lost access to essential healthcare services,
such as maternity care, inpatient care, and emergency care, and
hundreds more are at risk of losing some or all of those services over
the next several years because of the financial problems facing rural
hospitals and clinics. Current federal programs fail to address the
root causes of these problems, and in some cases they are making things
worse.
In order to prevent additional rural hospital closures and to support
high-quality healthcare services in rural areas, I urge that Congress
enact legislation that includes the following provisions:
Require that Medicare Advantage (MA) plans pay Critical Access
Hospitals and other small rural hospitals at least as much as Original
Medicare pays the hospitals for the same services, and require that the
plans pay claims from small rural hospitals in a timely fashion.
Require that MA plans contract for services with any rural
hospital or clinic that is willing to provide services to Medicare
beneficiaries enrolled in the MA plan for the same payments that the
hospital or clinic would receive if the beneficiaries were enrolled in
Original Medicare.
Require that a Qualified Health Plan sold on a health insurance
exchange must include a small rural hospital or rural health clinic in
its provider network if the hospital or clinic is willing to accept
payments for services from the insurance plan equivalent to what it
would receive for the same services from Medicare.
Require that in order to be included in the Federal Employee
Health Benefits (FEHB) Program, a health plan must include a small
rural hospital or rural health clinic in its provider network if the
hospital or clinic is willing to accept payments for services from the
insurance plan equivalent to what it would receive for the same
services from Medicare.
Require that the Centers for Medicare and Medicaid Services
(CMS) promptly approve a State Plan Amendment submitted by a state
Medicaid agency that would require Medicaid Managed Care Organizations
(MCOs) to pay small rural hospitals and clinics at least as much as
those hospitals and clinics are paid by Medicare.
These requirements would require little or no increase in federal
spending, yet they could help prevent many rural hospital closures. The
requirements for Medicare Advantage plans would simply ensure that the
large amounts of money CMS is already paying to these plans on behalf
of rural Medicare beneficiaries are used to provide adequate payments
to rural hospitals and clinics rather than to increase profits for the
health insurance companies. Similarly, the requirements for commercial
insurance policies would ensure that the premiums rural residents are
paying for these policies and the federal subsidies for those premiums
are used to pay adequately for the services those rural citizens need.
These federal requirements could encourage state insurance departments
to take similar actions.
In addition, in order to prevent additional closures of rural labor and
delivery services and to enable the delivery of high-quality maternity
care in small rural hospitals, I urge that Congress enact legislation
that includes these provisions:
Require that State Medicaid agencies and Medicaid Managed Care
Organizations pay for labor and delivery services at small rural
hospitals using a combination of Standby Capacity Payments and Delivery
Fees instead of solely with fees for services, and require that
payments for labor and delivery services are adequate to support the
minimum fixed costs of providing labor and delivery services at rural
hospitals with small numbers of births.
Require that the Federal Employee Health Benefits (FEHB) Program
provide incentives for federal employees to enroll in health insurance
plans that pay for labor and delivery services at small rural hospitals
using a combination of Standby Capacity Payments and Delivery Fees
instead of solely with fees for services.
The rationale for these recommendations is provided below.
The Crisis Facing Rural Healthcare
Almost 700 rural hospitals--over 30% of all rural hospitals in the
country--are at risk of closing in the near future, and over 300 of
these hospitals are at immediate risk of closing. Most of the at-risk
hospitals are located in isolated communities where loss of the
hospital could result in the loss of all or almost all local healthcare
services, including emergency care and primary care. Millions of people
could be directly harmed if these hospitals close, and people in all
parts of the country could be affected through the negative impacts on
workers in agriculture and other industries.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Many rural hospitals have only been able to remain open by
eliminating essential services in their communities. For example, over
the past decade, more than 200 rural hospitals have stopped delivering
babies, and fewer than half of the rural hospitals in the U.S.
currently offer labor and delivery services. Consequently, the number
of rural hospital closures does not measure the full extent of the loss
of healthcare access experienced by rural communities.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Small Rural Hospitals and Their Communities Need the Most Help
The reason that rural hospitals are being forced to eliminate services
or shut down entirely is because health insurance plans pay them less
than what it costs to deliver essential services. The hospitals'
financial losses have been growing because the cost of delivering
healthcare services has been increasing and payments from health plans
haven't kept up.
Higher costs have had a negative impact on profit margins at every
hospital in the country. But in most cases, urban hospitals and even
large rural hospitals have continued to make profits on patient
services. Their profit margins may be lower than in the past, but the
margins are still positive.
In contrast, most small rural hospitals have been losing money on
patient services for several years, including prior to the pandemic.
For them, ``lower margins'' means even bigger losses, and the bigger
the losses, the sooner the hospital will run out of money and be forced
to close. Most of the rural hospitals that are at risk of closing are
small rural hospitals, not larger rural hospitals. We define a rural
hospital as ``small'' if its annual expenses are below the median for
all rural hospitals (about $40 million in 2022).
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
There are over 1,000 small rural hospitals in the U.S.,
representing more than one-fourth of the short-term general hospitals
in the country. Small rural hospitals deliver not only traditional
hospital services such as emergency care, inpatient care, and
laboratory testing, but most of them also deliver primary care and
inpatient rehabilitation services. Most of the communities they serve
are at least a half-hour drive from the nearest alternative hospital,
and in many cases, there are no other sources of health care in their
community.
Most small rural hospitals were able to offset their financial losses
and avoid closure over the last several years because of the
significant amount of federal pandemic assistance grants they received.
However, those grants have now ended, while costs have continued to
increase, so small rural hospitals are facing bigger losses with no way
to pay for them.
Low Payments from Private Insurance Plans Are Forcing Hospitals to
Close
The primary reason hundreds of rural hospitals are at risk of closing
is that private insurance plans are paying them less than what it costs
to deliver services to patients. Although the at-risk hospitals are
losing money on uninsured patients and Medicaid patients, losses on
private insurance patients are the biggest cause of their overall
losses.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Most large rural hospitals and urban hospitals make large profits
on patients with private insurance. The exact opposite is true at most
small rural hospitals. Private insurance plans typically pay small
rural hospitals less than what they pay large hospitals and much less
than what it costs a rural hospital to deliver services in a small
rural community.
A common myth about small rural hospitals is that most of their
patients are on Medicare and Medicaid and that low payments from those
programs are causing the hospitals to lose money. The fact is, on
average, half of all of the services at small rural hospitals are
delivered to patients with private insurance. As a result, even a small
percentage loss on these patients has a big negative impact on the
hospital's overall margin.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
There are multiple ways in which private insurance companies
underpay small rural hospitals for their services:
The insurance company pays the hospital less than it pays larger
hospitals for the same service;
The insurance company fails to pay more when the cost of
delivering a service is higher in the rural area than urban areas;
The insurance company uses problematic prior authorization rules
to deny payment for a service even though the patient needed treatment
and it was covered by their insurance;
The insurance company rejects the claim submitted by the
hospital for minor technical reasons;
The insurance company delays payments by many months, forcing
the hospital to borrow money from other sources to pay its own bills;
The insurance company refuses to contract with the hospital
unless it accepts low payments, since insurance plans are not required
to contract with small rural hospitals under current network adequacy
standards.
Large hospitals can afford to hire staff and consulting firms to
negotiate with insurance companies for higher payments, to challenge
inappropriate prior authorization denials, and to resubmit rejected
claims until they are paid. Small rural hospitals do not have the
resources to do those things, so the small hospitals end up with large
financial losses for a large portion of their patients.
Medicare Advantage Plans Are a Growing Part of the Problem
Although large hospitals routinely complain that Medicare underpays
them for services, Medicare is often the best payer for small rural
hospitals. Most small rural hospitals are classified as Critical Access
Hospitals, and CMS pays them for services to Medicare beneficiaries
based on what it actually costs the hospitals to deliver those
services, rather than paying fees that were designed for larger
hospitals.
However, the requirement to pay Critical Access Hospitals based on the
actual cost of services does not apply to Medicare beneficiaries
enrolled in Medicare Advantage (MA) plans. Moreover, Medicare Advantage
plans are operated by commercial insurance companies, and they are
permitted to use all of the same problematic methods of delaying and
denying payments as other commercial insurance plans.
About half of Medicare beneficiaries nationally are now enrolled in
Medicare Advantage plans rather than Original Medicare. Although the
enrollment rate has been lower in rural areas than urban areas, it has
been increasing rapidly as a result of aggressive marketing efforts by
Medicare Advantage plans. As a result, many small rural hospitals are
experiencing greater financial losses each year as more seniors in
their community enroll in Medicare Advantage plans.
(It is important to note that Critical Access Hospitals are supposed to
be paid 101% of the actual cost of services by Medicare, but due to
Congressional sequestration requirements, they currently only receive
99% of the cost. As a result, they are being forced to lose money even
on Original Medicare patients. However, the payments from Medicare
Advantage plans are typically even less than this.)
Current Federal Programs Fail to Address the Problems
Unfortunately, none of the recent programs created by Congress or by
CMS have addressed the root causes of the problems facing rural
hospitals and clinics, and in some cases, they have made the problems
worse.
The Rural Emergency Hospital Program
Since 2023, rural hospitals with fewer than 50 beds have been allowed
to convert to ``Rural Emergency Hospital'' status if they eliminate
their inpatient services. Eliminating inpatient care means senior
citizens and other residents of the rural community have to be
transferred to a distant city if they need a short hospital stay for
treatment of a chronic disease exacerbation or a common condition like
pneumonia. Because of staff shortages in larger hospitals, there may
not be a hospital bed readily available in any nearby city, which could
result in seniors and other community residents failing to receive the
care they need in a timely fashion. Also, because the rural hospital is
also required to eliminate its swing beds if it converts to a Rural
Emergency Hospital, local residents who currently receive inpatient
rehabilitation and/or long-term nursing care in those beds can no
longer receive those services close to home.
It is a myth that rural hospitals are losing money solely or primarily
because they provide inpatient care to small numbers of patients. In
fact, in most cases, it is just the opposite--the revenues generated by
inpatient care at a small rural hospital exceed the direct costs of
delivering that care. As a result, in most cases, requiring a rural
hospital to eliminate inpatient care would reduce the hospital's
revenues more than the reduction in costs, making the hospital worse
off financially as well as reducing access to care for local residents.
The biggest causes of financial losses at most small rural hospitals
are inadequate payments from insurance companies for emergency
department visits and for primary care clinic visits. Converting to a
Rural Emergency Hospital would do nothing to ensure that Medicare
Advantage plans, commercial health plans, or Medicaid managed care
organizations pay the hospital adequately for emergency services,
primary care services, and other outpatient services. These are the
payers and services that are causing the hospital to lose money today.
Moreover, a Critical Access Hospital can only participate in the Rural
Emergency Hospital program if it gives up cost-based payment from
Medicare for outpatient services. This would reduce the hospital's
Medicare revenues on outpatient services rather than reduce the
hospital's losses from private insurance plans. Although the Rural
Emergency Hospital would receive a supplemental annual payment of about
$3 million from Medicare, that may or may not be sufficient to offset
all of the higher losses the hospital would experience due to the
change in Medicare payments. As a result, the Rural Emergency Hospital
would likely continue to experience losses in the future.
Value-Based Payments
CMS has created a variety of ``value-based payment'' programs that
claim to reward high-quality, efficient care. However, most of these
programs do not pay more or differently for the services that patients
need. They either provide shared savings bonuses if a provider manages
to reduce the total amount that Medicare spends on the provider's
patients, or, increasingly, the programs require providers to take
financial risk for total Medicare spending on their patients.
Most small rural hospitals cannot benefit from CMS ``shared savings''
programs. Most small rural hospitals do not have enough patients to
meet the minimum requirements for participation in the Medicare Shared
Savings Program, and even if they band together to do so, it is
difficult for them to qualify for shared savings bonuses because the
minimum savings threshold is so high and because rural residents are
less likely to be receiving the kinds of unnecessary services that
could be eliminated in order to save money. If a rural hospital hires
additional staff or consultants to help it succeed in the shared
savings program, it will increase its costs with no guarantee of
receiving any additional payments to offset the higher expenses. If the
hospital reduces the number of services it delivers to patients, it
will create savings for Medicare but it will also reduce its own
revenues by more than any shared savings bonus it would receive.
Both rural hospitals and residents of rural communities would be harmed
by forcing rural hospitals to take on financial risk for total
healthcare spending. ``Downside risk'' is especially problematic for
small rural hospitals, because they do not deliver and cannot control
many of the most expensive services their residents may need, and a
requirement that the rural hospital pay penalties when community
residents need expensive services at urban hospitals would worsen the
rural hospitals' financial problems. The primary goal of so-called
``population-based payment'' programs is to reduce Medicare spending,
not to preserve access to care or to improve the quality of services
for patients. The bonuses and penalties in these programs create a
financial incentive for providers to withhold services that patients
need, to discourage patients from receiving high-cost services, and to
avoid providing care to patients who have serious health problems. This
can harm rural residents rather than help them.
How to Prevent Closures of Rural Hospitals and Rural Maternity Care
Significant changes must be made in both the amounts and method of
payment for rural hospital services in order to prevent more rural
hospitals from closing in the future. Rural hospital closures threaten
the nation's food supply and energy production, because farms, ranches,
mines, drilling sites, wind farms, and solar energy facilities are
located primarily in rural areas, and they will not be able to attract
and retain workers if the workers cannot get adequate healthcare
services.
Require That Health Insurance Payments Cover the Cost of Services in
Rural Communities
Health insurance plans must pay amounts that are adequate to support
the cost of services in rural areas. Payments that are sufficient to
cover the cost of services at large hospitals will not be adequate at
small rural hospitals because it costs more to deliver healthcare
services in rural communities. This is not because rural hospitals are
inefficient, but because of the smaller number of patients served
relative to the fixed costs of the services. For example, a small rural
community will have fewer Emergency Department (ED) visits than a
larger community simply because there are fewer residents, but the
minimum cost of staffing the ED on a 24/7 basis will be the same, so
the average cost per visit will be higher.
As discussed above, the primary reason small rural hospitals and
clinics are losing money is not low payments from Medicare, but low
payments and payment denials by Medicare Advantage plans, commercial
insurance plans, and Medicaid managed care organizations. While an
increase in Medicare payments to small rural hospitals and clinics
could help reduce their losses, there is no reason why the Medicare
program should subsidize inadequate payments from private insurance
plans.
Congress can and should take action to force private insurance plans to
pay rural hospitals adequately. The specific steps it could take to do
so include:
Require that Medicare Advantage (MA) plans pay Critical Access
Hospitals and other small rural hospitals at least as much as Original
Medicare pays the hospitals for the same services, and require that the
plans pay claims from small rural hospitals in a timely fashion.
Require that MA plans contract for services with any rural
hospital or clinic that is willing to provide services to Medicare
beneficiaries enrolled in the MA plan for the same payments that the
hospital or clinic would receive if the beneficiaries were enrolled in
Original Medicare.
Require that a Qualified Health Plan sold on a health insurance
exchange must include a small rural hospital or rural health clinic in
its provider network if the hospital or clinic is willing to accept
payments for services from the insurance plan equivalent to what it
would receive for the same services from Medicare.
Require that in order to be included in the Federal Employee
Health Benefits (FEHB) Program, a health plan must include a small
rural hospital or rural health clinic in its provider network if the
hospital or clinic is willing to accept payments for services from the
insurance plan equivalent to what it would receive for the same
services from Medicare.
Require that the Centers for Medicare and Medicaid Services
(CMS) promptly approve a State Plan Amendment submitted by a state
Medicaid agency that would require Medicaid Managed Care Organizations
(MCOs) to pay small rural hospitals and clinics at least as much as
those hospitals and clinics are paid by Medicare for the same services.
As noted earlier, these requirements would require little or no
increase in federal spending, yet they could help prevent many rural
hospital closures. The requirements for Medicare Advantage plans would
simply ensure that the large amounts of money CMS is already paying to
these plans on behalf of rural Medicare beneficiaries are used to
provide adequate payments to rural hospitals and clinics rather than to
increase profits for the health insurance companies. Similarly, the
requirements for commercial insurance policies would ensure that the
premiums rural residents are paying for these policies and the federal
subsidies for those premiums are used to pay adequately for the
services those rural citizens need.
Moreover, these federal requirements could encourage state insurance
departments to take similar actions. For example, state insurance
departments could also require that insurance plans operating in the
state contract with small rural hospitals that are willing to accept
payments similar to what they receive from Medicare and to require that
the plans pay small rural hospitals in a timely manner.
It is important to understand that because the at-risk hospitals are so
small, increasing payments to levels sufficient to prevent closures
would only cost about $5 billion per year, i.e., only \1/10\ of 1% of
total national healthcare spending. Since most of the underpayment
problem is caused by private health insurance plans, most of the
increased spending would need to come from these plans, not from the
federal government. Moreover, most of the higher payments would support
primary care and emergency care, since the biggest causes of losses at
most small rural hospitals are underpayments for primary care and
emergency services. Spending would likely increase as much or more than
this if hospitals close, because reduced access to preventive care and
failure to receive prompt treatment will cause residents of the
communities to be sicker and need more services in the future.
Encourage Use of Standby Capacity Payments to Support Rural Maternity
Care Services
The ability of rural hospitals to deliver maternity care services
depends on whether payments from both Medicaid and commercial insurance
plans are adequate to cover the costs of those services. Payments per
birth that are adequate at a large hospital will be too low to support
maternity care at a small rural hospital. The reason is that the total
cost of having physicians, nurses, midwives, and anesthetists available
to deliver babies on a 24/7 basis can be the same at a small hospital
as a larger hospital, but since there are fewer births at the small
hospital, the same payment per birth would generate insufficient
revenue to cover that cost.
It is often assumed that low Medicaid payments and uninsured patients
are the reasons hospitals lose money on maternity services, but over
40% of births in rural communities are paid for by private health
plans, so inadequate payments from private payers also threaten the
viability of rural maternity care. Consequently,
States need to ensure that Medicaid payments for maternity care
services at small rural hospitals are adequate to cover the costs of
delivering those services, including payments made through Medicaid
Managed Care Organizations (MCOs); and
Employers need to ensure that the health insurance plans they
use are paying adequate amounts for maternity care services at rural
hospitals.
However, financial losses in delivering maternity care at small rural
hospitals are caused not only by the inadequate amounts paid by private
health insurance and Medicaid plans, but by the problematic method
currently used to pay for these services. A rural maternity care
hospital must be staffed and ready to deliver a baby at all times, even
though there will be no deliveries at all on many days. Currently,
however, the hospital is only paid when it actually delivers a baby. As
a result, when there are fewer pregnancies than expected, the hospital
will lose money, even if payments would have been adequate for a larger
number of births. Moreover, since payments are typically higher for
Cesarean sections, a hospital that supports natural childbirth and
reduces its C-section rate could lose money as a result.
A better approach is for private insurers and Medicaid programs to pay
hospitals for maternity care services using a combination of two
different types of payments instead of just fees for individual
services:
1. Standby Capacity Payments. If a rural hospital maintains the
round-the-clock staffing needed to deliver babies and perform C-
sections at any time, each health insurance plan should pay the
hospital a monthly or quarterly Standby Capacity Payment for each woman
of childbearing age who lives in the hospital's service area and who is
insured by that health plan. The amount of the Standby Capacity Payment
should be equal to the total amount the hospital needs to spend in
order to maintain adequate on-call staffing for labor and delivery
services, divided by the total number of insured women ages 15-44 in
the community. In aggregate, the Standby Capacity Payments from all
health plans for their members would provide the hospital with
sufficient revenue to cover the fixed costs of labor and delivery
services.
2. Delivery Fees. In addition to the Standby Capacity Payments,
the hospital should receive a Delivery Fee when it provides labor and
delivery services for an individual mother. If most or all of the
hospital's fixed costs for labor & delivery are paid for through the
Standby Capacity Payments, the Delivery Fee would only need to cover
the extra (variable) costs associated with individual births. As a
result, the Delivery Fee could be smaller than current fee-for-
service payments for labor and delivery. In addition, the Delivery Fee
should be the same amount for a vaginal delivery and a C-section, so
there is no financial penalty for the hospital or physicians if they
increase the proportion of vaginal deliveries and avoid unnecessary C-
sections.
Under this two-part payment system, both spending for the health plans
and revenue for the hospital would be far more predictable than under
the current payment system.
Alternatively, the State Medicaid agency or health insurance plan could
continue paying for individual births, and then provide an additional
payment to the hospital at the end of the year to make up any
difference between the total payments made for births during the year
and the amount the hospital would have received from a Standby Capacity
payment and smaller Delivery Fees.
Congress could help prevent additional closures of rural hospital labor
and delivery services and enable the delivery of high-quality maternity
care in rural communities by enacting legislation that would encourage
adequate payments for maternity care and the use of Standby Capacity
Payments. Legislation should include provisions that:
Require that State Medicaid agencies and Medicaid Managed Care
Organizations pay for labor and delivery services at small rural
hospitals using a combination of Standby Capacity Payments and Delivery
Fees instead of solely with fees for individual services, and require
that payments for labor and delivery services are adequate to support
the minimum fixed costs of providing labor and delivery services at
rural hospitals with small numbers of births.
Require that the Federal Employee Health Benefits (FEHB) Program
provide incentives for federal employees to enroll in health insurance
plans that pay for labor and delivery services at small rural hospitals
using a combination of Standby Capacity Payments and Delivery Fees
instead of solely with fees for individual services.
The Need for Immediate Action
Action is needed immediately to prevent more closures of rural
hospitals and rural maternity care units. Once a hospital announces it
is closing, it is likely too late to save it. Moreover, long before it
shuts down entirely, the hospital will probably be forced to eliminate
important healthcare services, such as maternity care, in an effort to
stay afloat. If a hospital continues to try and deliver maternity care
services despite large financial losses, it could result in closure of
the entire facility and the loss of all healthcare services. Loss of
local healthcare services will not only harm patients' health, it could
also cause employers to leave the community.
Failure to provide payments that will sustain small rural hospitals and
rural maternity care services would be penny-wise and pound-foolish.
Spending by health insurance plans would likely increase by a greater
amount if the hospitals close or their maternity care units close. This
is because the reduced access to preventive care and delays in
treatment resulting from a rural hospital closure will cause residents
of the community to have more serious health problems that require
expensive services in urban hospitals. Similarly, spending would likely
increase if rural maternity care units close, because mothers and
babies are more likely to experience complications if they do not have
access to local prenatal, post-partum, and delivery services. Paying
more now to preserve rural healthcare services is a better way to
invest resources and to improve the health of all citizens.
Links:
https://ruralhospitals.chqpr.org/downloads/
Rural_Hospitals_at_Risk_of_Closing.pdf
https://ruralhospitals.chqpr.org/downloads/
Rural_Maternity_Care_Crisis.pdf
https://ruralhospitals.chqpr.org/downloads/
Two_Types_of_Hospitals_in_US.pdf
______
Coalition for Rural Medicare Equality
601 New Jersey Ave., NW, Suite 620
Washington, DC 20001
The Coalition for Rural Medicare Equality (``Coalition'') thanks the
Senate Finance Committee for holding the May 16, 2024, hearing on rural
health care and the important role that rural health care plays in
supporting and improving our communities. We appreciate the opportunity
to share our perspectives on how the current way Medicare reimburses
critical access hospitals (CAHs) and rural health clinics (RHCs) ends
up inadvertently hurting rural patients and providers. The Coalition is
comprised of rural health care providers and experts in rural health
policy and operations around the country. The mission of the Coalition
is to achieve the same cost, access, and quality of health care for
rural beneficiaries that is afforded to all other classes of Medicare
beneficiaries.
CAHs and RHCs are reimbursed under a cost-based model. This is by
design to help these essential facilities continue to care for rural
communities where access to care is limited. However, because of the
way Medicare pays these facilities, beneficiaries served there end up
paying more in coinsurance. In fact, according to the Office of
Inspector General at the Department of Health and Human Services,
beneficiaries can end up paying between 2-6 times as much in
coinsurance for outpatient services at a CAH.\1\ At a Medicare Payment
Advisory Commission (MedPAC) meeting in March 2024, the Commission
staff explained that, unlike patients at other facilities, patients who
use CAHs and RHCs pay 20 percent coinsurance on charges. According to
MedPAC, because charges are, on average, 250 percent of the cost, the
cost-
sharing for a rural patient is often a full 50 percent of the full
payment to the hospital. In extreme cases, a patient can pay 100
percent of the cost.\2\ This not only unfairly penalizes many rural
patients, but it also hurts CAHs and RHCs, which see patients bypass
their facilities for hospitals that are reimbursed under a prospective
payment system. This is especially troubling considering that,
according to a report from the Center for Healthcare Quality and
Payment Reform, 150 rural hospitals closed between 2005 and 2019, and
almost 700 rural hospitals are in danger of closing.\3\ Seven hundred
rural hospitals are a full 30 percent of all rural hospitals in the
country.
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\1\ https://oig.hhs.gov/oei/reports/oei-05-12-00085.pdf.
\2\ https://www.medpac.gov/wp-content/uploads/2023/10/March-2024-
meeting-transcript.pdf.
\3\ https://chqpr.org/downloads/
Rural_Hospitals_at_Risk_of_Closing.pdf.
In addition to the unfair impact of the current reimbursement system on
coinsurance rates, the current reimbursement system limits the ways in
which CAHs and RHCs can participate in programs in which those
facilities can receive payment for reporting and improving quality of
care. This situation has resulted in increased disparity in health
outcomes between rural and urban areas. Forty years ago, age-
adjusted mortality rates in rural and urban areas were equal. By 2019,
mortality was 20 percent higher in rural areas.\4\
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\4\ https://stacks.cdc.gov/view/cdc/109049.
The Coalition believes all Medicare beneficiaries deserve access to
quality, affordable health care regardless of their ZIP code or which
kind of facility in which they receive care. We also believe in the
importance of supporting the hospitals that serve our rural
communities. As the Senate committee with jurisdiction over Medicare,
we urge members of the Senate Finance Committee to work with the
Coalition to address issues with the way CAHs and RHCs are currently
reimbursed. By doing this, we can ensure that Medicare supports care
for all beneficiaries who depend on it, both now and in the future. For
more information on the issues described in this statement, and the
Coalition's proposed solutions, we encourage you to visit
stopunfairruralcopays.org. You can also contact the Coalition by email
at Jbell@
stopunfairruralcopays.org. Thank you once again for your focus on
improving rural health care and for the opportunity to submit this
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statement.
______
Council of Academic Family Medicine
16th Street, NW, Suite 700
Washington, DC 20036
703-786-7997
Statement of Winston Liaw, M.D., MPH, Chair, Academic Family Medicine
Advocacy Committee on Behalf of the Council of Academic Family
Medicine; Chair, Department of Health Systems and Population Health
Sciences, University of Houston
The member organizations of the Council of Academic Family Medicine
(CAFM) are pleased to submit testimony to the Senate Finance Committee
hearing, ``Rural Health Care: Supporting Lives and Improving
Communities.'' CAFM collectively includes family medicine medical
school and residency faculty, community preceptors, residency program
directors, medical school department chairs, research scientists, and
others involved in family medicine education.
The geographic maldistribution of primary care physicians is a problem
in the United States, especially in rural parts of the nation. Rural
areas lack access to primary care physicians and other specialties
compared to urban and suburban areas. The COVID-19 pandemic exacerbated
the situation in rural areas, which already lacked an adequate
physician workforce and healthcare infrastructure. While 20% of the
U.S. population lives in rural communities, only an estimated 10% of
physicians practice in those communities. The distribution of
physicians is influenced by training; most physicians practice within
one hundred miles of their residency program.
Medicare accounts for two-thirds of public funding for residency
training and program requirements that influence physician workforce
distribution, making it the dominant driver of graduate medical
education (GME) policy in the United States. The last major revision to
Medicare GME policies took place over twenty years ago, in the Balanced
Budget Act of 1997 (BBA).
The Government Accountability Office (GAO) recently released a study
\1\ on physician workforce, stating that ``use of federal efforts
intended to increase GME training in rural areas was often limited and
challenging. CMS reported difficulties associated with offering GME
training in rural areas, as well as using Medicare funding to support
rural GME training.'' Recognizing the problems identified by the GAO,
the Council on Graduate Medical Education (COGME) recommends that ``CMS
and other agencies could create other incentives that permit rural
hospitals to establish fair `total resident amounts' for GME funding
and decrease the disparities between urban and rural funding.''\2\
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\1\ Government Accountability Office, Physician Workforce: Location
and Types of Graduate Training Were Largely Unchanged, and Federal
Efforts May Not Be Sufficient to Meet Needs, GAO-17-411, May 2017, at
25-26.
\2\ Council on Graduate Medical Education. Investing in a Health
Workforce that Meets Rural Needs. Feb 2021. https://www.hrsa.gov/sites/
default/files/hrsa/advisory-committees/graduate-medical-edu/
publications/cogme-rural-health-issue-brief.pdf.
Unfortunately, rural hospitals typically cannot afford to create
residency programs because they operate on narrow margins and require a
predictable funding source. Moreover, caps on the number of Medicare-
funded GME residents created by the Balanced Budget Act of 1997 have
limited the growth of GME in rural areas and have not kept pace with
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the 27% rise in residents since enactment.
For the above reasons, we support two GME-based solutions to the
shortage of rural primary care physicians. Over the past 5 years,
federal GME policy has been undermined by an erosion in definitions of
rural places.
First, we strongly support S. 230, The Rural Physician Workforce
Production Act of 2023. This bipartisan, budget-neutral bill tackles
the geographic maldistribution of physicians in rural areas stemming
from the current structure of Medicare-
funded GME. The bill's provisions would help rural teaching hospitals
through changes such as lifting the caps and removing Medicare limits
on rural resident training growth; extending equitable federal funding
to rural hospitals for residency training, such as Sole Community
Hospitals and Critical Access Hospitals; increasing support for
Medicare reimbursement of urban hospitals that send residents to train
in rural healthcare facilities; establishing an elective per resident
payment initiative to ensure rural hospitals have the resources to
bring on additional residents; and multiple definition changes to
update Medicare GME policy.
CAFM asks the Senate Finance Committee to enact one provision of S. 230
as part of any rural health package considered this year. The bill
includes a change to the definition of a rural training location. The
revised definition would consist of rural training outside of an urban
Metropolitan Statistical Area (traditional Medicare definition of
rural) or in a location with a rural-urban (RUA) code of four or higher
or in a sole community hospital or within 10 miles of one. This
definition more accurately depicts rural training and would allow more
entities to qualify for GME payments. The narrow change addresses
ongoing concerns about the current definitions of rural training
locations used under the current GME program. Eighteen months of
training in a rural location (as defined by Rural Urban Commuting Area
codes or RUCAs) more than doubles the placement of graduates in rural
community practice, and they are more likely to stay there than
residents trained in an urban location.
Second, over the past few years, Congress has authorized 1,200 new
Medicare GME slots with a formula to allocate 10 percent to rural
hospitals over 5 years. These new residency slots were historic
investments in Medicare graduate medical education and were intended to
encourage physician training in rural communities. Unfortunately, a
loophole allows non-rural hospitals to receive these slots, with only
12 allocated to truly rural hospitals. H.R. 8235, the Rural Physician
Workforce Production Act, changes the definition to truly rural and
provides a short-term fix for these hospitals for the next two years
until the program sunsets.
Both CAFM-supported solutions reflect a place-based approach to funding
graduate medical education (GME) in rural communities as a strategy to
populate and retain physicians in rural practice. Both solutions are
narrow but significant, and they start to address a comprehensive
problem. Finally, the two policies are the best immediate means to
resolve the geographic maldistribution of primary care physicians in
the United States. A key solution to this problem is increasing
physician training in rural areas. We look forward to working with you
on this critical issue.
______
Edwards Lifesciences
1 Edwards Way
Irvine, CA 92614
Edwards Lifesciences would like to thank Chairman Wyden, Ranking Member
Crapo, and Members of the Senate Finance Committee for hosting this
important hearing on the future of health care in rural communities in
the U.S. As the global leader of patient-focused innovations for
structural heart disease, Edwards is in a unique position to share
specific insights with the Committee based on our experience with
transcatheter aortic valve replacement (TAVR) and its availability in
rural communities.
In 2011, the FDA approved the Edwards SAPIEN valve as the first
transcatheter aortic valve in the United States for use in patients
with severe aortic stenosis (AS). Severe AS is a degenerative disease
associated with significant mortality and morbidity, and replacement of
the aortic valve is the only way to effectively treat the disease.
There are two ways to replace the valve: surgical aortic valve
replacement (SAVR) and TAVR. TAVR provides substantial value to our
health care system by improving the experience of receiving treatment
and population health overall by offering a minimally invasive and
life-saving treatment option to patients suffering from AS, while
simultaneously reducing health care costs.\1\ Compared with SAVR, TAVR
is associated with improved morbidity and equivalent mortality across
all levels of surgical risk. Because TAVR is less invasive than SAVR,
patient recovery is faster, hospital stays are shorter, and resource
utilization is reduced. Compared to SAVR patients, TAVR patients
experience better quality of life due to a faster, less painful
recovery process following treatment, as well as a return to normal
heart valve function that allows for a more active
lifestyle.\2\, \3\, \4\, \5\ It
should, therefore, come as no surprise that TAVR has now surpassed SAVR
to become the standard of care for the treatment of severe
AS.\6\, \7\, \8\
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\1\ Baron et al., Contemporary Costs Associated With Transcatheter
Versus Surgical AVR in Medicare Beneficiaries. Circ Cardiovasc Inter.
2022.
\2\ Leon MB, et al. Transcatheter Aortic-Valve Implantation for
Aortic Stenosis in Patients Who Cannot Undergo Surgery. N Engl J Med.
2010: 363:1597-1607.
\3\ Smith, CR. Transcatheter Versus Surgical Aortic-Valve
Replacement in High Risk Patients. N Engl J Med. 2011; 364:2187-2198.
\4\ Leon MB, et al. Transcatheter or Surgical Aortic-Valve
Replacement in Intermediate-Risk Patients. N Engl J Med. 2016;374:1609-
1620.
\5\ Mack, MJ, et al. Transcatheter Aortic-Valve Replacement with a
Balloon Expandable Valve in Low-Risk Patients. N Engl J Med. 2019;
380:1695-1705.
\6\ Carroll, JD, et al. STS-ACC TVT Registry of Transcatheter
Aortic Valve Replacement. J Am Coll Cardiol. 2020 Nov, 76 (21) 2492-
2516.
\7\ Nkomo VT, et al. Burden of valvular heart diseases: a
population-based study. Lancet. 2006;368(9540):1005-1011.
\8\ U.S. Food and Drug Administration. FDA approves first
artificial aortic heart valve placed without open-heart surgery [press
release]. http://www.fda.gov/NewsEvents/Newsroom/PressAnnouncements/
ucm278348.htm. Published November 2, 2011. Accessed November 3, 2011.
We believe the TAVR approval and coverage experience overall is a
success story, highlighting the importance of FDA, CMS, and stakeholder
collaboration. This partnership generated meaningful evidence that
ultimately helped to support the continuous innovation and advancement
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in TAVR technology and expanded access to more patients.
Even with all the advancements, considerable disparities in patient
access to TAVR remains--particularly in rural areas and other
underrepresented communities where hospitals do not have the resources
nor patient volumes to meet the site and operator requirements included
in the CMS coverage requirements.
When TAVR was first approved in 2011, Edwards worked with FDA, CMS, the
medical and patient communities, and industry to manage the
introduction of this technology to the U.S. market and ensure that it
was being used responsibly and safely. CMS crafted a TAVR National
Coverage Determination (NCD) that recognized the need for a heart team
to evaluate and treat TAVR patients, and invoked coverage with evidence
development (CED) to allow us to work with providers to collect
necessary data aligned with the FDA post-market requirements. These
efforts have enabled us to track inequities associated with site
eligibility requirements contained within the TAVR NCD \9\,
\10\, \11\, \12\, \13\ As one such
example, our insights collected as part of CED revealed that
implementing temporary flexibilities to hospital and provider
requirements in response to the COVID public health emergency (PHE) did
not compromise patient care.\14\
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\9\ Marquis-Gravel, G, et al. Geographic Access to Transcatheter
Aortic Valve Replacement Centers in the United States: Insights From
the Society of Thoracic Surgeons/American College of Cardiology
Transcatheter Valve Therapy Registry. JAMA Cardiol. 2020; 5(9): 1006-
1010.
\10\ Nathan, AS, et al. Socioeconomic and Geographic
Characteristics of Hospitals Establishing Transcatheter Aortic Valve
Replacement Programs, 2012-2018. Circ Cardiovasc Qual Outcomes. 2021;
14(11): e008260.
\11\ Nathan, AS, et al. Racial, Ethnic, and Socioeconomic
Disparities in Access to Transcatheter Aortic Valve Replacement Within
Major Metropolitan Areas. JAMA Cardiol. 2022 7(2): 150-157.
\12\ Alkhouli, M, et al. Racial Disparities in the Utilization and
Outcomes of TAVR: TVT Registry Report. JACC Cardiovasc Interv .
2019;12(10): 936-948.
\13\ Brennan JM, et al., Racial Differences in the Use of Aortic
Valve Replacement for Treatment of Symptomatic Severe Aortic Valve
Stenosis in the Transcatheter Aortic Valve Replacement Era. J Am Heart
Assoc. 2020. 9 (16): e015879.
\14\ Spoon, D, et al. ``Transcatheter Aortic Valve Replacement
(TAVR) Outcomes during the Public Health Emergency (PHE) Flexibility
Period.'' Accepted for publication in Mayo Clinic Proceedings. May
2025.
Using these same data, researchers have now evaluated TAVR outcomes
during the PHE9 and compared them to outcomes before the flexibilities
were allowed. These studies demonstrate there were no changes in TAVR
outcomes when programs could operate within the pandemic-era NCD
requirements. TAVR outcomes remained excellent during this time,
demonstrating that hospitals and heart teams can be entrusted with
these flexibilities without compromising patient outcomes. This de-
facto case study demonstrates that TAVR is a mature therapy and that
the COVID-19 flexibilities that impact the provision of TAVR must be
made permanent. The policies that we believe should be extended
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include:
Flexibilities related to face-to-face encounters and provider
specialty allow flexible staffing models to ensure access to life-
saving treatments as ongoing staffing challenges persist. In addition
to a nation-wide nursing shortage, provider burnout, and continued
hospital resource constraints, access to TAVR will continue to be
challenged by a growing shortage of 2,000 cardiovascular surgeons by
2030 due to retirement and few entrants to the physician specialty.\15\
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\15\ Williams, TE, et al. (2010). A formidable task: Population
analysis predicts a deficit of 2,000 cardiothoracic surgeons by 2030.
The Journal of thoracic and cardiovascular surgery, 139(4), 835-841.
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The waiver of facility and provider volume requirements. This
flexibility provides Medicare coverage and economic resources to
programs in low population density areas, preventing the loss of local,
community programs in areas where patients may otherwise delay care due
to travel burden. It is estimated that 13.7 million beneficiaries over
age 65, including 2.2 million minorities and 500,000 with low-income,
live in communities that do not have access to TAVR.\16\
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\16\ 2020 ACS 5 year data; table S0103, non-white population data.
Hospitals within 20 miles of ZIP code.
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Expansion of telehealth authorities. Telehealth has been
critical to patient access during the PHE and provides an alternative
option for patient assessment to address disparities in care that were
further exacerbated for TAVR patients by the COVID-19 pandemic. Access
trends among Medicare patients receiving TAVR reveal Hispanic (46%),
Asian (38%), and Black (21%) patients more frequently leverage
telehealth as an alternative to an in-person pre-TAVR eligibility
screening versus White (20%) patients.\17\ Notably, there is bipartisan
support in Congress for extending this flexibility.
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\17\ Medicare 5% File, TAVR CY2020.
These changes were reflected in the following regulations during the
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PHE:
Interim Final Rule CMS-1744-IFC:
Waiver of Face-to-Face or In-Person
Requirement: NCD face-to-face requirement for evaluations will
not apply during the PHE.
Waiver of Physician Specialty Requirement: The
chief medical officer for a facility may authorize another
physician specialty to meet physician specialty requirements
specified in an NCD during the PHE.
Interim Final Rule CMS-3401-IFC:
Waiver of NCD Procedural Volumes: Procedure
volume requirements specified in the NCD for facilities and
practitioners will not be enforced during the PHE.
The excellent TAVR-related outcomes have continued and provide evidence
that TAVR cases can be conducted under flexible NCD criteria without
sacrificing quality of care. No significant difference in all-cause
mortality, stroke, valve-related complications, quality of life or
readmissions has been observed between pre- and post-PHE registry data
for TAVR.\9\,\18\ Reinstating these restrictions now that the PHE has
been declared over adds unnecessary limitations on patient access at
rural and community hospitals. Further, making these flexibilities
permanent could be of particular benefit to rural hospitals, allowing
them to serve more patients rather than sending them to centralized
surgical centers. Scarcity of resources creates barriers to access, and
rural areas are often some of the most under-resourced. It is critical
to eliminate any unnecessary burdens on patients, including through
robust fit-for-purpose evidence development. Improving patients' access
to TAVR within local communities is important because it can prevent
life-threatening delays in treatment and enhance health care efficiency
through a less-invasive alternative to SAVR.\19\, \20\
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\18\ TVT Registry, TAVR 2020.
\19\ Malaisrie, S, et al. Mortality while waiting for Aortic Valve
Replacement. Ann Thorac Surg. 2014; 98:1564-71.
\20\ Damluji, A, et al. Transcatheter Aortic Valve Replacement in
Low-Population Density Areas: Assessing Healthcare Access for Older
Adults With Severe Aortic Stenosis. Circ Cardiovasc Qual Outcomes.
2020;13(8): e006245.
Challenges presented by the COVID-19 pandemic led to significant re-
evaluation of many long-standing health policies. In support of rural
hospitals and rural communities, Congress can use this unique
opportunity to examine the impact of specific policies on patient
access and value in the delivery of care. At Edwards, we remain
committed to ensuring that all patients have equitable access to life-
saving innovations. TAVR stands as a powerful example of the importance
of ongoing, real-world data collection and the efficiencies in the
regulatory process that can be gained when we all work together to
measure performance and outcomes in new patient populations. We look
forward to working with the members of this Committee to help address
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system-wide disparities in access to high quality care.
Thank you for the opportunity to provide these comments. Should you
have any questions, please contact Edwards Senior Vice President of
Government Affairs, Leah Kegler at [email protected] or 703-855-
0737.
______
Federation of American Hospitals
750 9th Street, NW, Suite 600
Washington, DC 20001
202-624-1500
FAX 202-737-6462
https://www.fah.org/
The Federation of American Hospitals (FAH) submits the following
statement for the record in advance of the Senate Finance Committee
hearing entitled ``Rural Health Care: Supporting Lives and Improving
Communities.'' We appreciate the Committee's efforts to better
understand the health needs of rural Americans, and we look forward to
continuing to work with Congress on these critical issues.
The FAH is the national representative of more than 1,000 leading tax-
paying hospitals and health systems throughout the United States. FAH
members provide patients and communities with access to high-quality,
affordable care in both urban and rural areas across 46 states, plus
Washington, DC, and Puerto Rico. Our members include teaching, acute,
inpatient rehabilitation, behavioral health, and long-term care
hospitals and provide a wide range of inpatient, ambulatory, post-
acute, emergency, children's, and cancer services. Tax-paying hospitals
account for approximately 20 percent of community hospitals nationally.
Every day across our nation, millions of Americans in small communities
depend on rural hospitals for vital and lifesaving care. Rural
hospitals operate 24/7 and are pillars of the communities they serve.
Many operate on thin margins and struggle to keep their doors open,
with low patient volumes and a patient mix that is generally older and
from lower-income backgrounds, relying heavily on Medicare and
Medicaid. This unique patient demographic in rural regions often lends
to a dichotomy: a high volume of Medicare-dependent patients, but a
lower volume of total patients overall.
Today's hearing reflects the Committee's recognition of these
challenges, and we look forward to continuing to work together to
improve access to health care services in rural communities. FAH is
committed to improving the health of rural Americans nationwide. To
that end, we offer the following recommendations in the areas of
telehealth, financial sustainability, workforce, and Medicare
Advantage.
Telehealth
Since the COVID-19 pandemic, the increase in health care services
provided via telehealth has promoted timely access to patient-centered
care, enhanced patient choice and, most importantly, improved access to
care in rural areas. Today, many patients travel over an hour for a
routine doctor's appointment, and often much further to seek specialty
care. Telehealth eliminates this geographic barrier and greatly lowers
the hurdle for accessing quality care, enabling hospitals to meet
patients literally where they are. In rural areas where it is difficult
to recruit physicians and other highly trained staff, telehealth and
other remote technologies can also help make up for staffing shortfalls
or staff burnout. With telehealth flexibilities set to expire at the
end of 2024, we urge lawmakers to build on this progress and make
permanent pandemic-era Medicare telehealth provisions to ensure rural
Americans have access to the care they need to improve their health.
Financial Sustainability
Rural hospitals play a pivotal role in providing access to care for
over 60 million Americans in underserved communities. Providing
stability to rural hospitals is critical to addressing the health needs
to rural Americans. The MDH and LVH adjustment payment programs were
created to ensure that qualifying rural hospitals can continue to
provide much needed services in their communities by better reflecting
the actual costs of providing care in rural areas, where patients are
more likely to be older, lower income and sicker than those in urban
areas. We urge lawmakers to make these important programs permanent to
provide the financial stability, security, and certainty needed to help
prevent closures and disruptions to care in rural communities.
Providing care in rural communities is a difficult endeavor as rural
hospitals operate on thin margins with delicate payment hydraulics and
a fragile patient mix. Thus, the FAH strongly opposes any policies that
threaten access to health care, including so-called ``site-neutral''
payment policies that would decrease Medicare payments to hospitals.
These payment cuts do not take into account the fact that hospitals are
already only paid 82 cents on the dollar by Medicare and hospitals
require more funding than other sites of care because they treat
sicker, lower-income patients with more complex and chronic conditions,
provide 24/7 access to care in the community, and are held to a higher
regulatory and safety standard. Additionally, these cuts
disproportionately impact patients in rural and underserved communities
where hospitals are already at risk of closing or reducing service
lines such as emergency rooms and maternity care. If site-neutral
payment cuts were to be enacted, rural hospitals would particularly be
impacted by the financial strain, forcing difficult decisions regarding
the viability of operations in rural areas.
Workforce
Perhaps the greatest challenge facing hospitals today is maintaining an
adequate workforce. Hospitals in rural and underserved communities are
experiencing a combination of provider burnout, physician and staffing
shortages, and difficulty attracting workers to these areas. These
factors cause significant strain on hospital operations and have a
direct effect on their ability to meet the needs of the patients and
communities in which they serve.
Hospitals are also investing heavily in both training and patient care
management innovation to improve the bandwidth of registered nurses and
reduce nurse workload burden. Allowing nurses to reduce paperwork and
non-clinical responsibilities through technology and process
enhancements would have the added benefit of reducing burnout.
Medicare Advantage
According to the Chartis Center for Rural Health, the growth of
Medicare Advantage (MA) in rural areas could further worsen the
financial stability of rural hospitals nationwide as many rural
providers may not be able to effectively navigate MA's administrative
requirements for payment, such as prior authorizations, which leads to
increased denials.\1\ A 2022 U.S. Department of Health and Human
Services (HHS) Office of the Inspector General (OIG) report found that
MA plans systemically apply problematic operating policies, procedures
and protocols that limit care for MA enrollees. The OIG Report also
identified patterns by which MA plans apply utilization controls to
improperly withhold coverage or care from MA enrollees, including:
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\1\ ``Unrelenting Pressure Pushes Rural Safety Net Crisis Into
Uncharted Territory'' (Feb 2024), https://www.chartis.com/sites/
default/files/documents/chartis_rural_study_pressure_pushes_
rural_safety_net_crisis_into_uncharted_territory_feb_15_2024_fnl.pdf.
Improper prior authorization denials. OIG found that 13 percent
of prior authorization requests denied by MA plans would have been
approved for beneficiaries under original Medicare.
Improper denials for lack of documentation. OIG found that in
many cases beneficiary medical records were sufficient to support the
medical necessity of the services provided.
Improper payment request denials. The OIG found that 18% of
payment requests denied by MA plans actually met Medicare coverage
rules and MA plan billing rules.\2\
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\2\ ``Some Medicare Advantage Organization Denials of Prior
Authorization Requests Raise Concerns About Beneficiary Access to
Medically Necessary Care'' (April 2022), https://oig.hhs.gov/oei/
reports/OEI-09-18-00260.pdf.
These OIG findings reflect a broader pattern of MA plan practices that
inappropriately deny, limit, modify, or delay the delivery of or access
to services and care for MA beneficiaries. While these practices are
harmful to hospitals nationwide, they are especially harmful to rural
hospitals, many of whom are already facing tight margins. We urge
lawmakers to rein in MA prior authorization and other abuses to ensure
that rural hospitals can continue to provide 24/7 access to care in the
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community.
We look forward to working with the Committee on these critical issues
impacting rural health. If you have any questions or want to discuss
these comments further, please contact Charlene MacDonald at (202) 615-
0599.
______
Medical Group Management Association
1717 Pennsylvania Ave., NW, #600
Washington, DC 20006
T 202-293-3450
F 202-293-2787
https://www.mgma.com/
The Honorable Ron Wyden The Honorable Mike Crapo
Chairman Ranking Member
U.S. Senate U.S. Senate
Committee on Finance Committee on Finance
215 Dirksen Senate Office Building 215 Dirksen Senate Office Building
Washington, DC 20510 Washington, DC 20510
Re: MGMA Statement for the Record--Senate Committee on Finance Hearing,
``Rural Health Care: Supporting Lives and Improving Communities''
Dear Chairman Wyden and Ranking Member Crapo:
On behalf of our member medical group practices, the Medical Group
Management Association (MGMA) would like to thank the Committee for
holding this important hearing on supporting and improving rural
healthcare. We appreciate the Committee examining the multifaceted
issues facing medical groups in these regions; patient access to care
is paramount, and we hope our response today will assist the Committee
in enacting legislation to address the current challenges facing
practices in rural areas.
With a membership of more than 60,000 medical practice administrators,
executives, and leaders, MGMA represents more than 15,000 medical group
practices ranging from small private medical practices to large
national health systems representing more than 350,000 physicians.
MGMA's diverse membership uniquely situates us to offer the following
policy recommendations.
Rural practices face a multitude of challenges in maintaining their
ability to operate and provide high-quality care. More than 15% of all
Americans live in rural areas, and patients in these areas generally
tend to be older and sicker than patients in urban centers.\1\ The
reality of operating a rural practice, coupled with inflation, staffing
shortages, and Medicare physician payment cuts, coalesce to make it
difficult for these practices to thrive. Federal policy should support
and promote the success of these vital medical groups.
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\1\ Centers for Disease Control and Prevention, About Rural Health,
Nov. 28, 2023.
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Key Recommendations
Provide an annual inflation-based physician payment update based
on the Medicare Economic Index (MEI) and modernize the budget
neutrality aspect of Medicare payment. Congress should pass the
Strengthening Medicare for Patients and Providers Act of 2023, which
would provide a long-needed annual Medicare physician payment update
tied to inflation, as measured by the MEI. Congress needs to also
mitigate the negative impact of the antiquated budget neutrality
requirements of the Medicare Physician Fee Schedule (PFS) by enacting
the Provider Reimbursement Stability Act of 2023.
Make commonsense changes to the Merit-based Incentive Payment
System (MIPS) such as alleviating the reporting burden, and extending
the Small, Underserved, and Rural Support (SURS) program that expired
in 2022.
Work to address the physician shortage by properly funding
Graduate Medical Education (GME) programs and increasing Medicare-
supported medical residency positions.
Implement prior authorization reform. Prior authorization burden
is particularly felt by rural practices and contributes to staff
burnout. Congress should enact an updated version of the Improving
Seniors' Timely Access to Care Act to alleviate what has historically
been the number one regulatory burden facing medical groups. The GOLD
CARD Act and the Reducing Medically Unnecessary Delays in Care Act
would make additional needed reforms to the prior authorization process
if passed into law.
Permanently institute many of the telehealth flexibilities
currently in place.
Provide positive financial incentives to support rural practices
transitioning into value-based care. Congress should extend the
Alternative Payment Model (APM) incentive bonus at 5%, provide
resources to assist practices with the transition into APMs, and allow
the Centers for Medicare & Medicaid Services (CMS) the ability to set
the qualifying participant threshold at an appropriate level that does
not discourage APM participation. Numerous provisions in the Value in
Health Care Act of 2023 would help address these concerns.
Support the development of physician-led, value-based care
models designed to succeed in rural and underserved communities.
Medicare Reimbursement
While rural practices face unique challenges compared to their urban
counterparts, these issues are exacerbated by the dire Medicare
physician reimbursement outlook medical groups face throughout the
nation. Under the Medicare Access and CHIP Reauthorization Act of 2015
(MACRA), Congress repealed the flawed Sustainable Growth Rate (SGR) and
reformed Medicare's approach to physician payment. While well
intentioned, physician payments have not kept up with inflation or the
cost of running a medical practice under MACRA's revised methodology
for updating the Medicare PFS.
In addition to no annual positive payment update, medical groups also
experience annual reimbursement cuts stemming from 2021 PFS changes and
correlating budget neutrality requirements. CMS finalized a 3.37% cut
to the Medicare conversion factor in its 2024 Medicare PFS; from
January 1st to March 8th of this year, medical groups absorbed a 3.37%
reduction to reimbursement. Following congressional action to partially
mitigate 1.68% of the cut in the Consolidated Appropriations Act of
2024 (CAA, 2024), physician practices are left with a 1.69% reduction
for the rest of the year. These ongoing cuts are untenable for
practices and must be averted to ensure the financial viability of
medical groups.
The 2024 Medicare Board of Trustees' annual report outlines the
inadequacy of Medicare payment and its potential impact on Medicare
participation: ``While the physician payment system put in place by
MACRA avoided the significant short-range physician payment issues
resulting from the SGR system approach, it nevertheless raises
important long-range concerns that will almost certainly need to be
addressed by future legislation. . . . Absent a change in the delivery
system or level of update by subsequent legislation, the Trustees
expect access to Medicare-participating physicians to become a
significant issue in the long term.''\2\ This echoes what medical
groups are saying, with 87% of groups reporting reimbursement not
keeping up with inflation impacts current and future Medicare patient
access.\3\
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\2\ 2024 Medicare Board of Trustees Annual Report, https://
www.cms.gov/oact/tr/2024, May 6, 2024.
\3\ MGMA, 2023 Annual Regulatory Burden Report, https://
www.mgma.com/getkaiasset/423e0368-b834-467c-a6c3-53f4d759a490/
2023%20MGMA%20Regulatory%20Burden%20Report%
20FINAL.pdf, Nov. 2023.
In the face of ongoing Medicare cuts, the cost of running a medical
practice continue to rise--according to MGMA data, physician practices
saw total operating cost per FTE physician increase by over 63% from
2013-2022, while the Medicare conversion factor increased by only 1.7%
over the same timeframe. Eighty-nine percent of medical groups reported
an increase in operating costs in 2023.\4\
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\4\ MGMA Stat poll, https://www.mgma.com/mgma-stat/higher-costs-
persist-for-medical-groups-even-as-inflations-growth-slows, July 12,
2023.
An annual inflation-based physician payment update based on the MEI is
needed to prevent further damage to rural medical groups' ability to
continue operating. Congress should pass the Strengthening Medicare for
Patients and Providers Act of 2023, which would provide an annual
Medicare physician payment update tied to inflation, as measured by the
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MEI.
Further, MGMA recommends the Committee work to mitigate the harmful
impact of Medicare's budget neutrality requirements. The Provider
Reimbursement Stability Act of 2023 would modernize many aspects of
Medicare budget neutrality and would make significant changes to
alleviate the adverse effects practices are experiencing. The
legislation would increase the triggering threshold from $20 million to
$53 million (while adding an update to keep pace with inflation),
institute new utilization review requirements to better reflect the
reality of providers using certain services compared to CMS' estimates,
and more.
'MGMA urges Congress to make changes to budget neutrality in unison
with the long-needed annual inflationary update. The current policies
work in concert to undermine the financial viability of medical
practices, as medical groups will be facing another cut in 2025 absent
congressional intervention.
Merit-based Incentive Payment System (MIPS) Reform
MACRA instituted the Quality Payment Program (QPP) that includes MIPS
which was intended to be an on-ramp in the transition to value-based
care for medical groups to join APMs. Unfortunately, the program has
been beset with issues. A study found that in 2019, physicians spent
more than 53 hours per year on MIPS-related activities and MIPS cost
practices $12,811 per physician to participate.\5\ Aside from onerous
reporting requirements that do not drive meaningful clinical
improvements and unfairly penalize clinicians, the $500 million funding
for the MIPS exceptional performance bonus expired at the end of 2022.
MGMA urges Congress to extend the exceptional performance bonus, which
will support physician practices as they work to comply with MIPS
requirements.
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\5\ Dhruv Khullar, Amelia Bond, Eloise May O'Donnell, Time and
Financial Costs for Physician Practices to Participate in the Medicare
Merit-based Incentive Payment System, https://jamanetwork.com/journals/
jama-health-forum/fullarticle/2779947, Jama Network, May 14, 2021.
Rural, small, and medically underserved practices can be
disproportionately disadvantaged under MIPS. The SURS program provided
direct support for these practices, but funding appropriated under
MACRA expired in February 2022. MGMA encourages Congress to extend this
critical program by passing the SURS Extension Act, as it is needed to
assist practices in rural and underserved areas understand the
continuously changing policies in MIPS and succeed in the program.
Healthcare Workforce
MGMA has been a longtime champion of increased funding and reasonable
improvements to the GME program, as the U.S. healthcare system will
face a shortage of up to 86,000 physicians by 2036.\6\ We appreciate
the progress Congress has made over the past few years adding Medicare-
funded GME slots through the Consolidated Appropriations Acts of 2021
and 2023, but there is still a critical need for more doctors to treat
our nation's aging population.
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\6\ Association of American Medical Colleges, The Complexities of
Physician Supply and Demand: Projections from 2021 to 2036, https://
www.aamc.org/media/75236/download?attach
ment, Mar. 2024.
The Resident Physician Shortage Reduction Act of 2023 is an important
bipartisan piece of legislation that would help address the physician
shortage facing the nation which is especially pronounced in rural
communities. This bill would increase Medicare-supported medical
residency positions by 14,000 over the course of 7 years. These slots
are a lifeline to ensuring patients have access to care and we urge the
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Committee to support its passage.
Similarly, the Teaching Health Center Graduate Medical Education
(THCGME) program provides essential training for doctors in certain
outpatient settings. The THCGME program represents a great opportunity
to address healthcare disparities since most of the teaching health
centers are in rural and high-need areas, with over 60% of the training
sites being in medically underserved communities according to Health
Resources and Services Administration. MGMA recommends the Committee
provide sustainable funding to this program to promote physicians
treating rural and underserved communities.
There are additional critical workforce challenges as staffing
shortages across clinical and nonclinical positions remain a concern
for medical group practices. Fifty-six percent of medical groups
reported staffing as their biggest productivity roadblock in an April
18, 2023, MGMA Stat poll.\7\ As Congress continues to examine ways to
bolster the healthcare workforce, MGMA hopes the Committee takes a
comprehensive view of the staffing concerns facing medical groups to
better strengthen the workforce programs under its purview.
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\7\ MGMA Stat poll, https://www.mgma.com/mgma-stats/as-healthcare-
staffing-woes-linger-reduced-capacity-remains-the-biggest-roadblock-to-
productivity, Apr. 20, 2023.
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Prior Authorization Burden Contributing to Staff Burnout
A major contributor to the healthcare workforce shortage is the
worsening problem of physician and staff burnout, with 65% of
physicians having reported experiencing burnout in 2022.\8\ Many of the
issues discussed in this letter compound to increase burnout--when you
add prior authorization requirements that MGMA members consistently
rank as their number one regulatory burden on top of these issues, it
only hastens staff resignations and employee turnover. MGMA is
increasingly alarmed by reports of rising prior authorization
requirements--89% of medical groups stated that prior authorization
requirements are very or extremely burdensome.\9\ Ninety-two percent of
physician practices reported having to hire or redistribute staff to
work on prior authorizations due to the increase in requests.\10\
Practices are already facing significant workforce shortage issues--
this situation is simply unsustainable.
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\8\ Jackson Physician Search and MGMA, Back from Burnout:
Confronting the Post-Pandemic Physician Turnover Crisis, https://
www.mgma.com/deep-dives/back-from-burnout-confronting-the-post-
pandemic-physician-turnover-
crisis?utm_source=referral&utm_medium=pressrelease&
utm_campaign=bde-gen-oct-2022-jpsreport, Oct. 7, 2022.
\9\ Supra note 4.
\10\ Id.
The Improving Seniors' Timely Access to Care Act, which we anticipate
will soon be reintroduced, would make welcomed changes to ease this
burden. Previous iterations of this legislation had widespread
bipartisan, bicameral support with over 53 Senators and 327
Representatives cosponsoring the bill in 2022. We strongly urge
Congress to pass this long-needed legislation, as well as the GOLD CARD
Act and the Reducing Medically Unnecessary Delays in Care Act as these
bills would make additional important changes to prior authorization.
Innovative Models and Technology
Telehealth
Over the past several years, telehealth technology has proven critical
in maintaining access to care throughout the COVID-19 Public Health
Emergency (PHE). Telehealth services are even more important for
patients in rural areas where the closest practice may be hours away
and patients may not have access to transportation. It is critical to
enact policies building off the demonstrable success of telehealth
services during the COVID-19 PHE to enable medical groups to best serve
patients where they are and not unnecessarily restrict care.
MGMA appreciates Congress' extension of many important telehealth
flexibilities through 2024 in the Consolidated Appropriations Act of
2023. Many of these policies, such as eliminating geographic and
originating site restrictions, should be permanently implemented as
telehealth should not be constrained to Medicare beneficiaries in
facilities located in rural areas, as required prior to the
flexibilities granted under the COVID-19 PHE waivers. Legislation like
the CONNECT for Health Act of 2023 would permanently institute many of
these policies, facilitating sustainable telehealth treatment for
patients.
APM Development
Value-based care (VBC) models must be designed to address the
challenges facing rural practices if CMS wants to meet its goal of
having every Medicare beneficiary in an accountable care arrangement by
2030. Rural practices face numerous barriers to both joining and
successfully participating in VBC arrangements as the application
requirements and parameters around many of the CMS Innovation Center
(CMMI) models often do not allow rural groups to participate. Seventy-
eight percent of medical groups reported that Medicare does not offer
an Advanced APM that is clinically relevant to their practice, with 56%
of members being interested in participating in a clinically relevant
model if one were to exist.\11\
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\11\ Id.
CMMI has yet to test any of the models PTAC has recommended and is
missing an important opportunity to expand methods of participation.
MGMA supports leveraging the expertise of PTAC to develop new,
voluntary, physician-led APMs that meet the needs of rural practices.
APM Incentive Payment and Qualifying Participant Threshold
Shifting program requirements and financial incentives instituted under
MACRA do not align with enabling rural practices to successfully
participate in APMs. Congress recently extended the APM incentive
payment at 1.88% for 2024--a decrease from 3.5% in 2023, and 5% in
2022. MGMA strongly urges Congress to reinstate the full 5% as this
payment is necessary to cover costs, support investments, and safeguard
the financial viability of medical groups in the program.
Further, the qualifying participation (QP) threshold to participate in
an APM is unreasonably high. Participants need to meet this threshold
to qualify for the APM incentive bonus and to avoid reporting under
MIPS; it was set to increase this year, but Congress intervened by
freezing the threshold in the Consolidated Appropriations Act of 2023.
Practices should not be subject to an excessively high threshold that
fosters uncertainty and hinders their ability to participate--MGMA
supports giving CMS the flexibility to adjust the QP threshold so that
it is not set arbitrarily high. The Value in Health Care Act of 2023
would work to address the APM incentive payment and QP threshold
problems facing practices and we support its passage.
Conclusion
MGMA thanks the Committee for its leadership in examining the multitude
of issues facing rural medical groups. We look forward to working with
you to craft commonsense policies that will allow medical groups in
rural areas to continue providing high-quality patient care. If you
have any questions, please contact James Haynes, Associate Director of
Government Affairs, at [email protected] or 202-293-3450.
Sincerely,
Anders Gilberg
Senior Vice President, Government Affairs
______
National Association of Chain Drug Stores
1776 Wilson Blvd., Suite 200
Arlington, VA 22209
703-549-3001
https://www.nacds.org/
Statement of Steven C. Anderson, FASAE, CAE, IOM,
President and Chief Executive Officer
Introduction
The National Association of Chain Drug Stores (NACDS) thanks Chairman
Wyden and Ranking Member Crapo for the opportunity to submit a
statement for the record for the Senate Committee on Finance's hearing
on ``Rural Health Care: Supporting Lives and Improving Communities.''
NACDS greatly appreciates the Committees work to improve healthcare
access, innovation, and lower costs. The U.S. healthcare system incurs
the highest spending and conversely yields the worst health outcomes,
compared to other high-income countries.\1\ The situation is even worse
for rural Americans, who tend to be sicker than their urban
counterparts. Rural Americans are more likely to die from heart
disease, stroke, cancer, chronic respiratory disease, and unintentional
injury.\2\ Causes of this tremendous disparity include lower access to
healthcare and social determinants of health such as poverty.\3\ To
achieve superior results, the nation desperately needs new solutions
and should look toward community pharmacies. Across the United States,
but especially in rural areas, Medicare beneficiaries visit pharmacies
significantly more often than primary care providers--14 visits
compared to 5 visits yearly.\4\ These visits offer critical touchpoints
to improve healthcare access, equity, and outcomes.
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\1\ The Commonwealth Fund. U.S. Health Care from a Global
Perspective, 2022: Accelerating Spending, Worsening Outcomes. January
2023, available at: https://www.commonwealth
fund.org/publications/issue-briefs/2023/jan/us-health-care-global-
perspective-2022.
\2\ https://www.cdc.gov/ruralhealth/
about.html#::text=More%20than%2046%20million%20
Americans,stroke%20than%20their%20urban%20counterparts.
\3\ Ibid.
\4\ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7364370/.
Meaningfully modernizing our healthcare system, including overdue
Pharmacy Benefit Manager (PBM) reform and better leverage of the unique
clinical expertise of the nation's pharmacies and pharmacists, will
help prioritize health outcomes, healthcare access, and reduce
spending. Stopping the egregious PBM practices that have proven
counterproductive to the nation's goals of lowering healthcare costs is
fundamental to better deploying pharmacies to help take care of rural
Americans. While community pharmacies continue to offer undeniable
scale and clinical expertise to profoundly improve patients' health
outcomes and save downstream healthcare dollars, this capacity remains
vastly untapped and undermined by pharmacy reimbursements from PBMs
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that are often below cost.
About 90% of Americans live within 5 miles of a community pharmacy \5\
and 86% of adults report that pharmacies are easy to access.\6\
Importantly, 97% of Americans live within 10 miles of a pharmacy.
Pharmacies are open extended hours--including nights and weekends--when
other healthcare providers are unavailable. Across populations, people
visit pharmacies more often than other healthcare settings. Moreover,
80% of Americans support pharmacists helping patients prevent chronic
diseases, a top driver of healthcare costs. And, nearly 3 out of 4
Americans support pharmacists testing for and treating common
illnesses, such as flu and COVID-19.\7\
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\5\ https://www.japha.org/article/S1544-3191(22)00233-3/fulltext.
\6\ https://accessagenda.nacds.org/dashboard/.
\7\ https://www.nacds.org/pdfs/Opinion-Research/NACDS-
OpinionResearch-National.pdf.
When pharmacies were more fully leveraged during the recent public
health emergency, pharmacy interventions averted more than 1 million
deaths, prevented more than 8 million hospitalizations, and saved $450
billion in healthcare costs.\8\ Additionally, a recent study found that
a 50% uptake of a pharmacist-prescribing intervention to improve blood
pressure control was associated with $1.137 trillion in cost savings
and could save an estimated 30.2 million life years over 30 years.\9\
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\8\ https://pubmed.ncbi.nlm.nih.gov/36202712/.
\9\ Dixon DL, Johnston K, Patterson J, Marra CA, Tsuyuki RT. Cost-
Effectiveness of Pharmacist Prescribing for Managing Hypertension in
the United States. JAMA Netw Open. 2023;6(11).
The accessibility and clinical expertise of pharmacists and pharmacies
lends very well to driving solutions that improve healthcare access,
promote innovations, and mitigate preventable spending that results
from suboptimal health outcomes. This includes helping to bridge gaps
in healthcare access resulting from the expected shortage of 86,000
physicians by 2036, which is likely to disproportionately harm rural
Americans.\10\ The unique footprint and infrastructure of community
pharmacies should be leveraged in advancing healthcare solutions for
the American people that prioritize outcomes, prevention, cost-savings,
access, and equity. To better leverage pharmacies in transforming
healthcare to help meet the needs of the American people, NACDS
strongly recommends the Committee members consider:
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\10\ https://www.aamc.org/news/press-releases/new-aamc-report-
shows-continuing-projected-physician-shortage.
1. Support ``Real PBM Reform'' with the passage of measures like
S. 2052, the Protect Patient Access to Pharmacies Act, H.R. 5400/S.
2436, the NO PBMs Act, and H.R. 1613/S. 1038, the Drug Price
Transparency in Medicaid Act as well as support broader reforms to halt
the manipulative practices of Pharmacy Benefit Managers (PBMs) that
continue to increase healthcare costs for patients and threaten the
viability of community pharmacies to continue serving their
communities, including in rural areas. PBM profits are soaring across
all payer types while they make people pay more for their medicines and
make it difficult for pharmacies of any size to stay open. People and
communities across this country rely on their pharmacies. Many of the
policies included in these measures are reflected in H.R. 5378, the
Lower Costs, More Transparency Act, which was recently passed by the
House of Representatives, and the Senate Finance Committee-approved
Better Mental Health Care, Lower-Cost Drugs, and Extenders Act. NACDS
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urges swift enactment of these reforms in 2024.
2. Support access to pharmacist services through the successful
passage of the Equitable Community Access to Pharmacist Services Act
(H.R. 1770/S. 2477) in Medicare Part B. S. 2477 seeks to foster
Medicare beneficiary choice to access pharmacist services for common
health threats, like influenza and COVID-19, building on the
effectiveness and broad reach of pharmacy-based care during the recent
public health emergency, including in rural and underserved areas, that
saved hundreds of billions of dollars in healthcare costs.\11\
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\11\ https://pubmed.ncbi.nlm.nih.gov/36202712/.
3. Encourage the inclusion of community pharmacies in innovative
healthcare models across public and private payers, especially in the
design and implementation of value-based care models that seek to
explore opportunities to expand healthcare access, advance healthcare
outcomes and equity, and promote healthcare savings.
1. PBM Reform
PBMs' opaque and self-serving business practices, including their abuse
of pharmacy performance measures in the Medicare Part D program, lead
to inflationary effects on drug prices, restrictions on patient access,
and unfair and below-cost pharmacy reimbursement. The ability of
pharmacies to provide prescription medications and related care to
patients in rural settings is often controlled and manipulated by the
three largest vertically integrated PBM insurers, which threatens
pharmacies' viability and the patients who rely on them for care and
access.
America's pharmacies have been struggling with reimbursement challenges
for decades, due to or exacerbated by the absence of oversight and
understanding of the competition-eroding practices of PBMs that impact
timely patient access, pharmacy sustainability, and pharmacy's
innovative vision to empower patients' total health and wellness. As
illustrated by MedPAC, Medicare Part D's direct and indirect
remuneration (DIR) fees, or fees that PBMs claw back from pharmacies
weeks or months after they pay pharmacy claims, skyrocketed from $8.7
billion (11%) in 2010 to $62.7 billion (29%) in 2021, which is in part
due to the expanded market leverage of PBM-insurers and a non-
transparent pharmaceutical supply chain. As we've seen historically,
these challenges could lead to beneficiary non-adherence, financial
harm to beneficiaries, downstream hospitalizations resulting in
increased healthcare costs, and more pharmacy closures.
NACDS applauds Chairman Wyden and Ranking Member Crapo for prioritizing
this bipartisan issue of PBM reform this Congress and for your
continued commitment to fight for better healthcare and lower costs for
Americans. Comprehensive PBM reform is needed to help our healthcare
system innovate and instill increased transparency and accountability
for PBMs, to help ensure the economic viability of pharmacies, and to
help foster heightened access to healthcare and improved health
outcomes for the people and communities they serve.
The Pharmacy Benefit Manager Marketplace and Impact on Pharmacies
Prescriptions filled by patients who are paying cash without any form
of insurance or discount card account for only about 3% of the total
volume of prescriptions.\12\ While approximately 91% of prescriptions
filled have a payment component coming from Medicare Part D, Medicaid,
or a commercial insurance plan, these plans are ordinarily administered
by PBMs. The top three PBMs manage about 80% of prescription drug
volume.\13\ Five of the top six PBMs are owned by large national health
insurers. This business environment makes it very difficult for
pharmacies to negotiate fair business practices and transparency
because the PBMs and health insurers have more commercial market power
and leverage in the relationship due to their size and scale. This
creates a one-way street with negative consequences for patients,
pharmacies, employers, taxpayers, and communities--seemingly for all
but the PBMs and payers.
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\12\ Source: IQVIA, National Prescription Audit & RxInsight, June
2022; Approximately 5.4% of patients use a discount card to assist with
payment.
\13\ https://www.xcenda.com/insights/skyrocketing-growth-pbm-
formulary-exclusions-concerns-patient-access.
Retail pharmacies are in crisis, facing unsustainable financial
pressures as they are increasingly reimbursed by payers below the cost
of buying and dispensing prescription drugs. Dire financial pressures
have forced an alarming number of pharmacies to take drastic steps,
such as possibly paring back hours of operation and delaying innovative
care services that otherwise could improve health outcomes. PBMs'
retroactive fees and claw backs often occur weeks or months after a
transaction closes, when the PBM arbitrarily decides to recoup a
portion of the pharmacy's reimbursement. These fees and claw backs have
made the economic viability of community pharmacies increasingly
difficult, due to the unpredictability of reimbursement and the
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increased damage to bottom lines.
PBM tactics may be contributing to pharmacy closures, which leads to a
reduction in access to vital healthcare services, especially in rural
areas where options are already limited. Communities across the nation
depend on neighborhood pharmacies among all healthcare destinations. A
recent study published in the Journal of the American Medical
Association found that pharmacy closures led to a significant drop in
medication adherence for older adults taking cardiovascular
medications, which has obvious, negative implications for patient
health and healthcare costs. Preserving patient access to robust
pharmacy provider services and networks like health screenings, disease
state management, vaccinations (e.g., flu, COVID-19), patient
counseling, medication adherence, and testing--all in addition to
essential medication access--can help improve health outcomes and
generate overall healthcare savings for Americans.
We look forward to continuing to work with the Committee and other
Members of Congress to stop the manipulation by PBMs both domestically
and internationally once and for all because the clock is ticking.
Without PBM reform, we can expect there to be continued increases in
patients' medication costs, limits on patients' choice of pharmacies,
restrictions on access to medicines that are right for patients, and
jeopardy of the sustainability of the pharmacies and pharmacy teams on
whom patients rely.
To that end, please see below NACDS' Principles of PBM Reform to
increase transparency and ensure comprehensive reform of harmful PBM
tactics and practices:
I. Help to Preserve Patient Access to Pharmacies by Addressing PBM's
Retroactive Pharmacy Fees
Retroactive DIR Fees/Claw Backs--Pharmacy access can be undermined when
health plans and their middlemen, PBMs, arbitrarily ``claw back'' fees
retroactively from pharmacies weeks or months after a claim has been
adjudicated/processed. This manipulation of pharmacy reimbursements may
diminish access to care (e.g., pharmacies being forced to close their
doors or pare back hours and healthcare services) when PBMs are
unpredictable, not transparent, and payment falls below a pharmacy's
costs to acquire and dispense prescription drugs. Policymakers should
consider enacting laws that prohibit payers or PBMs from retroactively
reducing and/or denying a processed pharmacy drug claim payment and
obligating them to offer predictable and transparent pharmacy
reimbursement to better protect pharmacies as viable and reliable
access points of care for patient services.
II. Provide Fair and Adequate Payment for Pharmacy Patient Care
Services
Reasonable Reimbursement & Rate Floor--Pharmacy access remains at risk
when PBMs reimburse pharmacies below the cost to acquire and dispense
prescription drugs. Pharmacy reimbursement that falls below the costs
to acquire and dispense prescription drugs threatens future
sustainability for pharmacies to continue providing valuable medication
and pharmacy care services to communities. Policymakers should enact
laws to adopt a reimbursement rate floor that requires PBMs to use
comprehensive reimbursement models that are no less than the true cost
to purchase and dispense prescription drugs to help maintain robust
public access to pharmacies.
Standardized Performance Measures--A crucial part of comprehensive DIR
fee reform is advancing pharmacy quality that improves outcomes for
beneficiaries and drives value in care which are essential to
controlling costs in the healthcare system. Arbitrary performance
measures developed by PBMs assess the performance of the pharmacy
without pharmacies' input and create a moving target for pharmacies to
show value and improve health outcomes. Measures vary across the
various plans and dictate DIR fees (or claw backs at the State level)
imposed on pharmacies, as well as help create substantial system
dysfunction and unnecessary spending in the Part D program.
Policymakers should enact laws to standardize PBMs' performance
measures for pharmacies to help set achievable goals for pharmacies
before signing a contract to promote harmonization in the healthcare
system and improvements in health outcomes.
III. Protect Patient Choice of Pharmacies
Specialty--Some PBMs require patients with rare and/or complex diseases
to obtain medications deemed ``specialty drugs'' from designated
``specialty pharmacies'' or mail-order pharmacies which impedes patient
access to their convenient local neighborhood pharmacies where
specialty drugs are filled as well. Prescription drugs should not be
classified as ``specialty drugs'' based solely on the cost of the drug
or other criteria used to limit patient access and choice--instead,
should focus on clinical aspects such as requiring intensive clinical
monitoring. Policymakers should enact laws to establish appropriate
standards for defining and categorizing specialty drugs to ensure
comprehensive and pragmatic patient care and access and prohibit PBMs
from steering patients to only specialty pharmacies, including those
owned by the PBMs, for their prescription needs.
Mail Order--Medication access and care can be weakened when PBMs
manipulate the system by requiring patients to use mail-order
pharmacies only. Some plans impose penalties such as higher copays or
other financial disincentives for choosing a retail pharmacy instead of
a mail-order pharmacy which is often owned by the PBM. Policymakers
should support patient choice and access by enacting laws to prohibit
PBMs from requiring or steering patients to use mail-order pharmacies.
Any Willing Pharmacy--Due to PBMs' network and contract barriers,
pharmacies willing and ready to serve patients may be ineligible to
provide important pharmacy services and patients may experience
unnecessary delays and interruptions in patient care. Patients should
have the choice and flexibility to utilize the pharmacy that best meets
their healthcare needs. Policymakers should enact laws that require
PBMs and plans to include any pharmacies in their networks if the
pharmacy is willing to accept the terms and conditions established by
the PBM to help maximize patient outcomes, and cost savings and ensure
patient access to any willing pharmacy of their choice.
IV. Enforce Laws to Stop PBM Manipulation and Protect Pharmacies and
Patients
Audits--PBMs routinely conduct audits to monitor a pharmacy's
performance and reverse or claw back pharmacy payments when there are
alleged issues with a particular pharmacy claim. PBM audits interrupt
the pharmacy workflow, can extend wait times, and detract attention
from the quality of care patients receive. Policymakers should enact
laws that support fair pharmacy audit practices to ensure timely
patient care delivery at community pharmacies and bring efficiency,
transparency, and standardization to the PBM audit process.
Oversight Authority--There are growing concerns that pro-pharmacy and
pro-
patient legislative successes might be undercut if PBMs fail to comply
with such laws and/or states fail to fully enforce these laws. Such
failure could significantly impact pharmacy reimbursement and overall
patient access. Policymakers should establish and enforce laws already
on the books to regulate harmful PBM reimbursement practices that may
harm patients and the healthcare system as we know it, especially at
the pharmacy counter, and empower state regulators to do the same to
enforce PBM transparency and fair and adequate pharmacy reimbursements.
2. Support Access to Pharmacist Services
Despite their proven ability to improve health outcomes and save
downstream healthcare dollars, today, pharmacists are among the only
healthcare professionals omitted from Medicare statute as Part B
providers. Consequently, pharmacists' accessibility and clinical
expertise have been largely untapped in promoting better care quality,
value, and access, including in rural and underserved communities.
Bipartisan legislation (H.R. 1770/S. 2477, the Equitable Community
Access to Pharmacist Services Act) would help address this omission in
Medicare by providing payment for essential pharmacist services under
Medicare Part B and ensure pharmacists can continue to protect
vulnerable senior communities. As mentioned above, pharmacy
interventions during the COVID-19 pandemic averted more than 1 million
deaths, prevented more than 8 million hospitalizations, and saved $450
billion in healthcare costs.\14\ This legislation builds on that proven
success and would help support Medicare beneficiaries with the option
to seek routine care for common illnesses from their local pharmacies.
This legislation is critical to helping enhance access and quality, in
a manner that meaningfully supplements existing care capacity in a
tangible and cost-effective way. Consider, for example, individuals who
may benefit from having additional access options and the choice to
seek routine healthcare services at their local pharmacies, instead of
foregoing care until their condition worsens and ultimately leads to a
costly hospital visit that could have been avoided. Congress can help
the nation achieve a healthier and more sustainable healthcare
ecosystem, prioritizing access, outcomes, and value, especially in
rural communities, by supporting the successful passage of the
Equitable Community Access to Pharmacist Services Act.
---------------------------------------------------------------------------
\14\ https://pubmed.ncbi.nlm.nih.gov/36202712/.
Throughout the COVID-19 public health emergency, pharmacies were a
trusted, equitable provider of vaccinations, tests, and antivirals,
providing about 340 million COVID-19 vaccines, in addition to more than
42 million tests, and dispensing more than 8 million antiviral
courses.\15\ Compared to medical centers, pharmacies provided more than
90% of COVID-19 vaccinations.\16\ During 2022-2023, more than two-
thirds of adult COVID-19 vaccinations were administered at
pharmacies.\17\ With respect to testing, pharmacies provided 87% of the
free tests administered through the Improving Community Access to
Testing (ICATT) program.\18\ Similarly, in considering pharmacies'
impact on antiviral access, HHS reported that 87.5% (35,000 of the
40,000) antiviral dispensing sites were pharmacies.\19\ Pharmacies
unequivocally demonstrated their ability to meaningfully expand
critical access to care across vulnerable communities during the recent
public health emergency, and the American people have taken notice.
According to a poll conducted by Morning Consult and commissioned by
NACDS in October 2023, 81% of adults in the U.S. believe it's important
for their state to update its policies to ensure that patients
permanently have the same access to pharmacy vaccination, testing, and
treatment services that were available during the COVID-19
pandemic.\20\
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\15\ https://www.liebertpub.com/doi/10.1089/hs.2023.0085.
\16\ https://www.iqvia.com/insights/the-iqvia-institute/reports/
trends-in-global-adult-vaccination.
\17\ https://www.liebertpub.com/doi/10.1089/hs.2023.0085.
\18\ Miller MF, Shi M, Motsinger-Reif A, Weinberg CR, Miller JD,
Nichols E. Community-based testing sites for SARSCoV-2--United States,
March 2020-November 2021.MMWR Morb Mortal Wkly. 2021;70(49):1706-1711.
\19\ U.S. Department of Health and Human Services. https://
www.hhs.gov/about/news/2023/04/14/factsheet-hhs-announces-amend-
declaration-prep-act-medical-countermeasuresagainst-covid19.html.
\20\ https://www.nacds.org/pdfs/Opinion-Research/NACDS-
OpinionResearch-National.pdf.
Not only did pharmacies provide unparalleled access to COVID-19
vaccines, tests, and antivirals, pharmacies surpassed expectations when
it came to serving vulnerable and underserved communities. For example,
43% of people vaccinated through the Federal Retail Pharmacy Program
were from racial and ethnic minority groups, exceeding CDC's goal of
40%--the approximate percent of the U.S. population comprised of racial
and ethnic groups other than non-Hispanic White.\21\ Pharmacies also
supported concerted efforts to foster testing and antiviral access in
vulnerable and rural communities, helping to ensure access points
across diverse populations, especially in those communities without
other healthcare providers within reach.
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\21\ https://www.gao.gov/assets/720/718907.pdf.
We urge the Committee to leverage community pharmacies moving forward
to help achieve your goals to improve health and lower downstream
spending, including in rural and underserved areas. It is clear that
the American people deserve more accessible options to improve their
health, including access to the clinical care and expertise of their
local pharmacist that proved irreplaceable over the last three years.
The Committee can help make better health and lower downstream costs a
reality by supporting the successful passage of the Equitable Community
Access to Pharmacist Services Act. More information on this important
legislation is available from the Future of Pharmacy Care Coalition.
3. Encourage the Inclusion of Community Pharmacies in Innovative
Healthcare Models
Healthcare payment model reform to reward value-based care, better
quality, and improved clinical outcomes can help align incentives
toward what really matters--better health, while lowering unnecessary
and preventable costs for our healthcare system. However, despite a
multitude of research examples and published literature on the value of
pharmacies and pharmacists to improve health outcomes through clinical
services and save downstream healthcare dollars, pharmacists and
pharmacies have yet to be directly engaged as care providers in the
existing CMS Innovation Center's value-based care models--and further
opportunities exist to engage pharmacies in value-based care across
commercial payers, as well. NACDS urges the Committee to consider
opportunities for commercial plans to include pharmacists and
pharmacies in innovative healthcare models, including value-based care.
More detail on the tremendous value of including pharmacies in the CMS
Innovation Center's work, for example, to advance value-based care can
be found in a 2021 report.
The 2021 report highlights a myriad of evidence supporting the clinical
effectiveness of pharmacists to move the needle on healthcare quality,
outcomes, and value, including in rural and underserved populations.
For example, a CMS Innovation Center-funded, pharmacy-led chronic care
management initiative was designed to serve an underserved population.
This initiative aimed to optimize patient health and reduce avoidable
hospitalizations and emergency visits for high-risk patients by
integrating pharmacists into safety net clinics. This collaborative
program resulted in reduced rates of uncontrolled blood sugar by nearly
a quarter (23%), improvements in LDL with 14% more patients controlled,
and improvements in blood pressure with 9% more patients controlled at
6 months in the intervention group (collaborative care model with
pharmacists as leads) versus the control group (primary care physicians
only). Through this project, pharmacists identified 67,169 medication-
related problems in 5,775 patients, which resulted in a 33% reduction
in readmissions per patient per year.\22\
---------------------------------------------------------------------------
\22\ Chen SW. Comprehensive Medication Management (CMM) for
Hypertension Patients: Driving Value and Sustainability. University of
Southern California. http://betheresandiego.org/storage/files/cmm-for-
htn-usc-steven-chen-condensed-slide-deck.pdf; Chen SW. Integration of
Pharmacy Teams into Primary Care. The Center for Excellence in Primary
Care and the Center for Care Innovations. May 2015. https://
www.careinnovations.org/wp-content/uploads/2017/10/
USC.CEPC_.pharm_webinar_FinalV.pdf.
Additionally, pharmacists as medication experts are positioned to help
reverse increased spending attributable to suboptimal medication use
and promote better health outcomes. For example, it was estimated that
up to $21.9 billion could be saved within the U.S. healthcare system by
optimizing medication use.\23\ Also, it has been estimated that lack of
medication adherence causes 125,000 deaths, at least 10% of
hospitalizations, and hundreds of billions of preventable healthcare
spending.\24\ Healthcare spending on non-optimal medication therapy is
estimated at $528.4 billion per year \25\ and medication non-adherence
is estimated to cost the system $290 billion per year.\26\ Importantly
for Medicare beneficiaries, it was recently estimated that medication
nonadherence for diabetes, heart failure, hyperlipidemia, and
hypertension resulted in billions of Medicare fee-for-service
expenditures, millions in hospital days, and thousands of emergency
department visits that could have been avoided. If the 25% of
beneficiaries with hypertension who were nonadherent became adherent,
Medicare could save $13.7 billion annually, with over 100,000 emergency
department visits prevented and 7 million inpatient hospital days that
could be averted.\27\ Pharmacists can help curb these wasteful spending
trends and improve health more broadly.
---------------------------------------------------------------------------
\23\ Shrank WH, Rogstad TL, Parekh N. Waste in the U.S. Health Care
System: Estimated Costs and Potential for Savings. JAMA. Published
online October 07, 2019322(15):1501-1509. doi:10.1001/jama.2019.13978.
\24\ Viswanathan M, Golin CE, et al. Interventions to Improve
Adherence to Self-Administered Medications for Chronic Diseases in the
United States: A Systematic Review. Ann Intern Med. 2012. https://
annals.org/aim/fullarticle/1357338/interventions-improve-adherence-
self-administered-medications-chronic-diseases-united-states.
\25\ Watanabe JH, McInnis T, Hirsch JD; ``Cost of Prescription-Drug
Related Morbidity and Mortality;'' Annals of Pharmacotherapy; March 26,
2018. http://journals.sagepub.com/doi/10.1177/1060028018765159.
\26\ Rosenbaum L, Shrank WH; ``Taking Our Medicine--Improving
Adherence in the Accountability Era''; New England Journal of Medicine;
August 22, 2013. Shrank WH, Polinski JM; ``The Present and the Future
of Cost-Related Non-Adherence in Medicare Part D;'' J Gen Intern Med
30(8):1045-6.
\27\ Lloyd, Jennifer T., Maresh, Sha, Powers, Christopher, Shrank,
WH, Alley, Dawn E; ``How Much Does Medication Nonadherence Cost the
Medicare Fee-for-Service Program?''; Medical Care; January 2019.
Also, looking across quality measures used in existing CMS programs,
pharmacists are well positioned to help address a wide variety of
quality measures by optimizing medication use, improving uptake of
preventive care, like screenings and vaccinations, and supporting
improvements in chronic disease control. Research continues to support
pharmacists' ability to meaningfully impact these priority clinical
areas, yet pharmacies and pharmacists have not had the opportunity to
directly engage in the CMS Innovation Center's models, and
opportunities exist to further leverage pharmacies in innovative
---------------------------------------------------------------------------
healthcare models across private payers, as well.
The Committee should act on opportunities to improve outcomes, advance
access, and reduce preventable healthcare spending by leveraging
community pharmacies in innovative healthcare models. Doing so would
not only strengthen development of innovative care models, but would
also support needed advancements in healthcare access, including in
rural areas, in addition to healthcare technology and data
interoperability.\28\
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\28\ https://leavittpartners.com/wp-content/uploads/2023/04/
Pharmacy-Data-Interoperability-04.03.23.pdf.
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Conclusion
NACDS thanks the Committee for the opportunity to share ideas on how
Congress can meaningfully improve healthcare especially for rural
Americans. As PBMs attempt to run out the clock on real PBM reform, we
urge the Committee to continue to keep this bipartisan healthcare
matter top of mind this Congress to help protect Americans and their
pharmacies. For questions or further discussion, please contact NACDS'
Sara Roszak, Senior Vice President, Health and Wellness Strategy and
Policy at [email protected] or 703-837-4251.
Links:
https://pharmacycare.org/
https://www.nacds.org/pdfs/pharmacy/2021/
MedicareMedicaidInnovationMission.pdf
______
National Association of Rural Health Clinics
1009 Duke Street
Alexandria, VA 22314
On behalf of the over 5,500 Rural Health Clinics (RHC) across the
nation, we sincerely appreciate the opportunity to provide a statement
for the record.
The RHC program, first created in 1977, provides outpatient care for
over 60% of rural America and 11% of the entire country (approximately
38.7 million patients). Overall, the Rural Health Clinic program has
been tremendously successful at bolstering access to healthcare across
rural America. However, we hope this statement will serve as a resource
for the Committee on healthcare trends presenting challenges and
opportunities unique to RHCs.
While much of the conversation around rural health is surrounding rural
hospitals and other inpatient facilities, we implore the Committee to
prioritize legislation that supports the sustainability of the entire
healthcare delivery system in rural communities--inpatient and
outpatient.
This statement is centered around the following RHC-specific issues:
1. Telehealth Policy;
2. Outdated Conditions of Certification for RHCs; and
3. Medicare Advantage;
Telehealth Policy
Telehealth represents a massive opportunity to improve access to care
in rural areas. However, the current telehealth policy threatens rural
health clinics, giving fee-for-service providers stronger incentives to
invest in telehealth than safety-net providers. The longer this remains
the case, the more likely it is that RHCs and FQHCs will fall behind in
the adoption of telehealth relative to their traditional peers.
RHCs and FQHCs were not included in HHS's emergency expansion of
telehealth policy. For a few weeks at the beginning of COVID, fee-for-
service providers were able to offer telehealth services to their
patients, while RHC and FQHC patients were forced to come in-person to
receive a Medicare-covered healthcare service. The CARES Act rectified
this issue and allowed RHCs and FQHCs to serve as distant site
providers but that legislation did not allow RHCs and FQHCs to bill for
telehealth normally. Instead, the CARES Act created a ``special payment
rule'' that paid RHCs outside their normal All-Inclusive Rate
methodology at a level that is significantly less than what RHCs
receive for in-person services. This stands in stark contrast to
traditional physician offices which receive payment parity between in-
person and telehealth services.
We are concerned with this ``special payment rule'' methodology for a
whole host of reasons. First and foremost, the payment is significantly
less than what most RHCs and FQHCs would receive for providing the same
service in person, disincentivizing safety-net providers from offering
the service via telehealth. Second, the current rules require RHCs and
FQHCs to ``carve-out'' all telehealth costs from their cost report,
which adds significant administrative burden to the cost-reporting
process. Third, the use of a single telehealth code, G2025, billed
whenever an RHC provides one of the 200+ telehealth services
reimbursable by Medicare, has prevented RHCs from tracking annual
wellness visits and other services provided via telehealth properly,
which hinders their ability to properly participate in ACOs and other
quality programs.
Complicating matters is the fact that for mental health services
provided via telehealth, RHCs and FQHCs do use their normal coding and
reimbursement mechanisms. This policy is working well, and we believe
that telehealth should work this way for all services, not just mental
health services. Furthermore, despite receiving reimbursement parity
for mental health services delivered via telehealth, data has not shown
widespread improper utilization of this benefit, i.e., non-safety net
providers taking advantage of the enhanced reimbursement methodology.
We are pleased to see legislation introduced this Congress that would
rectify this payment issue, including the CONNECT for Health Act of
2023 (S. 2016) and the Telehealth Modernization Act (S. 3967). These
would both eliminate the special payment rule in favor of normal
payment rules for RHCs and FQHCs.
We are pleased to see the recent work of the House committees of
jurisdiction on telehealth post-2024. The Energy and Commerce
Subcommittee on Health marked up and unanimously advanced a package of
telehealth flexibilities based on the Telehealth Modernization Act,
through December 31, 2026. Notably, this legislation includes a fix to
the current RHC/FQHC telehealth reimbursement disparity.
While the Ways and Means Committee also advanced a 2-year extension,
they simply extended current RHC/FQHC policy, i.e., a continuation of
the special payment rule and payment disparity.
We look forward to seeing the Senate Finance Committee's continued work
on this issue prior to current flexibilities expiring on December 31,
2024, and urge the Committee to rectify the RHC/FQHC telehealth
reimbursement disparity in the next extension, demonstrating its
ongoing support of our nation's outpatient safety-net providers and the
patients they serve.
Outdated Conditions for Certification
The Rural Health Clinic program was created in 1977, and the
regulations governing the conditions for certification were finalized
in 1978. As you might imagine, the 45-year-old ruleset is in severe
need of modernization. For this reason, we strongly support the Rural
Health Clinic Burden Reduction Act (S. 198), which is a compilation of
uncontroversial and cost-neutral policies that simply modernize the RHC
conditions for certification.
When RHCs were created, the program broke ground by being the first
place where Nurse Practitioners could bill Medicare directly for their
services. However, as this was new territory for Nurse Practitioners,
Congress included a series of physician oversight responsibilities as a
condition for RHC certification.
Flash forward to 2023, and 27 states have granted Nurse Practitioners
full practice authority. But state scope of practice does not matter if
the NPs work in a Rural Health Clinic because the RHC conditions for
certification still require physicians to see patients in the clinic
and review medical charts among other oversight responsibilities. The
end result is that these NP-led RHCs are forced to comply with outdated
federal RHC scope of practice rules even though they would have full
practice authority in other facility types in their state.
The current statute governing conditions for certification as an RHC
simply does not allowing clinicians to practice to the top of their
license. The RHC Burden Reduction Act would rectify this by aligning
RHC scope of practice laws with state scope of practice laws.
Other outdated conditions for certification require RHCs to maintain
lab equipment that is rarely used and discourage the integration of
behavioral health in the RHC setting. These rules only add unnecessary
burden and cost for RHCs. Congress has an opportunity to improve rural
health in a cost-neutral manner by passing the RHC Burden Reduction Act
to modernize the Rural Health Clinic conditions for certification.
Medicare Advantage
The RHC program incentivizes providers to practice in rural areas
through two major benefits: enhanced Medicaid reimbursement and
enhanced traditional Medicare reimbursement.
Operating as an RHC provides no benefit relative to Medicare Advantage
(MA) reimbursement. This fact stands in contrast to Federally Qualified
Health Centers (FQHCs), who receive supplemental payments from Medicare
which make up the difference between what traditional Medicare would
pay and what the Medicare Advantage plans contract with them for. This
policy ensures that FQHCs are not disadvantaged if their patients are
increasingly choosing to enroll in Medicare Advantage plans.
As Medicare Advantage enrollment now exceeds traditional Medicare
enrollment, RHCs are facing increasing financial strain from MA plans
who are spreading rapidly in certain rural markets and refuse to pay
RHCs the All-Inclusive Rate (AIR) that traditional Medicare does. In a
recent NARHC survey, 48% of RHC respondents indicated that MA
reimbursed them slightly (18.4%) or significantly (29.5%) less than
traditional Medicare.
Additionally, RHCs must negotiate contracts with each and every
Medicare Advantage plan and are reimbursed according to the terms of
that contract. Some RHCs are able to negotiate reimbursement comparable
to traditional Medicare but many RHCs have little leverage to walk away
from the negotiating table in areas where Medicare Advantage plans have
significantly increased enrollment. These negotiation challenges also
may increase pressures on RHCs to consolidate as oftentimes larger
systems have more negotiating power.
These data points are of significant concern to RHCs. Without adequate
reimbursement, RHCs will no longer be able to provide essential
outpatient services in rural, medically underserved communities across
the country.
NARHC advocates for the creation of a reimbursement floor policy. Such
a policy would allow RHCs and Medicare Advantage plans to continue to
negotiate contracts with each other while also ensuring that MA plans
must offer a reasonable reimbursement level that does not jeopardize
access to care. As the FQHC wrap policy provides FQHCs benefits
relative to Medicare Advantage, an RHC floor payment policy would
ensure that the shift from traditional Medicare to Medicare Advantage
does not harm access to care in rural America.
Additionally, like nearly all providers across the country who contract
with Medicare Advantage plans, Rural Health Clinics feel immense
administrative burden associated with the stringent prior authorization
utilized by MA plans. NARHC is appreciative of the efforts by CMS to
lessen these impacts and reduce the waiting time as well as increase
transparency on the cause for denials, however particularly for rural
patients with transportation challenges, any prior authorization
timeline longer than real-time decisions significantly delays and
interrupts access to care.
RHCs consistently report the need, but not the financial resources, to
hire additional administrative staff to process prior authorizations,
as well as track down reasons for denials, including for previously
approved care. We encourage the Committee to consider further
opportunities to address these access barriers this Congress, as well
as to hold plans accountable for negative impacts to the health of the
patient resulting from their delays and denials.
Conclusion
The National Association of Rural Health Clinics thanks the Senate
Finance for organizing this hearing. We hope that the above statement
helps illuminate some of the policy obstacles and opportunities facing
the 5,500 Rural Health Clinics across the country. Should the Committee
have any questions, the NARHC is happy to serve as a resource. Please
contact us by phone at (202) 543-0348, and email us at
[email protected], or [email protected].
Links:
https://www.narhc.org/News/30432/Survey-Emphasizes-Scale-and-
Significance-of-the-RHC-Program
https://www.narhc.org/News/28244/NARHC-Sends-Letter-to-Trump-
Administration-on-Telehealth-Services-During-Covid-19-Pandemic
https://www.narhc.org/News/28271/CARES-Act-Signed-Into-Law
https://www.narhc.org/narhc/RHC_Burden_Reduction_Act.asp
https://ojin.nursingworld.org/table-of-contents/volume-26-2021/number-
2-may-2021/post-covid-19-reimbursement-parity-for-nurse-practitioners/
______
National Community Pharmacists Association
100 Daingerfield Road
Alexandria, VA 22314-2888
703-683-8200 Phone
703-683-3619 Fax
https://www.ncpa.org/
Chairman Wyden, Ranking Member Crapo, and members of the committee:
The National Community Pharmacists Association (NCPA) welcomes the
opportunity to provide a statement for the record to the full committee
hearing on Rural Health Care: Supporting Lives and Improving
Communities. NCPA represents America's community pharmacists, including
19,400 independent community pharmacies. Almost half of all community
pharmacies provide long-term care services and play a critical role in
ensuring patients have immediate access to medications in both
community and long-term care (LTC) settings. Together, our members
represent a $94 billion healthcare marketplace, employ 230,000
individuals, and provide an expanding set of healthcare services to
millions of patients every day. Our members are small business owners
who are among America's most accessible healthcare providers.
With 44% of independent community pharmacies located in an area with
populations less than 10,000,\1\ our members are deeply embedded in the
fabric of rural communities, providing essential health care services
to millions of Americans living in underserved areas. Research from the
USC-NCPA Pharmacy Access Initiative shows that across the country,
roughly 25% of neighborhoods are pharmacy shortage areas,\2\ and when a
pharmacy shortage area gains pharmacy access, it is most likely due to
an independent pharmacy opening.\3\ Through our advocacy efforts,
educational programs, and innovative initiatives, NCPA is committed to
ensuring access to quality health care for all, regardless of
geographic location.
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\1\ National Community Pharmacists Association. NCPA Digest 2023.
[Internet]. Alexandria (VA): National Community Pharmacists
Association; [cited 2024 May 15]. Available from: https://ncpa.org/
sites/default/files/2023-10/2023-digest.pdf.
\2\ USC Schaeffer. High-Tech Map Promotes Access to Medicine and
Pharmacy Services. USC Schaeffer. [Internet]. 2022 October 21. [cited
2024 May 15]. Available from: https://healthpolicy.usc.edu/article/
high-tech-map-promotes-access-to-medicine-and-pharmacy-services/.
\3\ USC-NCPA Pharmacy Access Initiative research.
Rural communities face unique challenges in accessing quality health
care services. Limited resources, including healthcare facilities and
providers, geographic isolation, and socioeconomic factors, contribute
to disparities in health outcomes. These challenges are further
exacerbated by the closure of rural hospitals and the shortage of
primary care physicians, leaving many rural residents without access to
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critical health services.
Community pharmacists play a vital role in addressing these challenges
and improving health outcomes in rural areas. As trusted healthcare
providers, pharmacists are often the most accessible healthcare
professionals in rural communities. They provide essential services,
including medication therapy management, immunizations, chronic disease
management, and preventive care screenings, helping patients manage
their health conditions and avoid costly hospitalizations.
We are pleased to highlight the USC-NCPA Pharmacy Access Initiative, a
collaborative effort between the University of Southern California
(USC) School of Pharmacy and NCPA, aimed at expanding access to
pharmacy services in underserved communities. This initiative has
developed a Pharmacy Shortage Areas Mapping Tool, which identifies
pharmacy shortage areas at the neighborhood level. This tool was
developed using prior research from the University of Southern
California College of Pharmacy combined with spatial analysis. An
example of the mapping generated is shown below in Figure 1 and Figure
2.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The Pharmacy Shortage Areas Mapping Tool can also be used to see
the formation of pharmacy shortage areas due to pharmacy closures.
According to research from the USC-NCPA Pharmacy Access Initiative, 104
rural neighborhoods became pharmacy shortage areas between 2018 and
2020, and 80% of these newly designated pharmacy shortage areas were
due to an independent pharmacy closing its doors. While the USC-NCPA
Pharmacy Access Initiative seeks funding for updated data to generate a
timelier estimate, we anticipate that the drastic number of pharmacy
closures across the country has caused the number of pharmacy shortage
areas to increase, including in rural communities. IQVIA estimates that
in 2023, over 1,000 pharmacies closed across the country.
As policymakers, there are several actions you can take to support
rural health care and strengthen the role of community pharmacists:
1. Request CMS to reevaluate and update current pharmacy access
standards in Medicare Part D to ensure that those living in rural areas
have access to brick-and-mortar pharmacies. CMS must update Medicare
Part D pharmacy access standards to reflect socioeconomic status and
access to transportation. Through our research with the USC-NCPA
Pharmacy Access Initiative, we have seen that current access standards
do not reflect true pharmacy access and have outlined our pharmacy
access distance thresholds based on research from and prior to the
creation of the Pharmacy Shortage Areas Mapping Tool in Table 1 below.
In comparing access using our pharmacy access distance thresholds to
the current CMS Medicare Part D access standards, we found that many
neighborhoods that lack pharmacy access are not captured using the CMS
Medicare Part D access standards of 2-mile (urban), 5-mile (suburban),
and 15-mile (rural) distance thresholds.
New access standards at a minimum should account for low access
to transportation by lowering the distance threshold in these areas to
no more than 0.5 miles to an in-network pharmacy, regardless of
urbanicity. In areas without transportation access issues, urban
neighborhoods should be within 1 mile of a pharmacy, suburban
neighborhoods should be within 2 miles of a pharmacy, and rural
neighborhoods should be within 10 miles of a pharmacy.
Table 1. Distance Thresholds Used in the Analysis
------------------------------------------------------------------------
Tract Distance
Urbanicity a Characteristics b Threshold CMS Standards c
------------------------------------------------------------------------
Urban Low-income and low- 0.5 mile 2 miles
vehicle ownership
------------------------------------------------------
Urban N/A 1 mile
------------------------------------------------------------------------
Suburban Low-income and low- 0.5 mile 5 miles
vehicle ownership
------------------------------------------------------
Suburban N/A 2 miles
------------------------------------------------------------------------
Rural Low-income and low- 0.5 mile 15 miles
vehicle ownership
------------------------------------------------------
Rural N/A 10 miles
------------------------------------------------------------------------
a Urbanicity is based on population density; (> 3,000, Urban population
per square mile; 1,000-3,000 population per square mile, Suburban; <
1,000 populating per square mile, Rural).
b Low-income indicated at least 20% of the tract population has incomes
less than 100% of the FPL, and low-vehicle ownership indicates at
least 100 households without a vehicle for the tract.
c Based on a memorandum issued by the Centers for Medicare and Medicaid
Services (CMS) for Part D plans.
2. Expand pharmacist scope of practice: Remove regulatory barriers
and enable pharmacists to practice at the top of their license,
allowing them to provide a wider range of services, including
prescribing medications and conducting point-of-care testing.
In conclusion, the National Community Pharmacists Association is
committed to improving health outcomes in rural communities and
ensuring access to quality pharmacy services for all Americans. Through
initiatives like the USC-NCPA Pharmacy Access Initiative and with the
support of policymakers like you, we can make meaningful progress in
addressing the unique healthcare needs of rural America. Thank you for
your attention to this important issue, and I look forward to working
together to build healthier, stronger communities across the nation.
Should you require further information or have questions, please reach
out to anne.cassity@
ncpa.org or 703-838-2682.
______
National Rural Health Association
50 F St., NW, Suite 520
Washington, DC 20001
202-639-0550
https://www.ruralhealth.us/
May 30, 2024
U.S. Senate
Committee on Finance
219 Dirksen Senate Office Building
Washington, DC 20510
Dear Chairman Wyden and Ranking Member Crapo:
The National Rural Health Association (NRHA) appreciates the
opportunity to submit this statement for the record on the Rural Health
Care: Supporting Lives and Improving Communities held by the full
Committee on May 16, 2024.
NRHA is a non-profit membership organization with more than 21,000
members nationwide that provides leadership on rural health issues. Our
membership includes nearly every component of rural America's health
care, including rural community hospitals, critical access hospitals,
doctors, nurses, and patients. We work to improve rural America's
health needs through government advocacy, communications, education,
and research.
Rural health care needs support more than ever. Using hospitals as a
proxy for the well-being of rural health care generally, over 170 rural
hospitals have closed or discontinued inpatient services since 2010.
Nearly 450 more rural hospitals are considered vulnerable to closure
with 50% operating with negative margins. Congress must invest in rural
health to ensure providers remain open and accessible to rural
residents. Approximately 80% of rural America is medically underserved
and seeing historic workforce shortages. As the Committee states, rural
residents face unique barriers to accessing health care and tend to be
older, sicker, and poorer than their urban counterparts. The policy
solutions in our response would have a significant impact on access,
affordability, and provider stability.
Summary Recommendations for Congressional Action
Congress has reconfirmed their commitment to the rural communities
repeatedly over the years by providing new protections to ensure rural
provider viability and to ensure patient access to health care services
in rural communities. NRHA and its members share this goal of ensuring
that federal health care payment policies recognize the unique practice
environment in rural areas and the important contributions rural
providers bring to the Medicare program and its beneficiaries.
NRHA appreciates the opportunity to provide these comments and requests
that the Finance Committee consider and advance the following
legislation to improve access to health care in rural communities:
S. 3967, the Telehealth Modernization Act and S. 2016, the
CONNECT for Health Act and to make all Medicare telehealth
flexibilities permanent and create payment parity for Rural Health
Clinics (RHCs)
S. 948, the Healthy Moms and Babies Act aims to improve maternal
and child health by increasing services, supports, and access to
coordinate care and technology in rural areas
S. 803, the Save Rural Hospitals Act, aims to enhance
reimbursements to more accurately reflect the actual costs incurred by
these hospitals
S. 1110, the Rural Hospital Support Act, to make Medicare
Dependent Hospital (MDH) and Low-Volume Hospital (LVH) programs
permanent is essential to provide certainty to hospitals and safeguard
their financial viability moving forward
S. 1571, the Rural Hospital Closure Relief Act, to allow a
limited waiver of the 35-mile requirement for Critical Access Hospital
(CAH) to assist struggling rural PPS hospitals
S. 4322, the Rural Emergency Hospital Improvement Act, to
implement technical fixes to the REH designation
S. 198, the RHC Burden Reduction Act would address RHCs outdated
legislative barriers
S. 1673, the Protecting Access to Ground Ambulance Medical
services Act, extends increases Medicare payments for rural ground
ambulance services
S. 230, the Rural Physician Workforce Production Act which would
lift GME caps and foster a more equitable distribution of medical
education resources to rural areas
H.R. 8235, the Rural Physician Workforce Preservation Act, to
exclude reclassified hospitals from receiving slots allocated to rural
hospitals unless geographically located in a rural area
S. 2418, the Improving Care and Access to Nurses Act, to
modernize Medicare policies, removing barriers that currently restrict
the practice capabilities of these professionals
Further, NRHA encourages Committee members to collaborate with
colleagues to support legislation outside their immediate jurisdiction
including:
S. 3193, the Telehealth Response for E-prescribing Addiction
Therapy Act allows telehealth, including audio-only, to be used for
prescribing buprenorphine for opioid use disorder
S. 1851, the Midwives for MOMS Act, proposes to expand midwifery
education programs, can greatly assist in filling critical gaps in care
S. 4079, the Rural Obstetrics Readiness Act, to support
initiatives that enhance OB readiness in hospitals without dedicated OB
units
340B Drug Pricing Program protections including SUPPORT 340B
Act; H.R. 7635 340B PATIENTS Act; H.R. 2534 PROTECT 340B Act; and H.R.
8144 Rural 340B Access Act
Telehealth
COVID-19 Flexibilities
NRHA urges the Committee to consider S. 3967, the Telehealth
Modernization Act and S. 2016, the CONNECT for Health Act in order to
make all Medicare telehealth flexibilities permanent and create payment
parity for RHCs.
The temporary flexibilities introduced during the COVID-19 Public
Health Emergency, including expanded telehealth services and eased
regulatory requirements, have been vital in maintaining healthcare
access during the pandemic. Making these flexibilities permanent would
support a sustained improvement in healthcare accessibility and
efficiency in rural areas. Key flexibilities include: 1) RHCs and
Federally Qualified Health Centers (FQHCs) serving as distant site
providers, 2) audio-only telehealth for rural beneficiaries without
reliable internet access, 3) an expanded list of authorized telehealth
practitioners (including physical therapists, occupational therapists,
speech-language pathologists), 4) removing geographic site
requirements, and 5) allowing the beneficiary's home to serve as an
originating site.
Further, RHCs may not be able to support telehealth services because of
the added costs associated with furnishing them. Rural providers are
less equipped to provide telehealth services without upgrading their
technological infrastructure, and that can come at a significant cost.
Ensuring that RHCs receive payment parity for telehealth services
compared to in-person services will help expand access to beneficiaries
living in rural areas. The overhead for the RHC's brick-and-mortar
clinic exists, in addition to the costs associated with telehealth,
making payment parity a necessity. Without payment parity, it is more
challenging for RHCs to make the necessary transition to telehealth.
Broadband
Supporting policies that continuously improve and expand broadband
infrastructure in rural America is essential for effective telehealth
delivery. Retaining audio-only telehealth services is one way to
address the digital divide, as nearly one in four rural Americans cite
internet access as a major barrier. However, the goal should be to make
broadband accessible for all rural communities to realize the full
potential of telehealth in expanding access to healthcare.
Tele-Behavioral Health
Telehealth has also shown its usefulness in providing behavioral health
care to rural communities. S. 3193, the Telehealth Response for E-
prescribing Addiction Therapy Act allows telehealth, including audio-
only, to be used for prescribing buprenorphine for opioid use disorder
(OUD). This act is pivotal for rural communities where nearly three-
quarters of counties lack a buprenorphine provider. Current
flexibilities for prescribing medications for opioid use disorder
(MOUD) via telehealth expire at the end of 2024, showing the urgent
need for legislative action to ensure continued access.
Rural Provider Stability
Financial and Regulatory Challenges
Rural Hospitals: Rural hospitals operate under the same regulatory
burdens as larger urban hospitals; however, the cost of compliance per
discharge is often higher due to lower patient volumes. This is further
complicated by rising costs in labor, drugs, and supplies, with
hospitals seeing a 17.5% increase in overall expenses from 2019 to
2022, which has not been adequately matched by increases in Medicare or
Medicaid reimbursement. These escalating costs, combined with
inadequate reimbursement rates, have led many rural hospitals to
operate at a loss, with some being forced to close. Half of rural
hospitals across the country are operating on negative margins and 418
hospitals are identified as vulnerable to closure. Legislative relief
from outdated and unnecessarily burdensome regulations and improved
reimbursement could provide rural hospitals with the flexibility needed
to sustain operations and continue serving their communities
effectively.
Rural hospitals are significantly impacted by a predominantly public
payer mix, with Medicare and Medicaid making up a substantial portion
of their patient base. This reliance on public health programs, which
often reimburse at rates lower than the cost of providing care, places
rural hospitals in a precarious financial position, particularly as
they also serve a higher percentage of uninsured patients. In 2020,
rural hospitals faced substantial financial shortfalls, including $5.8
billion in Medicare underpayments and $1.2 billion in Medicaid
underpayments, compounded by $4.6 billion in uncompensated care. These
issues are further exacerbated by Medicare sequester cuts and the
potential implementation of Medicaid Disproportionate Share Hospital
(DSH) cuts.
To address these reimbursement issues, legislative actions such as
adjusting the Medicare wage index policy and ensuring payments reflect
real labor costs are crucial. Current proposals like H.R. 3635/S. 803,
the Save Rural Hospitals Act, aim to enhance reimbursements to more
accurately reflect the actual costs incurred by rural hospitals.
Medicare designations designed to support the unique financial
circumstances of rural hospitals, such as the MDH and LVH designations,
are scheduled to expire at the end of 2024. Supporting S. 1110, the
Rural Hospital Support Act, to make these programs permanent is
essential to provide certainty to hospitals and safeguard their
financial viability moving forward. The Committee should also move
forward with S. 1571, the Rural Hospital Closure Relief Act, to allow a
limited waiver of the 35-mile requirement for CAHs to assist struggling
rural PPS hospitals stay viable.
Another significant reform for rural hospitals would be cost report
modernization. Medicare cost report methods date back to 1965 and have
remained largely unchanged. Cost report allocation is the foundation of
all rural hospital financing. Estimates suggest that with exclusions
Medicare covers 92% of hospital cost, not 101%. Often subsidiary
services are non or low margin yet are critical for population health
initiatives. One meaningful change to how CAHs can be reimbursed is to
allow all costs associated with contracting with physicians to be
included on the cost report. Congress should direct CMS to establish a
working group to address key issues such as waiver or modification of
CAH cost allocation regulations to allow greater integrated community
services and review of cost exclusions that further reduce
reimbursement to hospitals for essential services.
One silver lining of the Public Health Emergency (PHE) was that rural
providers were freed from administrative burdens and outdated
regulations. NRHA calls on the Committee to implement these
flexibilities permanently to make rural health care administration and
delivery more efficient. Of note, Congress should permanently end the
96-hour average length of stay rule for CAHs. Relatedly, NRHA urges
Congress to remove the condition of payment that requires physicians to
certify upon admission that a patient can reasonably expect to be
discharged within 96 hours. Finally, the requirement for beneficiaries
to have a 72-hour qualifying hospital stay before admission to a SNF
should be removed as an outdated barrier to placing beneficiaries in
the appropriate care setting.
Another threat to rural hospital stability is site neutral payment.
Site neutral payment policies will disadvantage rural providers. While
addressing the cost of care for rural residents is critical, it is
essential that rural provider viability is not inadvertently impacted.
Paying off-campus rural providers less than the full outpatient
prospective payment rate contributes to destabilizing rural health care
delivery. Off-campus provider-based departments (PBDs) may be the only
source of care in many rural communities and thus play a critical role
in keeping care local and ensuring that rural patients can receive the
services that they need. Any decline in payments threatens a rural
provider's ability to keep their doors open. Higher costs of PBDs in
rural hospitals may be attributed to the need to spread fixed costs
across a lower volume of services. Additionally, hospitals often
furnish more complex care and must meet more stringent regulatory
requirements than physicians' offices. Hospitals are highly regulated
and the burdens that are associated with compliance should be accounted
for in payment. The site neutral rate does not account for the type of
care furnished nor the resources needed at off-campus PBDs.
Current House site-neutrality proposals would cost rural hospitals $272
million cuts over 10 years. If Congress pursues site neutral policies,
NRHA emphasizes the need to exempt rural hospitals and off-campus PBDs.
Any savings generated from site neutral payment should be reinvested in
the rural health care infrastructure to enact the policy solutions and
legislation presented in our response. Savings could also be redirected
to help rural providers address their patients' social determinants of
health, like transportation or food insecurity. Many safety net
providers that offer transportation or other services for patients
absorb this cost because it is not reimbursable but is a huge benefit
to their patient population. Removing barriers to care and addressing
some social risk factors that impact health will reduce costs in the
long-term because patients are receiving preventive services.
Rural Emergency Hospitals: The Rural Emergency Hospital (REH) model
presents an innovative approach to preserving health care services in
rural areas by offering higher Medicare reimbursement in exchange for
ceasing inpatient care. This designation is one tool in the toolbox for
rural hospitals that may otherwise be facing closure. However,
legislative improvements are needed to make this model more accessible
and financially viable for hospitals that are struggling to maintain
operations. NRHA urges the Committee to consider S. 4322, the Rural
Emergency Hospital Improvement Act. This bill would implement technical
fixes to the REH designation, such as allowing for rehabilitation,
inpatient psychiatric, and obstetric distinct part units; opening
eligibility to hospitals that closed between 2015 and December 27,
2020; creating a waiver program at CMS to allow certain facilities to
convert to REH; allowing CAHs that convert to REH and back to CAH to
retain necessary provider status; and more.
Medicare Advantage: Reforms in Medicare Advantage (MA) are necessary to
prevent further financial strain on rural hospitals. The growth of MA
enrollment is higher in nonmetropolitan counties than in metropolitan
counties. MA penetration in rural areas varies by community, but
overall 45% of rural Medicare beneficiaries are enrolled in an MA plan.
As rural enrollment grows, CAHs and RHCs financial stability are
threatened. CAHs receive 101% of reasonable costs from Traditional
Medicare and RHCs receive their specific all-inclusive rate. Yet MA
plans do not always pay CAHs and RHCs at their Traditional Medicare
rate, undermining their financial base. In fact, about 35% of surveyed
RHCs indicated that they are paid on a fee-for-service basis rather
than on an encounter basis. Ensuring that MA plans reimburse at least
at Traditional Medicare rates and considering rural providers in the
rate-setting processes, are vital steps to prevent the financial
decline of these critical institutions. Federally Qualified Health
Centers (FQHCs), for example, receive a wrap around payment from
Medicare when MA plans do not pay the Traditional Medicare rate.
MA plans also often delay and deny payments, even if they previously
approved the service for the beneficiary and the service was furnished.
Rural providers cannot shoulder delayed or missing payments, especially
as some NRHA members have noted that they are waiting on several
hundred thousand dollars of payments from plans. Addressing these
disparities will help stabilize rural healthcare providers and ensure
that rural residents continue to have access to necessary healthcare
services.
Rural Health Clinics: RHCs play a pivotal role in providing primary
care in rural areas by serving 38.7 million patients per year, or 62%
of all rural Americans. RHCs, like hospitals, also rely heavily upon
government payers with an average of 64% of patients covered by
government payers. Strengthening RHCs through improved funding and
regulatory support can significantly impact the health outcomes of
rural populations.
Low-cost and noncontroversial, S. 198, the RHC Burden Reduction Act is
a commonsense piece of legislation that would make a significant
difference on the day-to-day operations of RHCs by addressing outdated
legislative barriers. This important bill would align RHC physician
supervision requirements with state scope of practice laws governing
physician assistant and nurse practitioner practice, remove outdated
laboratory requirements, allow RHCs to provide an increased amount of
behavioral health services, among other technical tweaks.
Further, NRHA has supported legislative work toward increasing RHC
capacity for quality measure reporting through a voluntary program that
would provide enhanced reimbursement. The House introduced legislation
outlining this idea in the 117th Congress and we urge the Senate to
consider this proposal. Addressing challenges such as the RHC payment
methodology and enhancing support for these clinics can help stabilize
the broader rural healthcare infrastructure, ensuring that primary care
is accessible and sustainable.
Emergency Medical Services: Enhanced federal support for emergency
medical services (EMS) is crucial for rural areas where response times
are typically longer, and operational costs are high due to vast
geographic coverage areas. Rural ambulance response times are more than
double that of urban ambulances and nearly 10% of patients wait over 30
minutes for EMS personnel to arrive. About a third of rural EMS
agencies in the U.S. are in immediate operational jeopardy because they
cannot cover their costs, largely from insufficient Medicaid and
Medicare reimbursements, which pay on average a third of actual EMS
costs. Legislation such as S. 1673/H.R. 1666, the Protecting Access to
Ground Ambulance Medical Services Act, extends increases Medicare
payments for rural ground ambulance services, is essential to sustain
these vital services that often operate at a financial loss.
Transition to Value-Based Care
As health care delivery seeks to move towards value-based care, NRHA is
concerned that rural providers are integrated into new models and
payment opportunities. However, rural providers face challenges related
to quality programs that require reporting on measures not relevant to
the low-volume, rural context. This limits their participation in
innovative payment models, like those administered by CMS' Innovation
Center (CMMI), that could improve patient outcomes and provide
alternative revenue streams. Frequently, fee-for-service reimbursement
does not align with the reality of operating rural facilities,
particularly due to low patient volumes. Value-based care models must
consider the different rural payment mechanisms, particularly for RHCs
and CAHs. Rural providers are poised to gain from value-based care, yet
they struggle to participate or even be included in CMMI models.
Congress charged CMMI with developing and testing new payment and
service delivery models that must achieve cost savings. The decades of
underinvestment in rural health care delivery makes achieving cost
savings extremely difficult. Alternative payment methodologies for
rural providers and higher acuity patient mix can create additional
barriers to model integration. Congress should direct investments to
building out and supporting rural providers in value-based care. The
Committee should grant greater authority to the HHS Secretary, through
CMMI, to develop and implement voluntary alternative rural payment
models. Such models should include a global budget or enhanced cost-
based reimbursement. In addition, NRHA believes that exempting rural
providers from CMMI's cost-savings mandate would alleviate some
barriers to entry in innovative demonstration projects. Congress must
equip CMMI with the authority to waive the cost savings requirement in
order to develop rural-centric models or to allow rural providers to
engage in CMMI models broadly without achieving cost savings at the
outset.
340B Drug Pricing Program
Maintaining and strengthening the 340B Drug Pricing Program is critical
for rural covered entities. This program allows these facilities to
provide discounted drug prices to low-income patients, supporting the
financial health of hospitals that operate on thin margins. 340B is a
lifeline that allows rural safety net providers to keep their doors
open and furnish critical services by stretching scarce federal
resources. Rural hospitals and clinics rely upon 340B savings to help
them keep needed services local for patients. NRHA developed a set of
principles that should guide Congress in any 340B reform to ensure
rural access to the program is protected. NRHA was pleased to see
several of these principles reflected in the Senate 340B Working
Group's discussion draft of the SUPPORT 340B Act.
NRHA urges Congress against any limitations on the number and location
of contract pharmacies with which rural covered entities work and
encourages the Committee to introduce a Senate companion to H.R. 7635,
the 340B PATIENTS Act. Ensuring that rural hospitals continue to
benefit from 340B savings without undue restrictions is vital for
keeping healthcare accessible and affordable in rural communities. NRHA
also supports clear statutory restrictions on pharmaceutical benefit
managers (PBMs) and payers' ability to treat 340B covered entities
differently as outlined in H.R. 2534, the PROTECT 340B Act and
reflected in the 340B Working Group's discussion draft, the SUPPORT
340B Act. These actors have increasingly discriminated against 340B
patients, covered entities, and contract pharmacies. NRHA also asks
that Congress add the new REH provider type to the 340B statute as a
covered entity, as outlined in H.R. 8144, the Rural 340B Access Act.
NRHA members cite 340B eligibility as the top concern when deciding
whether to convert to an REH.
Rural Workforce Support
Graduate Medical Education
Rural areas experience significant disparities in medical professional
availability, notably influenced by the geographic distribution of
Graduate Medical Education (GME) slots. Despite evidence suggesting
that physicians trained in rural settings are more likely to continue
practicing in similar environments, only 2% of residency training
occurs in rural areas. Congress acknowledged the maldistribution of
training opportunities in the Consolidated Appropriations Act (CAA) of
2021, which allocated 10% of the 1,000 new GME slots to rural
hospitals. However, only 5.9% of GME slots went to 5 geographically
rural hospitals during the first round of awards while 42 hospitals
reclassified as rural received 42% slots. Analysis shows only 3% of
reclassified facilities will use slots to train residents for 50% or
greater time in rural areas and 6% for rural training less than 50% of
time, with the remaining 92% doing no formal rural training. Analysis
also shows that the majority of new slots went to residency programs
located in urban health professional shortage areas (HPSAs). In the
second round, two geographically rural hospitals and one urban hospital
with a Rural Track Program received slots. Distribution to reclassified
hospitals is technically following the law;\1\ however, NRHA is
concerned with this allocation of GME slots set aside for rural
training to geographically urban hospitals. Further, it appears the
reclassified hospitals that received slots under the first round of
distribution are not training residents in rural areas. Unfortunately,
this is allowed because of the reference to Sec. 1886(d)(8)(E) in the
legislative text.
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\1\ The CAA, 2021 stated that 10% of slots must go to ``[h]ospitals
that are located in a rural area (as defined in section 1886(d)(2)(D))
or are treated as being located in a rural area pursuant to section
1886(d)(8)(E).'' Hospitals treated as being located in a rural area are
``reclassified'' hospitals, or geographically urban hospitals that
convert to ``rural'' for IPPS payment purposes.
To correct these discrepancies and genuinely support rural healthcare,
the Committee should consider a companion bill to H.R. 8235, the Rural
Physician Workforce Preservation Act. This bill would exclude
reclassified hospitals from receiving the 10% of slots allocated to
rural hospitals unless the hospital reclassified because they are in a
rural Census tract of a metropolitan statistical area or are located in
an area considered rural by state law or regulation. In addition, the
Committee can support rural physician training through S. 230, the
Rural Physician Workforce Production Act which would lift GME caps and
foster a more equitable distribution of medical education resources to
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rural areas.
Another facilitator of rural training would be a minor definitional
change in Rural Track Programs (RTPs). Currently, CMS only finances
RTPs if greater than 50% of the training occurs in rural counties.
While this covers most rural areas, it does not capture all. GME
financing for RTPs should be expanded to programs training greater than
50% of the time in Federal Office of Rural Health Policy (FORHP)
defined rural areas. FORHP defines rural as any non-metropolitan county
plus areas in metropolitan counties with a Rural-Urban Commuting Area
code of 4 or higher. There are currently 353 ACGME-accredited programs
with > 50% training occurring in FORHP rural areas and only 150
programs > 50% occurring in rural counties.
The discrepancies in Indirect Medical Education (IME) payments further
exacerbate the challenges faced by rural hospitals, particularly those
with teaching programs. Sole Community Hospitals (SCHs) and MDHs that
are paid at a hospital-specific rate are unfairly excluded from
receiving IME payments, which limits their capacity to train medical
residents. Equitable IME payment distribution will support the
development of rural training programs, crucial for addressing the
ongoing healthcare provider crisis in these communities.
Last, Section 131 of the CAA, 2021 provided hospitals with very low
direct GME per resident amounts or FTE caps to reset those between
December 27, 2020, and December 26, 2025. However, many rural teaching
hospitals need a longer timeframe to take advantage of this
opportunity. Rural hospitals should be given more time to reach their
full training potential before a new cap is implemented. NRHA suggests
that the Committee consider extending this deadline until 2030 or
allowing a hospital in a geographically rural area with less than 12
FTEs to reset an FTE cap or PRA at any time.
Utilizing All Health Professionals
The maldistribution of physicians in rural areas necessitates
innovative approaches to healthcare delivery and use of nonphysician
practitioners (NPPs). Expanding the scope of practice for nurse
practitioners (NPs), physician assistants (PAs), and other non-
physician practitioners (NPPs) presents a viable solution to alleviate
workforce shortages. Legislation like S. 2418, the Improving Care and
Access to Nurses Act, aims to modernize Medicare policies, removing
barriers that currently restrict the practice capabilities of these
professionals. By allowing greater autonomy and expanding their roles,
rural areas can better utilize the available healthcare workforce to
address gaps in care provision, especially in primary and preventative
care settings.
Nursing Home Staffing
Rural nursing homes are particularly vulnerable to staffing shortages,
which are exacerbated by newly established stringent federal staffing
mandates. The recently finalized CMS staffing standards, though well-
intentioned, do not account for the unique challenges faced by rural
facilities, such as the historic labor shortages and the closure of
facilities in these areas. Over 200,000 more long-term care workers are
needed to meet pre-pandemic staffing levels. On top of record-low
workforce numbers, rural communities saw almost 500 rural nursing homes
close between 2008 and 2018. This trend is not slowing. In fact, the
long-term care landscape is worse in certain predominantly rural states
such as Montana where 16% of the state's nursing homes closed in 2022.
In the same year in Iowa, 13 of 15 nursing homes closures occurred in
rural areas. A lack of post-acute care beds has ripple effects in rural
health care. Patients are unable able to get access to acute care in
their local rural communities because hospitals cannot discharge
patients who no longer require inpatient care but cannot safely return
home due to lack of long-term care facilities. Congress should look to
improve the nursing workforce and home- and community-based services
(HCBS) to lessen the pressure on rural nursing homes and improve
patient outcomes. It is vital that legislation such as the Better Care
Better Jobs Act be reintroduced, providing support for nursing homes
through planning grants, quality measures, and technical assistance
aimed at improving staffing and care quality without imposing
unattainable requirements that could lead to further closures of rural
nursing homes.
Maternal Health
The scarcity of obstetric care in rural hospitals has led to higher
rates of maternal morbidity and mortality. Many rural hospitals have
been forced to close obstetric units due to financial constraints and
workforce shortages, exacerbating the crisis in maternal health. In
2023 alone, 23 hospitals, predominantly in rural areas, announced the
closure of their OB units. This trend is alarming as over half of rural
hospitals are now without an OB unit. The lack of OB provider
availability, with an estimated 58.7% of rural counties lacking an
obstetrician, 81.7% lacking advanced practice midwives, and 56.9%
lacking family physicians who deliver babies, further compounds the
issue. These shortages and closures highlight the urgent need for
policy interventions that ensure the continuity of maternal care in
rural communities.
To address these significant challenges in rural maternal health,
robust federal support is essential. Medicaid reimbursement rates set
by states do not cover the full cost of providing obstetric services.
This may mean particular financial losses for hospitals providing these
services in rural areas, where a higher proportion of births are
covered by Medicaid. Increasing Medicaid reimbursement would help to
keep obstetric services open to serve rural individuals. Proposals like
S. 948, the Healthy Moms and Babies Act are crucial as they aim to
improve maternal and child health by increasing services, supports, and
access to coordinate care and technology in rural areas. Moreover,
legislation such as S. 1851, the Midwives for MOMS Act, which proposes
to expand midwifery education programs, can greatly assist in filling
critical gaps in care. These efforts are particularly vital in rural
areas that rely on midwives and other non-obstetrician practitioners
due to ongoing workforce constraints.
Most pregnancy-related deaths are preventable with proper medical care,
making it imperative for Congress to support initiatives that enhance
OB readiness in hospitals without dedicated OB units. S. 4079, the
Rural Obstetrics Readiness Act, was recently introduced to address this
need. The bill includes grants from the Department of Health and Human
Services (HHS) to expand OB emergency training and equipment in rural
hospitals. Such measures would not only improve the immediate response
capabilities of rural hospitals but also ensure a broader safety net
for expectant mothers in underserved areas.
Thank you for your consideration of these comments. NRHA would be
pleased to serve as a resource as the Committee considers legislation
to protect and improve access to care in rural communities. Please
contact Carrie Cochran-McClain at [email protected] if you have
any questions.
Sincerely,
Alan Morgan
Chief Executive Officer
Links:
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https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6378105/
https://www.aha.org/testimony/2023-05-17-aha-statement-senate-finance-
subcommittee-rural-health-care-access
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Advantage%20Enrollment%20Update%202023.pdf
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Significance-of-the-RHC-Program
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subpart-X/subject-group-ECFRb16e804c561ceb4/section-405.2469
https://www.congress.gov/bill/117th-congress/house-bill/5883/text
https://www.ruralhealthresearch.org/projects/950
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advocacy/white%20paper/nrha-340b-principles.pdf
https://pubmed.ncbi.nlm.nih.gov/37161614/
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based-rhc-fix-letter.pdf
https://jamanetwork.com/journals/jama/fullarticle/2808376
https://www.aamc.org/news/attracting-next-generation-physicians-rural-
medicine
https://www.sap2.org.ar/i2/archivos/2892.pdf#page=3
https://www.federalregister.gov/documents/2024/05/10/2024-08273/
medicare-and-medicaid-programs-minimum-staffing-standards-for-long-
term-care-facilities-and-medicaid
https://www.ruralhealth.us/blogs/2024/4/nrha-statement-on-minimum-
staffing-standards-for-long-term-care-facilities-rule
https://rupri.public-health.uiowa.edu/publications/other/
Nursing%20Home%20
Chartbook.pdf
https://kffhealthnews.org/news/article/wave-of-rural-nursing-home-
closures-grows-amid-staffing-crunch/
https://jamanetwork.com/journals/jama/article-abstract/2815499
https://www.ruralhealthresearch.org/assets/5015-22509/maternal-health-
disparities-recap.pdf
https://www.cdc.gov/media/releases/2022/p0919-pregnancy-related-
deaths.html
______
Niskanen Center
1201 New York Ave., NW, Suite 200B
Washington, DC 20005
https://www.niskanencenter.org
The Bipartisan Immigration Policy That Helps Rural Americans Get
Access to Local Physicians
The Association of American Medical Colleges (AAMC) predicts that there
will be a shortfall of as many as 124,000 physicians by 2034. This is
the product of two diverging trends: Americans are getting older and
their demand for physicians is increasing, while the supply of
physicians is shrinking due to retirements and the slow training of new
physicians.
The worsening physician shortfall will not impact all Americans
equally: underserved communities, such as rural areas, are expected to
be hit the hardest. These populations, who already struggle
disproportionately with healthcare access and wait times, will see
these challenges exacerbated as they have to travel further and wait
longer to see a doctor.
The Conrad 30 waiver program--which incentivizes international medical
graduates (IMGs) to practice in areas with high medical need--can help
address this rural doctor shortage in the U.S. A bipartisan group of
Senators recently introduced legislation to supplement the Conrad 30
waiver program and increase its benefits for Americans in rural and
underserved communities.
Original Conrad 30 Program Overview
Designed by former North Dakota Senator Kent Conrad, the original
Conrad 30 waiver program allows states to offer up to 30 waivers
allowing IMGs studying in the U.S. on a J-1 visa. The waivers let them
skip the 2-year foreign residency requirement after graduation if they
practice in a medically underserved area or with a medically
underserved population.
Since J-1 visas are not dual-intent (that is, they are solely visitor
or exchange visas), recipients cannot apply for an immigrant visa,
adjustment of status, or an H or L visa automatically after studies are
completed. IMGs wishing to remain in the United States must return to
their home countries for at least 2 years before applying for one of
these visas, thus experiencing profound disruptions to their personal
and professional lives. This is something Conrad 30 waivers for rural
U.S. areas with doctor shortages can address.
Doctors granted Conrad-30 waivers can only practice in areas within
federally designated categories, such as Medically Underserved Areas
(MUAs) or Health Professional Shortage Areas (HPSAs). Recipients may
also work specifically with a Medically Underserved Population (MUP).
The program is a needed boost for rural areas of the U.S. experiencing
doctor shortages, as only 1% of doctors in their last year of medical
school say they want to live in communities under 10,000, and 2% want
to live in towns of 25,000 or fewer.
States are also granted significant authority in managing the program,
from approving applicants to determining how they are geographically
distributed. They can also approve up to 10 ``flex'' applicants who do
not work in a federally designated area of need but meet shortage
criteria set by the state and reserve specific slots in their waiver
pool for specialists.
Stringent job protections for Americans are also built into the
program. While states oversee the specific requirements of what an
employer applying for a Conrad 30 waiver needs to demonstrate, they
must generally attest that they have been unsuccessful in recruiting a
U.S. physician for the same position.
Strengths
Over the past 15 years, the program has brought over 15,000 physicians
to areas and patients with significant medical needs. Using a
conservative estimate from a study on patient panel sizes translates to
at least 44 million patients treated by a Conrad 30 doctor since the
start of the program.
IMGs are also disproportionately concentrated in areas with anticipated
shortages. For example, they accounted for over 50% of geriatric
medicine practitioners in 2021. As the share of older Americans
continues to increase, the need for these specialists will also grow
just as their numbers are expected to diminish. IMGs are also highly
represented in essential fields such as kidney diseases, interventional
cardiology, diabetes care, and critical care medicine. The
concentration of likely Conrad 30 recipients in these fields
demonstrates how necessary the program is for these specialties.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
The program also touts promising completion and retention rates in
rural areas with doctor shortages. A 2018 Iowa-based study found that
92% of Conrad 30 recipients in the state met their original 3-year
obligation and 68% were retained beyond their required time frame.
Challenges
Because of the program's decentralized nature, collecting standardized,
regular data on its status and outcomes is challenging, making it
difficult to offer suggested improvements.
One study, however, did report anecdotal doubts that the program
facilitates integration, attributing this to the high-stress
environments of many designated areas, their isolated locations, and
the limited duration of the service period.
Furthermore, the full breadth of issues affecting rural communities and
challenges within the U.S. healthcare system sit well outside the scope
of this one narrow immigration program, and its impact, while
important, remains limited (for more work from Niskanen on healthcare
policy, see the links at the end of this statement).
Conrad State 30 and Physician Access Reauthorization Act and the
DOCTORS Act
The primary vehicle for Conrad 30 reform in recent years is the Conrad
State 30 and Physician Access Reauthorization Act. It was re-introduced
in the 118th Congress with broad bipartisan support, including from
Republicans in rural states like Senator John Thune of South Dakota,
Senator Shelley Moore Capito from West Virginia, and Senator John
Boozman from Arkansas.
The bill--which has also garnered support from several key healthcare
associations, including the American Medical Association, the National
Rural Health Association, and the American Hospital Association--
significantly improves the Conrad 30 program by further addressing
rural doctor shortages and overhauling the program's weaknesses.
First among these is the reauthorization and extension of Conrad 30 for
3 more years, enabling current medical students and potential employers
to better (and more definitively) set long-term plans.
It also increases the number of slots for every state from 30 to 35--
provided that 90 percent of the waivers available to the states
receiving at least five were used in the previous fiscal year. Waiver
spots continue to increase by five under this metric, with the
threshold being increased to 95% once the number reaches 45 waivers.
Increases would be maintained unless waivers granted decrease by 5%.
This update is particularly timely, as the U.S. population had
increased significantly since 2003, when the original 30 spots-per-
state allocation was established. What's more, recent data indicates
that most states used 90% or more of their available waivers,
demonstrating the necessity of this provision.
The bill strengthens worker protections, as organizations seeking to
employ Conrad recipients must disclose the number of working hours,
level of compensation, and other benefits recipients could receive
during their time there. Recipients would also now be able to switch
locations if they are subject to workplace violations, and states that
lose spots to these departures would be able to recapture lost waivers.
The dual intent issue raised by J-1 visas would be addressed by
clarifying that expressing interest in receiving a future Conrad 30
waiver does not make an applicant ineligible. Finally, the bill
mandates a yearly report on Conrad 30 usage to Congress, which will
help remedy the existing data gap on the program.
The Directing Our Country's Transfer Of Residency Slots (DOCTORS) Act
is another bipartisan bill that was introduced by Senators Amy
Klobuchar of Minnesota and Joni Ernst of Iowa. Though the Conrad 30
program allows each state 30 visas annually for qualified IMGs, some
states, like Texas and Indiana, use all the available visas while
others use none. In FY 2023, only 18 states used all available visas,
meaning 395 waivers went unused. The DOCTORS Act then distributes the
unused Conrad visas equally among the states seeking more physicians.
It's a common-sense proposal that holds the promise of addressing our
physician shortages more efficiently using a program already authorized
by Congress.
Conclusion
When operating as intended, the Conrad 30 program helps rural U.S.
areas experiencing doctor shortages and gives many IMGs a chance to
thrive in America, benefiting all parties involved. Patients who may
otherwise have had no recourse but to wait months or years to receive
medical attention gain improved access to local healthcare. Employers
who manage understaffed practices in locations typically unattractive
to recent medical graduates obtain an invaluable new employee pool. And
international medical graduates who would otherwise need to upend their
lives can stay in the United States and are granted increased stability
and security in their personal and professional lives.
The Conrad 30 Reauthorization bill and the DOCTORS Act offer a rare
opportunity for policymakers to take action on something unilaterally
benefiting all parties involved. In passing the bill, policymakers will
strengthen the conditions necessary for the aforementioned outcomes to
come to fruition while signaling that the program's myriad benefits
transcend partisanship.
Links:
https://www.aamc.org/media/54681/download
https://www.census.gov/library/stories/2018/03/graying-america.html
https://www.fsmb.org/siteassets/advocacy/publications/2020-physician-
census.pdf
https://www.uscis.gov/working-in-the-united-states/students-and-
exchange-visitors/conrad-30-waiver-program
https://www.niskanencenter.org/wp-content/uploads/old_uploads/2017/07/
CON
RAD30.pdf
https://www.uscis.gov/working-in-the-united-states/h-1b-specialty-
occupations
https://www.uscis.gov/forms/explore-my-options/l-visas-l-1a-and-l-1b-
for-temporary-workers
https://bhw.hrsa.gov/workforce-shortage-areas/shortage-designation#mups
https://www.npr.org/sections/health-shots/2019/05/21/725118232/the-
struggle-to-hire-and-keep-doctors-in-rural-areas-means-patients-go-
without-c
https://cbkimmigration.com/health-care-workers/conrad-flex-program/
https://www.irvine-legal.com/irvine-articles/2019/10/21/conrad-30-
overview-by-state-j-1-waivers-for-physicians
https://www.ama-assn.org/delivering-care/health-equity/conrad-30-
reauthorization-bill-earns-bipartisan-support
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3438206/#:%7E:text=The%20
average%20time,primary%20care%20model.
https://www.aamc.org/data-reports/workforce/interactive-data/active-
physicians-who-are-international-medical-graduates-imgs-specialty-2019
https://www.ruralhealthinfo.org/toolkits/aging/1/demographics
https://www.chenmed.com/blog/physician-shortage-
geriatrics#:%7E:text=Meanwhile
%2C%20the%20number,in%20the%20future.
http://depts.washington.edu/fammed/rhrc/wp-content/uploads/sites/4/
2016/03/RHRC_FR157_Patterson.pdf
https://www.niskanencenter.org/the-planning-of-u-s-physician-shortages/
https://www.niskanencenter.org/unmatched-repairing-the-u-s-medical-
residency-pipeline/
https://www.congress.gov/bill/118th-congress/senate-bill/665
https://www.klobuchar.senate.gov/public/index.cfm/2023/3/klobuchar-
collins-rosen-tillis-reintroduce-bipartisan-legislation-to-build-
healthcare-workforce-in-rural-and-medically-underserved-areas
https://www.congress.gov/bill/118th-congress/senate-bill/2719
https://www.3rnet.org/Portals/0/Documents/
Conrad%20Historic%20Totals%20-%202001%20to%20Present.pdf?ver=ExFDuNCQZp7
iW5BlSRpw9Q%3d%3d
______
Premier Inc.
444 North Capitol Street, NW, Suite 625
Washington, DC 20001
T 202-393-0860
F 202-393-6499
https://www.premierinc.com/
Premier Inc. appreciates the opportunity to submit a statement for the
record on the Senate Finance Committee hearing titled ``Rural Health
Care: Supporting Lives and Improving Communities'' on May 16, 2024.
Premier applauds the Committee's leadership in this area and strongly
supports efforts to develop innovative policy approaches to expand
access to this critical and vulnerable population. As discussed in more
detail below, Premier highlights opportunities to strengthen the
quality and sustainability of care for patients and providers in rural
and underserved areas, including:
Expanding patient access to home infusion care by revising
Medicare reimbursement policy for these services;
Extending key Medicare telehealth flexibilities and the Medicare
hospital at home program;
Promoting financial stability for rural providers;
Supporting policies that help strengthen the rural healthcare
workforce.
I. BACKGROUND ON PREMIER INC.
Premier is a leading healthcare improvement company, uniting an
alliance of more than 4,350 U.S. hospitals and approximately 300,000
continuum of care providers to transform healthcare. With integrated
data and analytics, collaboratives, supply chain solutions, consulting
and other services, Premier enables better care and outcomes at a lower
cost. Premier's sophisticated technology systems contain robust data
gleaned from nearly half of U.S. hospital discharges, 2.7 billion
hospital outpatient and clinic encounters and 177 million physician
office visits. Premier is a data-driven organization with a 360-degree
view of the supply chain, working with more than 1,460 manufacturers to
source the highest quality and most cost-effective products and
services. Premier plays a critical role in the rapidly evolving
healthcare industry, collaborating with healthcare providers,
manufacturers, distributors, government and other entities to co-
develop long-term innovations that reinvent and improve the way care is
delivered to patients nationwide. Headquartered in Charlotte, North
Carolina, Premier is passionate about transforming American healthcare.
II. IMPROVE PATIENT ACCESS TO HOME INFUSION
Patients served under the Medicare Part B home infusion therapy
services benefit are among the country's most vulnerable and often
suffer from advanced chronic diseases, such as congestive heart
failure, cancer and primary immune deficiency. For decades, home
infusion has offered these patients the ability to receive safe and
effective care in their homes, which improves their quality of life,
minimizes exposure to infectious diseases and provides a more cost-
effective option for patients to receive critical medications.
These services are particularly valuable to patients in rural areas who
otherwise could be forced to travel significant distance to access
care. Unfortunately, the Centers for Medicare & Medicaid Services'
(CMS') interpretation of the Medicare home infusion benefit has led to
access gaps, which are most prevalent in many rural and underserved
areas, as revealed in CMS' own reporting on the program, which shows no
home infusion services provided to beneficiaries in Arkansas, Montana,
North Dakota, South Carolina, Vermont, and Wyoming.
Premier urges Congress to pass The Preserving Patient Access to Home
Infusion Act (S.1976/H.R.4104) to promote patient access to home
infusion care by aligning Medicare reimbursement policy with the
successful model employed by commercial plans.
III. EXTEND ACCESS TO TELEHEALTH
Telehealth was a critical tool during the COVID-19 public health
emergency, allowing providers to continue to furnish much-needed
services to patients from the safety of their homes. The flexibilities
that CMS granted around Medicare telehealth served to highlight that
many services can be effectively and efficiently furnished remotely.
Congress recognized the value in easing barriers to virtual care and
extended several key telehealth flexibilities in the Consolidated
Appropriations Act (CAA) of 2023 through the end of calendar year (CY)
2024, as advocated by Premier.
Today, telehealth continues to serve as a means for providers to expand
care to many patients who previously had access barriers, particularly
in rural and underserved communities. Congressional action, however, is
needed to preserve this important care tool, which is especially
critical for those using telehealth to reach specialists at longer
distances, for access to mental and behavioral health practitioners and
those receiving ongoing remote care for chronic conditions. Premier
urges Congress to further extend the telehealth flexibilities as
policymakers continue to evaluate the impact of these policies on
patient care.
As Congress considers extending telehealth flexibilities it is critical
that it also extends use of audio-only technology. Nearly a quarter of
beneficiaries that received a telemedicine service during the COVID-19
pandemic did so by using audio-only telephone technology in both 2020
and 2021. Accessing video technology can be particularly challenging
and creates barriers for beneficiaries who are low-income, elderly or
who live in rural areas where the broadband infrastructure cannot
support streaming video. The COVID-19 public health emergency (PHE) has
highlighted that many services can be effectively delivered as audio-
only and do not require a video-connection. Premier urges Congress to
allow for use of audio-only technology for services where it would be
clinically appropriate. For example, many patients have benefited from
receiving virtual behavioral health services through interactive audio-
only technology. CMS could continue to differentiate which services are
eligible to be furnished via audio-only as compared to those that
require both audio and video technology. CMS should provide
stakeholders with the opportunity to weigh in on these lists as part of
annual rulemaking.
IV. EXTEND HOSPITAL AT HOME PROGRAM
In November 2020 in response to the COVID-19 pandemic, CMS promulgated
the Acute Hospital Care at Home (AHCAH) waiver, which allowed patients
to receive certain acute care services from the comfort and safety of
their homes. With these flexibilities as the springboard, more than 300
hospitals across 37 states have embraced the ``hospital at home''
concept and have tailored their programs to meet specific patient and
organizational objectives. The AHCAH program enables providers to
effectively monitor and care for patients as they recover in the
comfort of their own homes. This can include remote monitoring
capabilities, in-home provider visits, telehealth, medication
management and many other care strategies. This new avenue of care has
freed up hospital capacity, offered a safe and effective method to care
for COVID-19 patients, and reduced avoidable emergency department
visits.
We appreciate efforts by Congress to extend these COVID-19
flexibilities through CY 2024 while CMS continues to evaluate the
program. Preliminary studies from both CMS and external researchers
have found that Medicare patients treated under the CMS hospital at
home initiative had low rates of mortality and few hospital
readmissions. Premier urges lawmakers to further extend the Medicare
hospital at home program beyond 2024 as it continues to evaluate how
these flexibilities can best support patient access to high quality
care in their homes. As part of this, Congress should examine
alternatives and refinements to the current hospital at home waiver to
permit further adoption in rural and underserved areas.
V. ENSURE ADEQUATE PAYMENT TO RURAL PROVIDERS
Health systems and hospitals continue to operate under enormous
financial challenges stemming from a combination of increased labor
costs, record inflation and lagging reimbursement rates that do not
account for these unprecedented financial challenges. The impact of
this problem falls disproportionately on facilities in rural and
underserved communities, as providers are increasingly sparse in these
areas and therefore require a premium to recruit. Premier has expressed
significant concerns to CMS that the methodology used to determine
annual hospital payment updates does not adequately capture the true
costs hospitals have faced over the last few years, especially as it
relates to labor. A PINC AITM analysis found that labor
costs have increased by more than 15 percent since the start of FY 2020
through the first half of FY 2023 and do not show signs of returning to
a lower level.
Premier urges Congress to develop legislation that requires CMS to
reevaluate the data sources it uses for calculating labor costs and
adopt new or supplemental data sources that more accurately reflect the
cost of labor, taking into account geographic disparities in rural and
underserved areas, such as more real time data from the provider
community inclusive of contract labor. This would provide a more
accurate, blended and aggregated payment adjustment to all hospitals
across the nation based upon their true labor costs. Doing this would
also allow payments to ebb and flow as needed to account for any
readjustments that occur to labor costs in the future.
Additionally, Premier recommends Congress develop long-term solutions
to stabilize Medicare payments, including eliminating the Medicare
sequestration cuts, which have a significant impact on providers in
rural and underserved areas. Congress should also consider how any
provider cuts currently being contemplated may inequitably impact rural
providers. By establishing policies that create stable, predictable
payments for Medicare providers, Congress will help ensure stability
for providers in rural and underserved areas and address unjustified
geographic payment disparities.
Finally, Premier urges Congress to take additional actions to promote
provider stability and strengthen access to care for patients in rural
areas by:
Reforming Rural Emergency Hospitals (REH) policies. Congress
established the REH provider designation as an option for rural
communities to maintain access to emergency and certain outpatient
services in light of potential hospital closures. To date, only 21
hospitals have converted to REH status. While many more hospitals may
benefit from this policy, there are statutory restrictions that make
the provider type untenable for many rural hospitals. Premier
encourages Congress to work with stakeholders to address statutory
barriers that have limited uptake of the REH provider type to ensure
this new provider type is a viable option for rural hospitals and their
communities.
Extending Medicare-Dependent Hospital (MDH) program and Low-
Volume Hospital (LVH) payment adjustment. Congress established the MDH
program in the late 1980s to support small rural hospitals where
Medicare patients made up a significant portion of their inpatient
population. The LVH program, which was established in 2005, provides
higher Medicare payments to qualifying rural hospitals to help offset
the higher costs associated as a result of low inpatient volume.
Congress has modified the LVH payment methodology several times in
order to allow more hospitals to qualify. Both programs have been
critical to ensuring the sustainability of rural hospitals and access
to care in rural communities. However, both the MDH program and
adjustments to the LVH program expire at the end of CY 2024. Premier
urges Congress to stabilize rural hospital funding by extending both
the MDH program and LVH payment adjustment for multiple years.
Extend support for Community Health Centers (CHC). CHCs increase
access to crucial primary care by reducing barriers related to cost,
lack of insurance, distance and language for more than 30 million
patients nationwide, many in rural and underserved communities. Through
the timely delivery of preventative care, CHCs improve the well-being
of countless Americans and reduce government spending on healthcare. In
addition, CHCs serve on the front lines in our battle against addiction
and mental health and are a lifeline for many patients and their
communities. The CHC Fund (CHCF) accounts for nearly 70 percent of
health center funding and authorization for the program is set to
expire at the end of CY 2024. CHC funding is vital to communities
nationwide, over half of which are rural. Further, this funding
supports CHC data modernization efforts and preparation for future
public health emergencies. Funding for CHCs has historically always
received bipartisan support in Congress. Premier urges Congress to work
together to provide stable and strong multi-year funding for CHCs which
support critical care in underserved areas and play a vital role in
America's rural communities.
Delay cuts to Medicaid Disproportionate Share Hospital (DSH)
Program. The Medicaid DSH program was created to help offset
uncompensated care costs for hospitals that provide care to large
numbers of Medicaid and uninsured patients. These hospitals provide
critical services and are economic and healthcare anchors in their
communities. More than 2,500 hospitals nationwide receive DSH payments
which help keep many hospitals financially viable and able to provide
care to vulnerable individuals. The Affordable Care Act (ACA) required
reductions to the Medicaid DSH program over time, beginning in FY 2014,
under the assumption that the law would increase health insurance
coverage and therefore hospitals would be providing less uncompensated
care. Unfortunately, the coverage levels anticipated under the ACA have
not been fully realized and therefore the levels of uncompensated care
provided by DSH hospitals to uninsured and underinsured remains at pre-
ACA levels.
Premier appreciates recent efforts by Congress to delay the onset
of these cuts until January 1, 2025. Premier urges Congress to act
before the end of the year to prevent the pending Medicaid DSH cuts
once again for at least 2 years and protect access to care for our
nation's most vulnerable patients.
Reauthorize the Substance Use Disorder Prevention that Promotes
Opioid Recovery and Treatment for Patients and Communities (SUPPORT)
Act: The SUPPORT Act, which passed in 2018 with robust bipartisan
support, has been instrumental in helping our nation address the opioid
epidemic through programs and policies that impact treatment,
prevention and recovery. Unfortunately, the SUPPORT Act authorization
lapsed as of Sept. 30, 2023. The ongoing opioid epidemic continues to
overwhelm hospitals with an estimated 66 million emergency department
visits and 760,000 inpatient admissions each year. Premier urges
Congress to reauthorize the SUPPORT Act to reduce barriers to receiving
and delivering care for substance use disorders by improving payment
policies (including those that promote telehealth services), reducing
unnecessary regulatory and administrative burden for providers and
strengthening the behavioral healthcare workforce.
VI. STRENGTHEN RURAL HEALTHCARE WORKFORCE
The healthcare workforce is currently experiencing severe shortages
because of unprecedented pressures exacerbated by the pandemic, pushing
our healthcare system to its limits. Projections by the Association of
American Medical Colleges (AAMC) show that physician demand will grow
faster than supply leading to a projected total physician shortage of
up to 124,000 physicians by 2034. These shortages will have real impact
on patients, particularly those living in rural and underserved
communities. In addition to the physician workforce, we must also take
steps to bolster the ranks of non-physician clinical roles, including
nursing, but also other vital roles such as pharmacists, occupational
therapists, respiratory therapists and more. Premier believes
addressing workforce shortages requires a multi-pronged approach and
urges Congress to take the following actions:
Extending workforce training programs. The Teaching Health
Centers Graduate Medical Education (THCGME) program, the Children's
Hospital Graduate Medical Education Program (CHGME) and the National
Health Service Corps (NHSC) program are not only fundamental for
tackling the healthcare labor shortage, but they provide essential and
comprehensive services for rural and tribal communities as well as
children nationwide. These programs expand our ability to deliver
primary care across the country and are fundamental to tackling the
healthcare labor shortage. Premier appreciates recent legislation to
extend many of these programs through CY 2024. Premier urges Congress
to continue its record of bipartisan support for workforce training
programs and provide stable multi-year funding for these programs.
Congress should also consider support for ``earn while you learn''
programs that support the growth and development of healthcare workers
while employed in a healthcare facility.
Additionally, under the Conrad 30 program, each state is allocated
30 waivers that exempt J-1 physicians from the requirement to return to
their country of origin in exchange for three years of service in an
underserved community. Premier supports The Conrad State 30 and
Physician Access Reauthorization Act (S. 665/H.R. 4942). While a
temporary extension of the program's authorization until Sept. 30, 2024
was recently enacted, Premier urges Congress to further extend this
program which has helped Americans in rural and underserved areas
receive medical care.
Investing in residency training. To help grow a sustainable
physician workforce to meet patient needs, increased Medicare support
for graduate medical education (GME, or residency training) is needed.
Premier urges Congress to take additional action to increase Medicare-
supported GME slots by passing the bipartisan Resident Physician
Shortage Reduction Act of 2023 (S. 1302/H.R. 2389). This legislation
which would gradually raise the number of Medicare-supported GME
positions by 2,000 per year for 7 years, for a total of 14,000 new
positions. These new GME positions would target teaching hospitals with
varied needs, including hospitals in rural areas and hospitals serving
patients from federally-designated health professional shortage areas.
Boosting non-physician pipeline. An issue Premier frequently
hears with respect to nursing shortages is that the pool of willing
candidates exceeds the number of available training slots in schools of
nursing, at least partly due to limited number of available training
faculty. Premier encourages Congress to consider ways to increase
training facility capacity, including examining whether all educators
in such programs should require an advanced degree or if there are
opportunities for flexible standards that might create additional
training capacity if some educators are permitted to have a bachelor's
degree only for example. Premier also recommends that Congress seek
opportunities to provide support to grant programs that expand
vocational programs to help train advanced practice providers, such as
nurse practitioners, and other clinical roles that do not require 4-
year degrees, such as home health aides; nursing assistants; or
technicians for pharmacy, radiology and laboratory. Premier
additionally encourages Congress to support approaches and programs
that connect high school students to health careers by enhancing
recruitment, education, training and mentorship opportunities.
Inclusive education and training experiences expose students and
providers to backgrounds and perspectives other than their own and
heighten cultural awareness in healthcare, resulting in benefits for
all patients and providers. Studies also show that underrepresented
students are more likely to serve patients from those communities.
Reforming loan forgiveness programs. Loan forgiveness programs
should be considered to incent new talent to join the field. However,
in many cases healthcare workers opt to not accept loan forgiveness
funds because they are accounted for as income and can have a
detrimental impact on an individual's finances if pushed into a higher
tax bracket. Similarly, healthcare workers are often hesitant to accept
employer assistance funds as they can also be counted as income and
force the worker into a ``benefit cliff.'' Therefore, Premier urges
Congress to ensure that the tax implications of loan forgiveness
programs do not act as inadvertent disincentives to individuals
participating.
VII. CONCLUSION
In closing, Premier appreciates the opportunity to submit these
comments in response to the Finance Committee's hearing. Please
consider Premier and our significant cohort of rural providers a
resource as you continue this important work. If you have any questions
regarding our comments or need more information, please contact Melissa
Medeiros, Senior Director of Policy at melissa--medeiros@
premierinc.com.
Links:
https://www.cms.gov/files/document/hit-monitoring-report-feb-2023.pdf
https://www.congress.gov/bill/118th-congress/senate-bill/
1976?q=%7B%22search%
22%3A%5B%22s.+1976%22%5D%7D&s=5&r=1
https://aspe.hhs.gov/sites/default/files/documents/
cb83f6f25c25c3a3529807f23cd2
327d/medicare-telehealth-updated-trends-report.pdf
https://jamanetwork.com/journals/jama-health-forum/fullarticle/2811346
https://www.acpjournals.org/doi/10.7326/M23-2264
https://premierinc.com/downloads/Premier-Comments_-IPPS-FY-2024-
Proposed-Rule_FINAL.pdf
https://premierinc.com/newsroom/blog/pinc-ai-data-cms-data-
underestimates-hospital-labor-spending
https://www.aamc.org/media/54681/download
https://www.congress.gov/bill/118th-congress/senate-bill/
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22search%22%3A%22s.+665%22%7D
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Rural Hospital Coalition
500 North Capitol St., NE
Washington, DC 20001
(202) 756-8334
https://www.larhc.org
Statement of Nancy Taylor, Counsel
Chair Wyden, Ranking Member Crapo, and members of the Senate Finance
Committee, on behalf of the Rural Hospital Coalition, which represents
about 300 rural hospitals across 30 states, we want to express our
sincere appreciation of your continued commitment to ensure rural
hospitals receive adequate payments and services remain available to
patients in rural communities. We further appreciate your continued
support for the Low-Volume Hospital (LVH) Program and the Medicare
Dependent Hospital (MDH) Program and encourage Congress to support
these programs going forward.
The LVH Program and the MDH Program are two rural hospital add-on
payments that receive Medicare reimbursement, which allows for rural
hospitals to continue providing crucial care to Medicare beneficiaries
in the community. To obtain the Low-Volume Hospital Payment Adjustment
of 25%; the hospital must have less than 200 total discharges and be
located more than 25 road miles from the nearest IPPS hospital. The
Medicare Dependent Hospital, a hospital must be in a rural area and be
designated as MDH in prior years.
Rural hospitals are facing enormous financial challenges. Between the
years 2005 and 2022, 186 rural hospitals closed, and according to the
American Hospital Association (AHA), an estimated one in four rural
hospitals remain at risk of closing.\1\ These financial challenges are
driven primarily by lower patient volumes and the markedly lower
payment rate for rural hospitals by the government and private
insurance companies.
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\1\ Rural Health Research Gateway, June 2023.
Furthermore, rural hospitals are often the largest employers in their
communities and when rural hospitals suffer, so too does the community
at large. Between 1990 and 2020, rural counties that experienced
hospital closures, or a facility no longer provided in-patient care,
the county suffered higher unemployment rates, lower per capita income,
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and lower median household incomes.
We thank the Chair, Ranking Member, and other members of the Committee
for their efforts over many years in extending these programs. While
the Rural Hospital Coalition supports permanent establishment of these
programs that help hospitals who meet the requirements, and we also
support the extension of these essential programs in rural communities.
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