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26–251 2017

21st CENTURY MEDICINE: HOW TELEHEALTH CAN 

HELP RURAL COMMUNITIES 

HEARING 

BEFORE THE

SUBCOMMITTEES ON AGRICULTURE, ENERGY, AND TRADE AND HEALTH AND 

TECHNOLOGY 

OF THE

COMMITTEE ON SMALL BUSINESS 

UNITED STATES 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FIFTEENTH CONGRESS 

FIRST SESSION 

HEARING HELD 

JULY 20, 2017 

Small Business Committee Document Number 115–031 

Available via the GPO Website: www.fdsys.gov 

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Congress.#13
(II) 

HOUSE COMMITTEE ON SMALL BUSINESS 

STEVE CHABOT, Ohio, Chairman 

STEVE KING, Iowa 

BLAINE LUETKEMEYER, Missouri 

DAVE BRAT, Virginia 

AUMUA AMATA COLEMAN RADEWAGEN, American Samoa 

STEVE KNIGHT, California 

TRENT KELLY, Mississippi 

ROD BLUM, Iowa 

JAMES COMER, Kentucky 

JENNIFFER GONZA ́ LEZ-COLO ́ N, Puerto Rico 

DON BACON, Nebraska 

BRIAN FITZPATRICK, Pennsylvania 

ROGER MARSHALL, Kansas 

RALPH NORMAN, South Carolina 

NYDIA VELA ́ ZQUEZ, New York, Ranking Member 

DWIGHT EVANS, Pennsylvania 

STEPHANIE MURPHY, Florida 

AL LAWSON, JR., Florida 

YVETTE CLARK, New York 

JUDY CHU, California 

ALMA ADAMS, North Carolina 

ADRIANO ESPAILLAT, New York 

BRAD SCHNEIDER, Illinois 

VACANT 

KEVIN FITZPATRICK, Majority Staff Director 

JAN OLIVER, Majority Deputy Staff Director and Chief Counsel 

ADAM MINEHARDT, Staff Director 

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(III) 

C O N T E N T S 

OPENING STATEMENTS 

Page 

Hon. Rod Blum ......................................................................................................... 1 

Hon. Brad Schneider ............................................................................................... 2 

Hon. Al Lawson ........................................................................................................ 3 

Hon. Trent Kelly ...................................................................................................... 4 

WITNESSES 

Ms. A. Nicole Clowers, Managing Director, Health Care Team, United States 

Government Accountability Office, Washington, DC ........................................ 5 

Ms. Barb Johnston, Chief Executive Officer and Co-Founder, HealthLinkNow, 

Sacramento, CA .................................................................................................... 6 

Mr. Michael Adcock, Administrator, Center for Telehealth, University of Mississippi Medical Center, Jackson, MS ................................................................ 8 

David Schmitz, M.D., President, National Rural Health Association, Washington, DC ............................................................................................................. 10 

APPENDIX 

Prepared Statements: 

Ms. A. Nicole Clowers, Managing Director, Health Care Team, United 

States Government Accountability Office, Washington, DC ..................... 32 

Ms. Barb Johnston, Chief Executive Officer and Co-Founder, 

HealthLinkNow, Sacramento, CA ............................................................... 43 

Mr. Michael Adcock, Administrator, Center for Telehealth, University 

of Mississippi Medical Center, Jackson, MS ............................................... 49 

David Schmitz, M.D., President, National Rural Health Association, 

Washington, DC ............................................................................................ 53 

Questions for the Record: 

None. 

Answers for the Record: 

None. 

Additional Material for the Record: 

CCA - Competitive Carriers Association ........................................................ 62 

GAO Report ....................................................................................................... 65 

The National Congress of American Indians and The National Indian 

Health Board ................................................................................................. 137 

SBREP-219A with DISTILLER

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(1) 

21st CENTURY MEDICINE: HOW TELEHEALTH 

CAN HELP RURAL COMMUNITIES 

THURSDAY, JULY 20, 2017 

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON SMALL BUSINESS, 

SUBCOMMITTEE ON AGRICULTURE, ENERGY AND TRADE, 

JOINT WITH THE

SUBCOMMITTEE ON HEALTH AND TECHNOLOGY, 

Washington, DC. 

The Subcommittees met, pursuant to call, at 10:00 a.m., in Room 

2360, Rayburn House Office Building, Hon. Rod Blum [chairman of 

the Subcommittee] presiding. 

Present: Representatives Chabot, Luetkemeyer, Radewagen, 

Kelly, Blum, Comer, Gonza ́lez-Colo ́n, Bacon, Fitzpatrick, Marshall, 

Lawson, Espaillat, and Schneider. 

Chairman BLUM. Good morning. I call this hearing to order. The 

Subcommittees are here today to examine how the expansion of 

telehealth services may benefit small businesses and rural communities. Telehealth or telemedicine refers to the use of online video 

or telephone communication to deliver healthcare services that are 

to replace or supplement existing healthcare services. 

Telehealth is becoming a vital component of medical treatment, 

particularly in areas where there are provider shortages, such as 

rural areas where I am from, or for conditions that require regular 

monitoring. 

While 20 percent of Americans live in rural areas, only 9 percent 

of physicians practice there. Rural communities often struggle with 

provider shortages, requiring patients and their families to travel 

long distances to access medical care. 

Telehealth may allow rural physicians to expand their patient 

base and to keep dollars in the community, benefitting other local 

small businesses, such as retail establishments and restaurants, 

contributing to a sense of community that American small towns 

pride themselves on. Expanding use of telehealth services may 

even attract physicians to open or relocate practices in rural areas 

without worrying about having enough local patients to stay in 

business. Those of us from rural areas would not want to live anywhere else, yet new physicians often have concerns about opening 

a viable practice in a rural community. 

Our witnesses today will discuss the current use of telehealth 

and the barriers that are providing wider use. I want to thank all 

of them for being here today. We look forward to hearing your testimony. And I now yield to the ranking member of the SubSBREP-219A with DISTILLER

2 

committee on Agriculture, Energy, and Trade, Mr. Schneider, right 

on cue, for his opening statement. 

Mr. SCHNEIDER. Thank you, and I am sorry I am late. Elevators. Anyway, I want to thank the panelists for being here and 

taking the time to share your thoughts with us about healthcare 

coverage for rural America. 

Today, rural populations are more likely to be poorer, sicker, 

older, and have higher rates of uninsured compared with urban 

populations. Exacerbating these issues, rural Americans experience 

many difficulties in accessing healthcare services which leads to 

higher morbidity and mortality rates compared to those of their 

urban counterparts. 

Among the primary challenges rural communities face is a lack 

of adequate insurance coverage or even getting coverage at all. 

Nearly one-quarter of all adults in rural communities are uninsured, and nearly 60 percent of the rural uninsured are low-income 

families. 

Rural populations are less likely to have employer-sponsored 

health insurance. Consequently, Medicaid is a critical lifeline for 

rural and underserved communities. This is why efforts to repeal 

the progress the Affordable Care Act has made to provide coverage 

to underserved and rural communities is so misguided. 

In addition, there is a shortage of doctors and hospitals in rural 

areas, and institutional barriers can make providing care in these 

areas especially challenging. These challenges not only result in 

poor health outcomes for people in rural communities but have significant implications for the local economy. 

I look forward to hearing testimony today about policies that can 

increase the number of physicians in underserved communities and 

leverage technological innovation to improve health access and 

quality. Policies that increase insurance coverage not only benefit 

patients but also create jobs in the healthcare sector, a sector that 

is overwhelmingly comprised of small businesses. 

In fact, it is estimated that, since 2012, 50,000 jobs were added 

to the healthcare sector as a direct result of the expansion of coverage under the Affordable Care Act. Despite this growth, there 

still remains a significant provider shortage in rural areas. Even 

with insurance coverage, many patients in rural areas struggle to 

find care, especially when it comes time to visit a specialist. 

The fact is made abundantly clear by the ongoing opioid epidemic 

currently plaguing our Nation. It’s estimated that as many as 3 

million people in the U.S. are suffering from opioid addiction related to prescription drugs and heroin. As opioid-related deaths 

have gone up across the Nation, the largest increases are reported 

in heavily rural States. Our constituents and their families need 

help, but they often have no place to go. For example, 13 percent 

of rural communities have no behavioral health providers. Telehealth has the potential to bring high quality behavioral health 

services to these suffering communities. 

Indeed, studies have shown that video telehealth users have satisfaction levels and outcomes similar to those clients receiving inperson therapy. Although it is still in its early stages, telehealth 

is expanding at a rapid rate, and has potential to dramatically improve access to quality care in a number of areas. Telehealth also 

SBREP-219A with DISTILLER

3 

has the potential to draw more doctors into practice in rural settings, who would otherwise feel isolated, and can be used to connect specialists with community providers, allowing practitioners to 

join a virtual community where they can receive mentoring and 

grow professionally. 

Improving access to care in rural areas also benefits the local 

small business economy. There are over 1,500 rural hospitals nationwide that support nearly 2 million jobs. Every dollar spent by 

a rural hospital produces $2.29 of economic activities. When patients can receive care in their community, they do not need to 

travel to urban centers. They are able to keep their dollars within 

their own community and help to drive the success of local small 

firms. I look forward to hearing testimony today about how we can 

advance policies and leverage telehealth to improve access to quality healthcare for rural and underserved communities. 

With that, I say thank you, and I yield back. 

Chairman BLUM. Thank you, Mr. Schneider. 

I would now like to yield to the ranking member of the Subcommittee on Health and Technology, Mr. Lawson, for his opening 

statement. 

Mr. LAWSON. Thank you, Mr. Chairman, and welcome to the 

Committee. 

Nineteen percent of the U.S. population live in rural areas, as 

most of you know, yet only about 9 or 10 percent of physicians 

practice in rural areas. Rural populations have fewer hospitals and 

healthcare providers, particularly specialists, than any other urban 

counterparts. And patients often must travel long distances, as we 

heard earlier, to access care while primary care providers struggle 

to coordinate care with specialists. 

This not only has implications for doctors, clinics, and small hospitals, but for the local small business economy. However, innovations in technology are helping to alleviate the strain on small providers. Today’s hearing will offer an opportunity to examine ways 

that we can improve access to healthcare in rural areas. 

Telehealth has the potential to advance healthcare quality by reducing costs. It can save patients time and money in traveling to 

see their doctors while also allowing small practices to broaden 

their scope. This also indirectly benefits local small business economy by keeping dollars in the community to make rural areas more 

attractive. 

I myself grew up in a rural area. And in recent years, innovations have made telehealth technology more accessible to rural providers than ever before. However, obstacles to its adoption remain. 

Some barriers are easy to overcome, such as educating doctors and 

patients about its utility. Other obstacles, such as a lack of 

broadband connectivity, are more challenging. 

I am pleased this hearing will provide the opportunity for us to 

examine not only the barriers to health faced by rural communities 

but how innovations in technology can improve them. I hope that 

this hearing will help us identify ways we can encourage greater 

adoption of telehealth and how improved access to care benefits 

small business economy. I want to thank our witnesses again who 

traveled here today for both their participation and insight into 

this important topic. 

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4 

With that, Mr. Chairman, I yield back. 

Chairman BLUM. Thank you, Mr. Lawson. 

If Committee members have an opening statement prepared, I 

ask that it be submitted for the record. 

I would like to take a moment to explain the timing lights to our 

panelists. You will each have 5 minutes to deliver your testimony. 

The light will start out as green. When you have 1 minute remaining, the light will turn yellow. And, finally, at the end of your 5 

minutes, it will turn red, and we ask that you try to adhere to that 

time limit to the extent possible. 

I would now like to formally introduce our witnesses today. Our 

first witness is Ms. Nikki Clowers, the managing director of the 

healthcare team at the U.S. Government Accountability Office, or 

better known as GAO. The healthcare team at GAO recently released a report entitled ‘‘Telehealth and Remote Patient Monitoring 

Use in Medicare and Selected Federal Programs’’ and surveyed a 

wide variety of stakeholders on the state of telehealth use in Federal health programs. Thank you for being here with us today. 

Our next witness is Ms. Barb Johnston, the chief executive officer and cofounder of HealthLinkNow in Sacramento, California. 

Ms. Johnston’s company helps mental health providers incorporate 

telehealth services into their practices. Additionally, through a 

Centers for Medicare and Medicaid Services grant, her company integrated telehealth services into more than 80 primary care clinics 

in three rural States, Montana, Wyoming, and Washington. We appreciate your testimony and being here today. 

And I now yield to Mr. Kelly, a member of the full Committee, 

for the introduction of our next witness. 

Mr. KELLY. Thank you, Mr. Chairman. 

I would also like to just acknowledge that the chairman of the 

full Committee, Chairman Chabot, has joined us, and we thank 

him for being here on this important event. 

Thank you. I am proud to introduce Mr. Michael Adcock, the administrator of the Center for Telehealth at the University of Mississippi Medical Center, or UMMC. As executive director for 

UMMC Center for Telehealth, Michael is on the front lines of combating the severe doctor shortage that Mississippi faces. The 

UMCC Center for Telehealth is, in my opinion, the best in the 

country and leverages location within Mississippi’s only teaching 

hospital to deliver high-quality care to rural patients that often 

lack access. 

Mr. Adcock, I am excited to have a great Mississippian here 

today, and I look forward to hearing your opening statement. 

Thank you, Mr. Chairman. I yield back. 

Chairman BLUM. Thank you, Mr. Kelly. 

I now yield to our ranking member, Mr. Schneider, for the introduction of our next witness. 

Mr. SCHNEIDER. I am going the yield to my colleague Mr. 

Lawson. 

Mr. LAWSON. Thank you, sir. Okay. I have the pleasure of introducing Dr. Schmitz, president of the National Rural Health Association, professor and chair in the Department of Family and 

Community Medicine at University of North Dakota School of Medicine and Health Sciences. 

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5 

Dr. Schmitz has spent nearly 20 years in rural practice and 

teaching residents and students in the area of medical education, 

rural health, and workforce research. He is an active in both the 

American Academy of Family Physicians, serving on the Commission on Quality and Practice, the Global Association of Family Physicians serving as the North American representative to the executive of the Group of Rural Practices. I welcome Dr. Schmitz. 

Chairman BLUM. Thank you, Mr. Lawson. 

I would like to now recognize Ms. Clowers for her 5-minute testimony. 

STATEMENTS OF A. NICOLE CLOWERS, MANAGING DIRECTOR, 

HEALTH CARE TEAM, UNITED STATES GOVERNMENT ACCOUNTABILITY OFFICE, WASHINGTON, D.C.; BARB JOHNSTON, CHIEF EXECUTIVE OFFICER AND COFOUNDER, 

HEALTHLINKNOW, SACRAMENTO, CALIFORNIA; MICHAEL 

ADCOCK, ADMINISTRATOR, CENTER FOR TELEHEALTH, UNIVERSITY OF MISSISSIPPI MEDICAL CENTER, JACKSON, MISSISSIPPI; AND DAVID SCHMITZ, M.D., PRESIDENT, NATIONAL 

RURAL HEALTH ASSOCIATION, WASHINGTON, D.C. 

STATEMENT OF A. NICOLE CLOWERS 

Ms. CLOWERS. Chairman Blum, Ranking Members Schneider 

and Lawson, Chairman Chabot, and members of the Subcommittee, 

thank you for inviting me here today to discuss our April 2017 report on telehealth. 

Access to healthcare services can be challenging for some people, 

such as those who live in remote areas. Telehealth can provide an 

alternative to healthcare provided in person or at a doctor’s office— 

for example, by providing clinical care remotely through two-way 

video. 

In my comments today, I will cover three topics from our April 

report. One, the extent to which telehealth is used in Medicare and 

Medicaid; two, factors that affect the use of telehealth in Medicare; 

and, three, the different payment and delivery models that could 

affect the potential use of telehealth in Medicare. 

First, we found that Medicare providers used telehealth services 

for a small proportion of beneficiaries and relatively few services. 

For example, an analysis of Medicare claims data by the Medicare 

Payment Advisory Commission, or MedPAC, shows that less than 

1 percent of all Medicare Part B fee-for-service beneficiaries 

accessed services using telehealth in 2014. 

According to MedPAC, beneficiaries using telehealth averaged 

about three telehealth visits in 2014, and Medicare spent about $14 

million in total in telehealth services in that year. The most common telehealth visits were for evaluation and management services, followed by behavioral health services. MedPAC’s analysis 

shows that 10 States accounted for almost half of all Medicare telehealth visits. 

For Medicaid, the use of telehealth varies by State, as individual 

States have the option to determine whether to cover telehealth 

and what types of telehealth services to cover, among other things. 

We reviewed six States to gauge the extent to which telehealth is 

used by Medicaid. We found that officials from States that were 

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6 

generally more rural than urban said they used telehealth more 

frequently than officials from more urban States. 

For example, Montana officials told us that they have used telehealth as a tool to help patients see both in-state and out-of-state 

specialists remotely, as there is a limited access to specialists in 

the State. 

In contrast, officials from Illinois, which contains more urban 

areas, told us that telehealth represented a very small portion of 

their Medicaid budget and was used primarily to provide behavioral health services. 

Second, stakeholders that we interviewed identified factors that 

encouraged the use of telehealth in Medicare, including the potential to improve or maintain quality of care, address provider shortages, and increase convenience to patients. 

For example, telehealth can increase convenience by shortening 

or eliminating travel times, which may lead to better adherence to 

recommended treatment and to patient satisfaction. However, 

these stakeholders also identified several potential barriers to the 

use of telehealth in Medicare, including payment and coverage restrictions. 

For example, officials from one provider association reported that 

Medicare’s telehealth policies for payment and coverage, such as 

those restrictions that limit the geographic and practice settings in 

which beneficiaries may receive telehealth services, are more restrictive than the policies of other healthcare payers. 

Finally, as of April 2017, CMS was supporting eight models and 

demonstrations that have the potential to expand the use of telehealth in Medicare. For example, one demonstration aims to develop and test new models of integrated healthcare in sparsely populated rural areas. Under the demonstration, CMS allows participating providers to receive cost-based payment for telehealth when 

their location serves as the originating site, rather than the approximately $25 fixed fee that CMS otherwise pays originating 

sites. 

In summary, while the use of telehealth in select Federal programs is low, it remains an important alternative to providing 

healthcare services in person, especially for patients who cannot 

easily drive long distances for care. 

Chairman, ranking members, and members of the Subcommittee, 

this concludes my prepared remarks. I would be pleased to answer 

questions at the appropriate time. 

Chairman BLUM. Thank you Ms. Clowers. 

I now recognize Ms. Johnston for 5 minutes. 

STATEMENT OF BARB JOHNSTON 

Ms. JOHNSTON. Thank you. Honorable Steve Chabot, Chairman 

Blum, and other members of the Subcommittee, my name is Barb 

Johnston as announced—— 

Chairman BLUM. Can you move closer to the microphone or 

move it closer to you? Thank you. 

Ms. JOHNSTON. Does that work better? Okay. So sorry. I have 

been working in telemedicine for so long now I am thinking of 

lying. It has been over 20 years. It has been a labor of love. I have 

learned so much along the way. Today, I am here as a private citSBREP-219A with DISTILLER

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izen. I am doing that because I have been working in so many different areas, I wanted to cover lessons learned from so many of the 

opportunities I have had to work primarily serving people in rural 

areas. 

As mentioned before, the core problem for rural medicine is 15 

percent of the Americans who live there are only served by 10 percent of the Nation’s doctors. Telemedicine has been around for a 

long time. Some of you may not know that psychiatry, telepsychiatry has been practiced for 50 years, half a century. 

So far, there are some key things I wanted to share with you 

that have been demonstrated and that people have already mentioned, but I want to bring it up again. Telemedicine has shown 

and has massive capacity to keep rural dollars in rural communities. It supports rural primary care providers and clinics. It helps 

keep hospitals and clinics open. Without the support of specialists 

through these modalities that are so commonly used in our everyday life, such as using our cell phone, which is just a minicomputer 

or banking or education—people in this country expect to be able 

to use technology to receive appropriate and high-quality care 

using telemedicine, and it is happening. It is happening all over 

the country. It is growing. 

It encourages recruitment and retention of the local doctors and 

providers who do serve physically in person in rural communities. 

Many, many studies, work that I have done, continues to show it 

does lower the overall cost of care. It can actually avoid small businesses closing. A person who owns a small business or a worker in 

a rural community who has to travel 3, 4 hours out site has to shut 

down that business that day. It costs them so much money and is 

so unnecessary. They lose wages, and the community may lose the 

barber shop, the only restaurant in town. 

It also helps support health IT workforces. Every program I have 

ever started has included people in rural communities learning to 

use these technologies, and one thing you all should know: Rural 

people are very smart. They catch on very quickly. They are brilliant at putting these things together. 

I think we all know that the cost of healthcare in this country 

is significant. It is growing. Telemedicine has the capacity to help 

resolve some of that financial burden. There are laws and regulations that could help significantly. I am identifying three that are 

crucial. 

Number one is the problem we have with the DEA rule related 

to a 2008 bit of legislation called the Ryan Haight Act that inadvertently prevents our doctors providing the medication that they 

need so that when a telemedicine service is provided, specifically 

it affects three groups: Opiate addicts who need the medication, the 

doctors are not allowed to do the prescription online. All the doctors that we work with use electronic health records. They can’t 

provide the drugs that these opiate addicts need. Our veterans, and 

I have seen a lot of them, they cannot receive the basic medications 

they need for PTSD, traumatic brain syndrome, just because of an 

inadvertent inclusion in that DEA rule. That could and should be 

changed and corrected. Children with ADDH, they lose school days. 

They can’t pass because they can’t get the medication they need. 

SBREP-219A with DISTILLER

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One of the biggest problems we have had since Medicare instituted the rural requirement, this limits patients with Medicare 

who live in geographic locations that are defined by, in my opinion, 

very narrow rural designation; they can’t receive Medicare services. 

Those constituents are getting more and more upset. They are seeing these things on TV. They know telemedicine exists. Medicaid 

doesn’t have these rules, but Medicare does. 

And the last one is the complicated credentialing licensing problems. 

I see my time has run out. So I will leave where I am because 

I hit the key elements, and I am grateful, very honored to be allowed to present to you, and thank you so much for your consideration on this important topic. 

Chairman BLUM. Thank you, Ms. Johnston. We are grateful 

that you are here, as well. 

Mr. Adcock, you are recognized for 5 minutes for your testimony. 

STATEMENT OF MICHAEL ADCOCK 

Mr. ADCOCK. Thank you. Chairman Chabot, Chairman Blum, 

Ranking Members Schneider and Lawson, and members of the 

Small Business Committee, thank you for the opportunity to appear today. I am Michael Adcock, Executive Director for the Center 

for Telehealth at the University of Mississippi Medical Center in 

Jackson, Mississippi. I am honored to talk with you this morning 

about telehealth and the ways its power can be harnessed to address the healthcare needs of America’s small businesses. 

Mississippi has significant healthcare challenges, leading the Nation in heart disease, obesity, cardiovascular disease, and diabetes. 

These and other chronic conditions require consistent quality care, 

a task that is made harder by the rural nature of our State. In 

order to improve access to care and give Mississippians a better 

quality of life, it is clear that we need something more than traditional clinic and hospital-based services. 

Telehealth has been a part of the healthcare landscape in Mississippi for over 13 years, beginning with an aggressive program to 

address mortality in rural emergency departments. This program 

has had a significant impact not only in bringing quality care to 

the residents of these communities but in supporting the viability 

of the community hospitals themselves. In some cases, 

TelEmergency prevented hospital closures that would have been 

detrimental to these underserved communities. 

Today, the UMMC Center for Telehealth delivers care in over 

200 sites in 68 of our State’s 82 counties and provides access to patients who might otherwise go untreated. Maximizing our utilization of healthcare resources through the use of technology is the 

only way that we can reach all of the Mississippians who need 

care. 

Small businesses account for 99.9 percent of all firms in the 

United States and often cite access to healthcare has their number 

one concern. Decreasing absenteeism, increasing productivity, and 

improving access to high-quality care are concerns to small businesses owners and were the drivers behind the creation of our 

eCorporate program at UMMC. This program allows employees to 

access high-quality care from their workplace through secure 

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audiovisual connections, avoiding travel to seek medical care and 

promoting appropriate use of healthcare resources at a lower cost. 

Several corporations have chosen to pay for this service for their 

employees and allow paid time during the workday to use the service, further reducing barriers to healthcare. 

Should an employee have a need outside the scope of telehealth, 

UMMC assists in securing appropriate followup with local providers. The eCorporate program currently covers more than 4,000 

employees and dependents statewide. We offer wellness services 

and diabetes prevention management services for corporations, as 

well. 

Another program that has been very impactful for patients is remote patient monitoring, which supports patients as they manage 

these chronic diseases in their home. RPM is designed to educate, 

engage, and empower patients so they can take care of themselves. 

Our initial pilot with diabetics in the Mississippi Delta was a public-private partnership to test the effectiveness of remote patient 

monitoring using technology in rural, underserved areas. 

The preliminary results showed a marked decrease in blood glucose, early recognition of diabetes-related eye disease, reduced travel to see specialists, and, most remarkably, no diabetes-related hospitalizations or emergency room visits among our patients. 

The Mississippi Division of Medicaid extrapolated this data to 

show a potential savings of $180 million per year if 20 percent of 

the diabetics in Mississippi on Mississippi Medicaid participated in 

the program. Given the success of this diabetes pilot, UMMC Center for Telehealth has expanded remote patient monitoring statewide. 

Healthcare is a major economic driver across the United States, 

and this has already been discussed. In Mississippi, hospitals boast 

over 60,000 full-time employees and create an additional 34,000 

jobs outside of their facilities. For every new physician creates approximately 21 jobs and more than $2 million in revenue for our 

community. For every three jobs created by a hospital, an additional job is created by other businesses in the local economy. 

Our telehealth program directly supports the financial viability 

of the healthcare system, especially primary care providers’ offices, 

small rural hospitals, and rural healthcare clinics. Keeping services 

in the communities not only supports the local providers but keeps 

much needed employment and revenue in the rural communities. 

Businesses in Mississippi that have utilized our telehealth and 

remote patient monitoring programs have seen improved access to 

care, decreased healthcare costs, and improved quality of care for 

their employees. Healthy employees mean decreased absenteeism, 

increased productivity, and a greater chance for small businesses 

to remain viable. 

Thank you all for your time and attention to this very important 

matter. 

Chairman BLUM. Thank you, Mr. Adcock. 

And for some reason, you are a little easier to understand than 

my good colleague and friend, Mr. Kelly from Mississippi. So we 

appreciate that. 

Dr. Schmitz, you are now recognized for 5 minutes. 

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STATEMENT OF DAVID SCHMITZ, M.D. 

Dr. SCHMITZ. Good morning, Mr. Chairman, ranking members, 

and members of the Subcommittee. Thank you for inviting me here 

to testify. My name is David Schmitz, and I am a family physician 

who has practiced and taught in rural America for more than 20 

years. I am here today representing the National Rural Health Association where I currently serve as president, and I am grateful 

to have this opportunity to discuss rural healthcare and its impact 

on rural America and local economies. 

For 62 million Americans living in rural and remote communities, access to quality and affordable healthcare is a major concern. Rural Americans on average are older, sicker, and poorer 

than their urban counterparts, as we have heard. They are also 

more likely to suffer from chronic diseases that require ongoing 

monitoring and follow up care. Local care is necessary to ensure 

patient ability to adhere to the treatment plans to help reduce the 

overall cost of care and to improve patient outcomes and their quality of life. 

Whether following the delivery of a healthy baby or significant 

loss of function due to stroke, local integrated care for rural people 

in their own support systems is not only the right care; it is better 

care. 

Rural communities are resourceful, and the continuity of care is 

primary to good outcomes, such as avoidance of hospital readmissions. Investing dollars locally can save what would otherwise be 

wasted dollars lost to inefficiencies, anonymity, and the gaps that 

occur in the miles between. 

There is no doubt that rural healthcare delivery is challenging. 

Workforce shortages, older and poorer patient populations, geographic barriers, low patient volumes, and high rates of publically 

insured Medicare and Medicaid recipients, uninsured and underinsured populations are just a few of the barriers. 

Unfortunately, a growing number of rural Americans are living 

in areas with limited healthcare options. Indeed, 81 rural hospitals 

have closed since 2010, leaving many rural Americans without 

timely access to emergency care. Two of the most recent of these, 

closing on June 30 of this year, were in Florida and Texas. 

As noted in my written testimony, health disparities between 

rural populations and their urban counterparts are pronounced, 

and this can be particularly true among the growing minority populations in rural America. Rural healthcare providers are not only 

critically important for health of rural Americans, they are also 

critically important for economic health of rural communities. 

While many industries in rural America have been shrinking, 

healthcare is an industry with the potential to reverse declining 

employment. As factory and farming jobs have declined, the local 

rural hospital often becomes the hub of the local business community, not only offering critical lifesaving services, but representing 

as much as 20 percent of the rural economy. Simply put, hospitals 

provide a large number of jobs. 

The average critical access hospital creates 195 jobs, generates 

$8.4 million in payroll annually, and rural hospitals are often the 

largest or second largest employer in a rural community, along 

SBREP-219A with DISTILLER

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with the school system. This was true in the community I practiced 

in of 2,303 people for 6 years. 

In addition, a single rural primary care physician, again as we 

heard, can generate as many as 23 jobs and more than a million 

dollars in annual wages, salaries, and benefits. In my own personal 

experience, rural communities are both resourceful and resilient. 

As referenced in my written testimony, training doctors and other 

health professionals close to home makes it more likely that they 

will call that place home. 

In order for this to occur, we must have technology across a rural 

distributed campus, per se, training our workforce to meet the 

needs of rural communities and at the same time providing economic investment in those rural places. 

Graduate medical education or residency training regulatory reform, allowing for education of physicians in rural hospitals, is one 

example of how to address rural economic development and workforce shortages in one action while improving quality of care and 

delivering cost-saving healthcare. 

Technology. Technology, such as telemedicine for consultation 

services have supported rural delivery of care but depend on adequate development of broadband internet into rural and remote 

areas. Still hands-on care is needed when an unexpected car accident or early delivery of a premature baby occurs in rural America. 

No matter if you are a local resident or simply visiting, each one 

of us who will spend our time and dollars in rural communities, 

and at those times, will appreciate quality local care in those moments. 

In addition to these lifesaving measures, healthcare is one industry capable of playing a critical role in supporting the local economy and protecting rural communities from further economic damage. If roads and internet access are the blood vessels and the 

nerves, then, in my opinion, healthcare is the backbone for investing in rural America. 

Thank you again for the invitation to speak and to accompany 

my written testimony as submitted. 

Chairman BLUM. Thank you, Dr. Schmitz. 

I now yield to the chairman of the Subcommittee on Health and 

Technology, Ms. Radewagen, for her opening statement. 

Chairwoman RADEWAGEN. Thank you, Mr. Chairman. 

I want to apologize for being a little bit late. I was on the Senate 

side testifying on behalf of the Secretary Zinke’s Assistant Secretary for Insular Areas, which is our areas. 

So, talofa. Good morning. Thank you, Chairman Blum, and 

thank you all for testifying today. Good morning to Chairman 

Chabot, as well. It is an honor to chair the Subcommittee on 

Health and Technology, and I look forward to learning more today 

about how both health and technology can benefit small businesses 

and rural communities. 

According to recent data from the Kaiser Family Foundation, 

American Samoa is facing tremendous shortages of primarily 

healthcare professionals and is currently only meeting around 10 

percent of need in terms of the number of physicians available to 

serve the population. The Samoan Islands have among the highest 

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12 

rates of obesity and type 2 diabetes in the world, with one-third of 

American Samoans suffering from diabetes. 

If medical treatment is unavailable on the island, patients, including many VA beneficiaries, generally have to fly nearly 3,000 

miles to Hawaii to see a specialist. Recently CMS granted a waiver 

that will allow Medicaid patients to go to New Zealand instead. 

That has been helpful. 

I am very interested in hearing and learning more about strategies for increasing the use of telehealth in rural and remote areas, 

like American Samoa, where provider shortages are severe. I also 

look forward to hearing more about how telehealth could attract 

more new or current physicians to locate their practices in rural 

areas, like American Samoa, where the tropical scenery, rain forests, beaches, and reefs are second to none. 

I want to thank all the witnesses for being here today, and I 

yield back my time to Chairman Blum. 

Chairman BLUM. Thank you, Ms. Radewagen, and thank you for 

that commercial at the end. We agree with you. 

I now recognize myself for 5 minutes of questions. I love this 

topic. I think, you know, the increase in costs in healthcare in our 

country are not due to one large thing or two large things. I think, 

and pardon the pun, it is death by a thousand cuts. The increased 

costs are because of a thousand smaller things, and I also think the 

solution is not one silver bullet to solving increased access and decreased costs while keeping our quality high. There is not one silver bullet. I think it is a thousand smaller things, if you will. I absolutely believe one of those things smaller things is telemedicine. 

I would like—this is for the whole panel—ideas of where—the 

Federal Government is the largest purchaser of healthcare in the 

country, obviously. I would like to hear from you places the Federal 

Government can increase the outcomes, the quality of the outcomes, increase access, decrease costs by utilizing telemedicine that 

we are not doing today. Give me two or three great examples of 

here’s where we can save money and increase—improve the outcomes for patients. Anyone? 

Dr. Schmitz. 

Dr. SCHMITZ. Thank you, Mr. Chairman. 

Just a couple of brief examples. One is you have heard the use 

of Tele-Emergency medicine. Again, how can you develop a relationship between a, for example, family physician and a critical access hospital; being able to be simultaneously supported both in 

their practice, which retains them, and also lowering the barrier to 

recruiting to rural areas. At the same time the transfer, if necessary, is expedited with high quality care. 

Another example is tele-ICU or intensive care unit, consultation, 

allowing again, patients to stay in place, when possible. A third example is something called Project ECHO, which is a learning group 

where you can have essentially development of teams across the 

spectrum disease, including opioids, to be able to develop better 

practices across the country. And my final and fourth would be, 

again, the use of technology in telemedicine in distributed medical 

education and health professions education, training people as close 

to home as possible. 

SBREP-219A with DISTILLER

13 

Chairman BLUM. So these items you just mentioned, Doctor, are 

not being done today? 

Dr. SCHMITZ. To a certain extent they are, but there are also 

opportunities with regard to reimbursement mechanisms and regulatory mechanisms that would allow this to be expanded, particularly into rural areas. One example I mentioned was graduate medical education funding and residency funding reform, allowing 

again, more cost-based reimbursement or more support of these 

both workforce initiatives as well as healthcare delivery mechanisms. 

Chairman BLUM. Thank you. 

Are there others? 

Ms. Johnston? 

Ms. JOHNSTON. Thank you. I think the market has the potential to drive expansion massively if the handcuffs could come off, 

and I mean that in reference to my earlier remark, the limitation 

of the location of a patient being rural or not rural. It actually 

doesn’t make any sense to me. It doesn’t make sense to constituents when you have a neighbor who has Medicaid and they can see 

a doctor, and their next-door neighbor has Medicare and they can’t, 

and that conversation is growing. I am hearing—I am an active 

member of the American Telemedicine Association, so I hear it 

from my colleagues all over the country. If that one thing could get 

corrected, I think the market would drive expansion, and it would 

help business in this country. 

The other place is in skilled nursing facilities. Skilled nursing facilities primarily are caring for our elderly, some disabled, and in 

those facilities, almost all of the ones that we have approached 

even when I was in the position of having millions of dollars to 

fund programs, which I did, I couldn’t get one nursing home to accept starting a program for fear that there would be an incorrect 

billing and they would be doing fraud, or because they would have 

some of their clients not being able to access care, and they didn’t 

want to look like they were preferentiating one group over another. 

Chairman BLUM. Mr. Adcock? 

Mr. ADCOCK. Yeah, another area that is not currently being 

paid for through Medicare, not being reimbursed with Medicare, is 

remote patient monitoring, so chronic disease management in patients’ homes. As we know, Medicare recipients often struggle from 

many chronic diseases, not just one, but diabetes, heart disease, 

and that is something we can impact through remote patient monitoring. Right now, there is not a payment mechanism for remote 

patient monitoring through Medicare. 

Chairman BLUM. Do you feel this would actually save the government money or improve the outcome? 

Mr. ADCOCK. Absolutely. Yes. I mean, similar to what we have 

done in Mississippi with Medicaid, I definitely—Medicaid, obviously, in Mississippi, is funded by Federal and State dollars. There 

is a tremendous savings just in diabetes. So, yes, we are performing this service in congestive heart failure, hypertension, asthma, COPD. There are many different chronic modalities that are 

costing a lot of money, and a lot of our healthcare resources that 

can be taken care of in the home through technology. 

Chairman BLUM. Thank you. 

SBREP-219A with DISTILLER

14 

And now my time has expired, and I now recognize the ranking 

member, Mr. Schneider, for 5 minutes. 

Mr. SCHNEIDER. Thank you, Chairman Blum. 

And thanks again to the witnesses for being here and sharing 

your perspective. 

Ms. Johnston, I just want to say you should not be hiding the 

fact that you have been working this area for so long, but wearing 

it as a badge of honor because it is critical. 

And I will also say you mentioned that we’ve been doing telehealth in psychiatry for 50 years. One of the things that struck me 

is that the phone was patented—and I had to look it up—the phone 

was patented in 1876. As we have new technologies, I don’t want 

to wait 100 years or 90 years to start using them again. 

Much of the conversation is often around telehealth filling gaps. 

If—for rural communities, there are gaps in care. Mr. Adcock, I 

think as you were talking about what you are doing in Mississippi, 

it’s creating opportunities to improve healthcare, improve its efficiencies, lower its costs, and have better outcomes. And I hope, over 

the course of time, we can move our conversation from filling the 

gaps to really finding ways to use telehealth to make a difference. 

I think the rural communities and the small businesses, as you discussed, provide that great opportunity. So I will get off my soap 

box, but I did want to just emphasize that. 

Dr. Schmitz, you said you’ve been in this area for a long time. 

We hear about the shortage of doctors for so long. Earlier this year, 

I was privileged to introduce the reauthorization of the Conrad 30 

program, which would bring doctors from other countries into our 

rural communities helping to fill that gap again. But I would be curious from your experience, if you have seen that program and 

other programs of graduate medical education to support doctors 

coming into where the need is the greatest, share your thoughts, 

please. 

Dr. SCHMITZ. Thank you, Ranking Member Schneider. I appreciate the opportunity to answer. We have seen benefits. There is 

no doubt about the need that we have, from a provider workforce 

standpoint, in rural America. And I think programs as such you 

have mentioned have been an important opportunity to be able to 

serve those needs. 

I actually have done research looking at the recruitment of rural 

providers into both several States here in the United States as well 

as comparing that to other countries, such as in Australia, and I 

think as we look at a global need with regard to, as you said, not 

only beginning to have an adequate workforce in place, but really 

have a healthcare team that provides the most efficient and effective care to people, that the advent of technology has really 

changed the dynamic. Not only do we see doctors who still do house 

calls, but we also see physicians and really healthcare teams that 

can deliver everything from occupational therapy to dietician services and, most critically, mental health services locally as a team 

through use of technology and local providers. It is still about the 

relationship, isn’t it, between the patient and the provider, between 

a couple of neighbors in a small town, that really I think to a certain extent impacts the quality of care and some of that efficiency, 

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15 

nology has really changed the dynamic. And I think the example 

of health monitoring, where patients are empowered to be able to 

then access local healthcare and subspecialty care as needed, can 

change the fabric of what that appears to be. That will draw graduates from all over the world, I think, to appreciate what it means 

to be part of a rural community and a provider in those communities. 

Mr. SCHNEIDER. Great. Thank you. 

Mr. Adcock, you talked about your program, and I just want to 

clarify that I heard it right. Emergency diabetes check-ins went to 

zero in the program, you said? 

Mr. ADCOCK. That is correct. The first—of the members of the 

study, they had zero ER visits, zero hospitalizations for the first 6 

months of the program. 

Mr. SCHNEIDER. That is extraordinary. 

Mr. ADCOCK. It is. 

Mr. SCHNEIDER. Are there things that you identify that were 

critical to that? Are there barriers to taking a program like this 

across the country? 

Mr. ADCOCK. I think that the critical barrier—I mean, the critical success factors were the fact that we didn’t just monitor. There 

are a lot of monitoring programs. Even though we call our program 

remote patient monitoring, we actually engage with the patient 

and provide them education. So I think providers—all the providers 

I have talked to would agree that, if they had the opportunity to 

educate their patients in small bits every single day and check on 

them and provide real-time intervention, they would, but that is 

not realistic. 

So that is something we can deliver through technology. So that 

is where they benefitted was learning about their disease process. 

Diabetes, while it is not complicated to me or some of the providers, it is complicated to someone who is newly diagnosed and 

doesn’t understand what they should eat, what they shouldn’t eat, 

when they should exercise, how much water they should drink. So, 

when you can provide that education in a home daily in small, bitesized pieces, it is extremely beneficial to them. And, also, when 

they slip or when they make a mistake and they eat the pecan pie, 

which we often do, when they check their blood sugar, we know it, 

and we are able to intervene immediately instead of waiting 3 

months for the next in-person visit. 

So I think it is that relationship and the engagement and the 

empowerment; teaching them to take care of themselves was the 

big success factor. 

Mr. SCHNEIDER. Thank you. 

And I am out of time. I just want to add one more comment. Ms. 

Clowers, thank you for the testimony, but the discussion around 

the different pilots that you all are doing to take those pilots where 

there are successes and getting it out, if there is anything we can 

do to help, please look to us. 

And, with that, I yield back. Thank you. 

Chairman BLUM. Thank you, Mr. Schneider. 

And I will recognize the gentleman from Mississippi, Mr. Kelly, 

who is also our chairman of the Subcommittee on Investigations, 

Oversight, and Regulations for 5 minutes. 

SBREP-219A with DISTILLER

16 

Mr. KELLY. Thank you, Mr. Chairman. 

And, Mr. Adcock, it is nice to have someone here who does not 

have an accent. 

Mr. ADCOCK. It took a lot of practice. 

Mr. KELLY. How does Medicare’s definition of rural area—and 

I know Ms. Johnston talked about this to—present challenge for 

providers wishing to incorporate telehealth into their practices, and 

specifically I know, in Union County, because one little area is so 

many miles from a four-way, they don’t qualify, but from a fourlane highway, but people don’t understand: Driving distance and 

miles are different, especially in rural areas. So, if you can do that, 

Ms. Johnston, after him, if you would like to follow up, I would 

really appreciate that. 

Mr. ADCOCK. We talk a lot about rural versus urban settings 

and rural designations. What we see in telehealth, and Mississippi 

is certainly rural, and we have a lot of rural areas. We also have 

urban areas that don’t qualify for as a CMS service. So I would like 

to steer the conversation away from geography. The fact is we have 

healthcare resource shortages, and it doesn’t matter. I can tell you 

a specific example. Dermatology in Mississippi, it takes 6 months 

to get a dermatology appointment in Mississippi. It doesn’t matter 

if you live right next to the University of Mississippi Medical Center or if you live 180 miles away. Geography doesn’t matter in that 

case. 

So it is more to me about healthcare resource shortages and 

being able to address those. Those don’t always happen exactly the 

certain distance from a four-lane highway; they happen all over the 

place. So being able to lose that geographic restriction would be 

great, if we could lessen that or get rid of it all together, because 

the fact is access to care isn’t just about urban versus rural. It is 

about whether or not there is a resource available and how a patient can access that resource. 

Mr. KELLY. Ms. Johnston, briefly. 

Ms. JOHNSTON. Thank you. Let me give you two quick examples. Number one, a small town in Wyoming where they have a 

huge backlog, patients needed to see a psychiatrist. They absolutely 

refused to allow us to provide telepsych, an entire program paid 

for, because they were so afraid of complications with not billing 

correctly. That is just one example. 

Second example, we have been recently approached to provide 

telepsychiatry services to Puerto Rico. They identified six clinics. 

They gave us the addresses. We went online because there is a site 

under CMS to make sure that you are allowed to do it because they 

require that the Medicare also be seen. Not one clinic across Puerto 

Rico was considered to be meeting that definition. The program 

cannot go forward. I have been to Puerto Rico. I have driven all 

over it. I still can’t find a nonrural area. 

Mr. KELLY. And that being said, you know, Mr. Adcock, I want 

to ask this question, but I think it is important: It is more economy 

driven than it is rural or urban. There are a lot of inner city areas 

that have the exact same issues that rural areas have. They have 

the exact same travel distance or challenges that a rural area 

would have, and I think it becomes about people who are a lot of 

times impoverished, who don’t eat well, and who are not educated 

SBREP-219A with DISTILLER

17 

in what those diseases are, and are a long distance in time or access from medical, and I think we owe it to them to get medical 

access and I think telehealth can do that. That being said, Mr. 

Adcock, what are the benefits of small businesses offering telehealth in the workplace? 

Mr. ADCOCK. I think, again, it is access. It allows access for employees who may not have access to healthcare otherwise. Also, it 

forms that relationship. Once they start seeing a provider, and we 

are able to refer them to a local primary care physician, it completes that relationship. And the earlier they can get access to care, 

the more likely they are to recognize a disease, whether it be 

prediabetes, whether it is diabetes, hypertension, it could be, you 

know, eye disease, any other disease. So early access is important. 

And limiting those barriers. 

So a lot of employees are main providers for their home. They 

are not able to take off half day to go to a physician’s office, and 

they may have to drive 40, 50 miles to the physician’s office, wait 

in the waiting room, be seen, and they have missed half a day of 

work, they have to pay their copay, they will just be sick. And employees who aren’t well aren’t productive. It is not good for the 

small business. So being able to decrease absenteeism, increase 

productivity is extremely important for those small businesses and 

could mean the difference between keeping them viable or not. 

Mr. KELLY. And just in closing, Mr. Chairman, I will just say 

telehealth is the wave of the future. We know preventative medicine is one of the primary cost-saving benefits that we get in America, and using technology to get that is a no-brainer to make sure 

that we use this and maximize this for small businesses and for 

our medical care. 

Thank you, and I yield back. 

Chairman BLUM. Well said. Thank you, Mr. Kelly. 

And I now recognize the gentleman from Florida, Mr. Lawson, 

who is also the ranking member on the Subcommittee on Health 

and Technology for 5 minutes. 

Mr. LAWSON. Thank you. 

Dr. Schmitz, rural America includes approximately 57 million 

people and about 20 percent of the population. There are 1,855 

rural hospitals that support nearly 2 million jobs. How does improved access to care in rural areas benefit the local economy? 

Dr. SCHMITZ. Thank you, Congressman. 

You are exactly right that, again, the testimony that I provided 

in writing and accompanying here with you is that local hospitals 

are a driver of the local economy, not only directly with regard to 

employment of physicians that results in economic stimulus and 

further jobs, but also, with regard to keeping the opportunity for 

growing other businesses local. 

Again, I have had experience in North Dakota but also now 20 

years of experience in Idaho, and I can remember times when, during difficult fiscal discussions, we talked about roads and we talked 

about healthcare and we talked about education because we knew 

that would bring industry to our small towns. That was an economic driver in itself but also built, again, a framework upon which 

we could see economic growth. 

SBREP-219A with DISTILLER

18 

So I would commend the opportunity to speak with you and 

agree on the fact that rural hospitals, and at this point, in particular in time, saving rural hospitals, recognizing not only their 

cost effectiveness to quality care but also the fact that they are an 

economic driver in our Nation is a timely discuss. Thank you. 

Mr. LAWSON. Okay. Thank you. 

And, Doctor, I am going to ask you this question simply because 

I was involved in it. In 2000, we in the legislature in Florida authorized a medical school at Florida State, and a key factor in authorizing that medical school is that they were going to train physicians to go into rural areas because other people might want to 

comment on that. So that has been 17 years later, but what I understand, and a lot of these students once they finish, because of 

tremendous loans and stuff in medical school, they want to go into 

the cities where they can make a little bit more money to take care 

of medical loans. Have you seen in medical schools, has this philosophy changed, and have we worked out anything to cause them to 

go into rural areas? 

Dr. SCHMITZ. Thank you, Congressman. That has been the 

study of my last 10 or 15 years since leaving rural practice myself 

but staying in contact with rural medicine as a medical educator. 

I think you are right that we have found that intentional public accountability with regard to medical education is key, and training 

in interprofessional health teams is also important. 

One of the things that I have seen is that we train to have people 

remain. I could say being from the country from the sticks, training 

in the sticks’ sticks. And one of the things that we have found is 

that, with studies we have actually done, including rural training 

track residency education, where we actually have physicians 

training during their residency in rural places such as critical access hospitals have a higher likelihood that those physicians will 

remain in rural and underserved communities. 

So I think those sorts of investments and the opportunities to 

look at regulatory relief or funding and then encouraging again our 

medical schools to have these sorts of tracks for rural providers 

shows that there is the evidence, is that, where they train, they are 

more likely to remain. This accompanied by loan repayment opportunities, both at the Federal and State level, and mentoring— 

frankly, mentoring of physicians, so that they can see themselves 

there, especially now in the advent of the utilization of technology 

where now we can see our patients are supported to be self-empowered around their disease conditions. But, frankly, I think that I 

can tell you, as a 29-year-old doctor in an ER, it is a little bit scary, 

and you want to do the best you can, and you know you will do 

the best you can, but having an opportunity to have that consultation and mentoring, not only in person and in practice with your 

partners but also through telehealth, makes a powerful statement 

to our young students. 

Mr. LAWSON. My time has almost expired, but, Ms. Johnston, 

since you have been at it for a very long time, do you see any difference of it really working in the training in medical schools, a 

physician to go right in the rural areas? 

Ms. JOHNSTON. I think one of the strategies that we have done 

in the State of California, I served on the board of trustees for the 

SBREP-219A with DISTILLER

19 

Health Education Foundation, and what that sought to do, and it 

has been very effective, we provide loan repayment for primarily 

physicians but other healthcare workers who will serve in rural 

areas. That has been the most successful thing we have ever done, 

because some of these students get out, they owe $150,000, and to 

get them to go work in a rural area where their income is going 

to be so much lower than in the urban area, this was a huge incentive. And it has been a very effective program. And we found that, 

if they stay in the rural community for 2, 3, 4, 5 years, much higher percent that they will stay there. 

Mr. LAWSON. Okay. 

And I yield back, Mr. Chairman. 

Chairman BLUM. Ms. Clowers, did you want to add on to that 

quickly? 

Ms. CLOWERS. Thank you. I just wanted to add that we did 

work issued early this spring where we looked at graduate medical 

education funding, and most of the funding is still going to urban 

areas, and that is important, as Dr. Schmitz said, because where 

people train, they tend to stay. And also what we found is that the 

Federal efforts to increase graduate medical education in rural 

areas is limited, and really that funding is driven by statute. So 

I just wanted to add that for the Subcommittee. 

Chairman BLUM. Thank you. 

Thank you, Mr. Lawson. 

The gentleman from Kentucky, Mr. Comer, is recognized for 5 

minutes. 

Mr. COMER. Thank you, Mr. Chairman. 

I have a question for anyone on the panel. Just out of curiosity. 

I assume you all kept track of both the House healthcare bill and 

the Senate healthcare bill. And I am curious, did either of those 

bills affect telehealth in any way either positively negatively or no 

impact whatsoever? Anybody know? 

Mr. ADCOCK. I don’t have any idea. 

Ms. JOHNSTON. No. 

Mr. COMER. What about a complete repeal? That is something 

that is obviously being batted around now in the Senate and in the 

House. Would a complete repeal have any impact on telehealth, a 

complete repeal? Anybody know? 

Ms. JOHNSTON. I can only imagine that, if millions of Americans lose their health insurance, it is going to have an impact on 

this Nation. And it for sure is going to impact anywhere healthcare 

is provided. 

Mr. COMER. But there is no specific part that you can think of 

that would have a—I mean, you just assume that? 

Ms. JOHNSTON. I would agree with that. Probably the best 

source to get that specific answer would be through the American 

Telemedicine Association. They have staff that are specifically looking at this. And we can follow up and get that information to you 

from the ATA. 

Mr. COMER. I certainly support telehealth. Being in a rural part 

of Kentucky, it is very challenging for our hospitals to get physicians. And this is very important. And we want to certainly support 

that. And, hopefully, we can work together and fix our broken 

healthcare system. There are parts of healthcare that are working. 

SBREP-219A with DISTILLER

20 

There are parts that I think need to be radically changed. The cost 

of healthcare is a big issue that doesn’t seem to be getting a lot of 

attention now. It is all about health insurance. But, hopefully, we 

can come to a solution and look forward to staying in contact with 

you all as we try to fix our broken healthcare system. And, certainly, for those of us that represent rural areas, telehealth is a 

very, very important part that I want to support, and I am sure 

everyone on this Subcommittee does as well. 

Thank you, Mr. Chairman. 

Chairman BLUM. Thank you, Mr. Comer. 

The gentleman from Kansas, Dr. Marshall, is now recognized for 

5 minutes. 

Mr. MARSHALL. Thank you so much, Mr. Chairman. A great 

topic, something I am pretty familiar with. 

I think, first of all, always talking about success stories. Colby, 

Kansas, Citizens Hospital. Part of the stroke collaborative program 

that Dr. Bobby Moser has piloted in Kansas, one of the greatest 

success stories I have ever seen, very dependent upon telemedicine. 

A person has an acute onset of a stroke. And if we can get that 

thrombolytic agent within 30 minutes—we talked about cost savings, so much about cost savings. The true cost savings that this 

makes is in the healthcare dollars that we are not going to spend. 

This stroke person that we prevented this stroke from becoming 

permanent, we just have saved hundreds of thousands of dollars of 

hospital bills, rehabilitation bills, and then a person that is maybe 

on a disability the rest of their life. 

So that is the beauty of this. We could talk about strokes. We 

could talk about acute MIs, again, using that thrombolytic agent. 

And what people don’t understand is these agents have very significant side effects. And it takes a lot of courage to give this drug. 

And if you don’t give it on a regular basis, you just don’t give it, 

especially not in time. The nurses drag their feet. So Colby, Kansas, is hooked up 24/7 to another busy, busy ER, and a nurse can 

take the patient’s symptoms. And while the nurse practitioner is 

scrambling to get over there, walks into the room, and everything 

is already set up and going. They have got a protocol set. We are 

getting the CAT Scan, and within 30 minutes, we can give that 

drug. And it is night and day. 

Another great success story in Kansas is the Kansas Enhanced 

Veterans Service Program. It is a mobile office that goes across the 

State. Twenty-two veterans die from suicide every day in this country. Those veterans are not going to come to the veterans hospital, 

both of them, that we have in Kansas. So we are taking the program to them. They are using telemedicine to touch base with their 

psychiatrist, their psychologist, their social workers back home, 

making sure they get their medicines. Absolutely a success story. 

My thoughts would be is that government will not solve this 

problem but, rather, innovation will continue to solve the problem. 

And Medicaid or Medicare is typically in the way of solving the 

problem. So I just would just continue to look for success stories 

and then try to, not reinvent the wheel, but keep accentuating 

those. 

So I would ask for anyone, what are the most—I shared my success stories. We can’t use a shotgun and try to use telemedicine for 

SBREP-219A with DISTILLER

21 

everything. But it has some great opportunities in the emergency 

room, and I think the psychology/psychiatry as well. 

So does anyone have a great success story they want to share? 

Dr. Schmitz, you have one? 

Dr. SCHMITZ. Thank you, Congressman. Again, I would just 

share a success story around tele-ICU. And what that is, essentially, is in, again, a critical access hospital that otherwise can provide appropriate care—I have certainly been in a situation where 

we were, frankly, weathered in. We were concerned about the safety of having a helicopter land in our town because of snow or other 

conditions, also similarly concerned, what would a patient be able 

to do with regard to ground transport for safety? In my town, there 

were 104 curves in a 19-mile piece of road on the way out to the 

urban center. So I think you are exactly right. 

And one thing we can look at is, how do we have consultation 

through telemedicine with, for example, patients who may or may 

need to be transferred the next morning and oftentimes actually 

don’t need to be transferred? Again, providing not only quality care, 

access to care, but in a fairly common scenario better care, and 

likely empower that team. 

Mr. MARSHALL. I have been in that same position so many 

times with a 25-week baby, 600-gram baby, fogged in, snowed in, 

and scrambling to try to fix that problem. I can certainly deliver 

that baby, but the problem was taking care of the baby afterwards. 

Any other great success stories that you have? 

Ms. Johnston, go ahead. 

Ms. JOHNSTON. I was PI on the Patient-Centered Medical 

Home Project. That was a program funded through CMS’ CMMI innovation initiative. And during the 2 years—3 years that we ran 

it, 2012 to 2015, we showed significant cost effectiveness. Just as 

one example, NIH, their numbers for outpatient for mental health 

patients annually averages about $1,557. Ours came out to $390. 

Patient satisfaction, over 90 percent. It was huge. 

Mr. MARSHALL. So I got 20 seconds. Where is telemedicine not 

working? Can you give me examples, anybody, where there is an 

area of medicine that it hasn’t worked very well? 

Ms. JOHNSTON. No. 

Mr. MARSHALL. Yes, sir. 

Dr. SCHMITZ. I do think we need to continue to coordinate care 

so patients have primary care access, and electronic medical 

records that are able to integrate patients’ global care. 

Mr. MARSHALL. Thank you. 

Chairman BLUM. Thank you, Dr. Marshall. 

The gentleman from Nebraska, Mr. Bacon, is now recognized for 

5 minutes. 

Mr. BACON. Thank you very much to all four of you. We have 

got votes coming up. So I will just get right to the questions. I appreciate you being here. 

First of all, a couple of you mentioned the definition for rural 

areas hurt telehealth. Is that a regulation or a law? What do we 

need to change, specifically, to fix this? 

Ms. CLOWERS. For Medicare, it is defined by statute. 

Mr. BACON. Okay. So it is on us to make that change then? 

Ms. CLOWERS. Correct. 

SBREP-219A with DISTILLER

22 

Mr. BACON. Okay. 

Ms. CLOWERS. And what it requires is, it requires both in 

terms of restrictions on the facilities as well as the location. So certain facilities are allowed, in Medicare, to be an originating site. 

Mr. BACON. Right. 

Ms. CLOWERS. As well as, it has to be located in an area that 

has been defined by HHS as being a health professional shortage 

area or outside of a metropolitan area. 

Mr. BACON. So that is a task for us to work on then. We will 

take that on. 

Second question, Ms. Clowers, you mentioned the VA using a lot 

more telehealth. Can you talk a little more about that? Because I 

know we have a big long line of people trying to get care, and this 

is one way to help. 

Ms. CLOWERS. Right. VA, what we found is that 12 percent of 

beneficiaries in 2016 were provided telehealth visits, which is much 

greater than what we saw in Medicare. And, in fact, what we also 

found was that they have over 50 different types of specialties or 

services that are eligible for telehealth, and they have less restrictions than in Medicare. So, for example, the program does allow for 

the patient to be at home for telehealth visits. 

Mr. BACON. That is great news. 

Here is one for any of you all. Who are the opponents to doing 

this? Are there industries out there or institutions that are fighting 

us? Go ahead. Please. 

Ms. JOHNSTON. I think the world of telemedicine has appropriately been challenged by a lot of really important agencies, the 

American Medical Association used to be really concerned. I think 

the concerns all stem from people wanting to make sure that we 

are doing this correctly, that we are providing quality care. Whenever we get challenged, it is never from somebody who is just saying no. It is just because they need to be educated and reassured 

that anybody who’s using these technologies is meeting, if not exceeding, the quality of care that people deserve. 

Mr. BACON. One last question. It seems that some illnesses are 

tailor-made for this, but others may be a little more challenging. 

So what is the percentage, would you say, roughly, that this is— 

telehealth is perfect for? But there is other things—sometimes you 

got to lay eyes on the infection or—you know what I am saying? 

There are some things a little more challenging that the doctor has 

to actually see it, perhaps, or take blood or something. I don’t 

know. What do you think the percentages are? 

Dr. SCHMITZ. Congressman, thank you for that important question. 

I think, first of all—and I think in response to the other question 

about the pending decisions that will come up around healthcare 

and access is in that rural America, we need to have people who 

can deliver healthcare and places where it can be delivered. So we 

look at rural health clinics, federally qualified health centers, private practices, and critical access hospitals as examples. We still 

need the providers there. If it is an automobile accident and a chest 

tube is required for a collapsed lung, we still need the providers 

there. I see telemedicine more to support those services, as well as 

to augment them. 

SBREP-219A with DISTILLER

23 

And in some ways, telepsychiatry mental health, we have even 

seen where patients will be more likely to see a telehealth provider 

in an adjunct room of the critical access hospital as opposed to 

sometimes driving down the street a block. I don’t know what the 

future holds. But I don’t see one necessarily replacing the other. 

They really come together. 

Mr. BACON. Well, thank you very much. 

I yield back. 

Chairman BLUM. Thank you, Mr. Bacon. 

As has been mentioned previously, votes have been called. So 

this is a very important topic. And we have some members here 

that still haven’t had a chance to ask their questions. So we will 

stand in recess until after the votes, and then we will reconvene. 

We shall stand in recess. 

[Recess.] 

Mr. LUETKEMEYER. [Presiding.] Okay. We will gavel our Committee back into session. And thank all of the witnesses for continuing to stick around. I apologize for the delay, but we did have 

to do a little bit of what we are here to do a while ago, which is 

go vote on some very important legislation to certain people, areas 

of our country. 

I am Congressman Luetkemeyer. I am from Missouri. I am the 

vice chair of the entire Committee. And Chairman Blum has other 

duties to attend to for the moment. So you are stuck with me to 

take us out the gate here. 

So, with that, let us continue on with the discussion we are having, and we will recognize Miss Gonza ́lez for 5 minutes. 

Miss GONZA ́ LEZ-COLO ́ N. Thank you, Mr. Chairman. 

And thank you, the whole panel, for staying here so long. 

Over the last 5 years, over 3,000 physicians have left Puerto 

Rico. And, currently, the island loses one doctor per day, as you 

may know. Hospitals and medical practice groups are finding it 

very difficult to recruit specialist physicians and experts. We are 

trying to have some kind of telehealth by medical specialists located in the U.S.-based academy medical centers, maybe can be a 

great opportunity for the island, especially in rural areas that are 

a hundred percent of the island, maybe 90 percent. Are there any 

impediments to telehealth payment arrangement when the patient 

is located at their home in Puerto Rico or at a medical facility in 

Puerto Rico and the doctor is located at a medical center located 

on the mainland? Ms. Johnston? 

Ms. JOHNSTON. Hi. It is Barb Johnston. Many. And it is problematic. As I mentioned, we have been approached, the company I 

currently work for. We have the doctors. They want to work. They 

have doctors locally that want to learn how to do this locally in 

Puerto Rico. And we are more than happy to do it. The sticking 

point is getting payment for doing it. As I said before, Medicare’s 

rule that restricts to their definition of rural for telemedicine completely blows the whole project. It prevents us from being able to 

do that. If there could be some kind of a waiver, or if we could be 

allowed to pilot, or whoever is going to be able to provide the 

care—because it won’t just be telepsych, which is what we do. 

There are others. But that is the desperate need that we have 

heard from people in Puerto Rico. So if they could do that. 

SBREP-219A with DISTILLER

24 

The other is getting a waiver to allow patients to be seen in their 

home. There are many parts of Puerto Rico where—and we have 

been told—that people don’t have transportation. Even if there was 

some, they can’t. And, like, the Veterans Administration in this 

country has been doing this for 10 years successfully, seeing patients directly at home. 

Miss GONZA ́ LEZ-COLO ́ N. Quick question. That waiver, it is 

going to be for the Federal Government or Federal—do we have to 

amend any Federal laws, or we are talking about State laws? 

Ms. JOHNSTON. I might—— 

Miss GONZA ́ LEZ-COLO ́ N. I defer to Ms. Clowers. 

Ms. CLOWERS. The requirement is through statute. So the statute defines in Medicare where the services can be provided. And 

as Ms. Johnston said, it has to be—the originating site must be in 

an area that has been designated as a health professional shortage 

area or outside of a metropolitan area. 

Miss GONZA ́ LEZ-COLO ́ N. In our case, I mean, the shortage is 

there. Actually, we are having the same problems in the VA facilities, the same as the American Samoa, where we don’t even have 

the specialists in so many areas in the VA hospital. And we have 

tried to recruit them, but it is so difficult. Because nobody wants 

to leave the mainland to go to Puerto Rico or even remote areas 

to just move their families to attend the patients there. And I 

would like to know if you can provide, the whole panel, specifically 

what kind of amendments do we need to make to change that statute? If you can provide—I mean, I know that we—in 1 minute, you 

can’t provide that. But if you can provide that to the Committee 

later on, that will help us a lot to identify those statutes with the 

correct language so we don’t mess—mess with the whole situation. 

Ms. CLOWERS. And, Representative, I would like to add, too, 

that in addition to a potential statute change, CMS, through their 

innovation center, has different models and demonstrations that 

they can run. And they have the ability to waive certain requirements. And so they would have the ability to have a demonstration 

and waive these rural requirements. 

Miss GONZA ́ LEZ-COLO ́ N. I know. 

Ms. CLOWERS. If that would be something that you would be 

interested—— 

Miss GONZA ́ LEZ-COLO ́ N. I know. We are working with them 

directly and we are trying to change the State plan. And even 

doing that, we are still facing the same problems. That is happening in Puerto Rico. That is happening in other States. So this 

is not an issue just for—but we are facing—in our case, in the islands, you can’t cross the State line. You can’t take a car or even 

take a train. You have to take a plane or a boat to take the service, 

and that is not enough. So that was the question. Since my time 

is running, is there any—can you provide any information about 

the security of the patients’ records on telehealth or how secure 

and private these records are when telehealth is employed? 

Ms. JOHNSTON. The way that most of us work—and I will 

speak to the company I currently work for. We use a fully HIPAAcompliant system end to end. We use a product called 

athenahealth. I have no investment in it, don’t own it. It is just a 

completely secure and HIPAA-compliant system. Anything that we 

SBREP-219A with DISTILLER

25 

use technologywise, the videoconferencing, the health records, any 

communication—you can’t text. There is very strict—we actually 

are the only telepsych company in the country that is Joint Commission accredited. That is just part of it. But, yeah, end to end. 

Mr. ADCOCK. Same thing. Ours is encrypted and all HIPAA 

compliant. Everything that we use goes into our electronic medical 

record, Epic. So it is all controlled just as it would be if you came 

in person. 

Miss GONZA ́ LEZ-COLO ́ N. Thank you. 

I yield back. Thank you, Mr. Chairman. 

Mr. LUETKEMEYER. The gentlelady’s time has expired. 

Next we go to Representative Radewagen, from American Samoa. 

She is the Chairman of the Subcommittee on Health and Technology. You are recognized for 5 minutes. 

Chairwoman RADEWAGEN. Thank you, Mr. Chairman. 

Ms. Clowers, American Samoa could greatly benefit from using 

health for patients to access medical care remotely without leaving 

the islands. We talked about it a bit today. However, broadband access is not sufficient. Are there Federal programs available to assist remote areas like American Samoa to support broadband for 

telehealth? 

Ms. CLOWERS. Yes, ma’am, there are. And you are correct, 

broadband is a challenge, and it is something that we heard in our 

work when we surveyed people about the barriers to using telehealth, the infrastructure that is required to successfully carry out 

telehealth. Broadband was identified as one of those infrastructure 

challenges. And there are grants that are available for different 

communities through different departments. 

And, for example, the USDA has grants. And American Samoa has received a grant, I believe in the amount of $820,000, for support in this area. And we would be happy to get you more information on that grant, if you are interested. 

Chairwoman RADEWAGEN. Thank you. 

Mr. Adcock, what are some important innovations in telehealth 

that you have experienced while working in this field? And what 

innovations may we expect in the future as more American consumers demand telehealth services? 

Mr. ADCOCK. Thank you very much. I think the innovations 

that we—I am going to go to the second part of the question first. 

The innovations that are coming in the future, I couldn’t begin to 

tell you. There are so many different wearables and sensors and 

things that are coming out now, that are being innovated now, that 

I can’t imagine what the future is going to look like from that 

standpoint. 

But I think where we focus on technology is that we wrap technology around our clinical programs. I think that our focus—while 

technology is certainly important, I think our focus is around the 

patient and what we need to do to provide excellent clinical care 

to the patients, and then we use the appropriate technology around 

that. But being able to deliver care into a home to monitor diabetes 

so that patients don’t have to plug anything in or try to transcribe 

their outcomes or their results themselves, I think that, just in the 

last couple of years, has come so very far. And being able to 

Bluetooth into these devices and use cellular technology to connect 

SBREP-219A with DISTILLER

26 

to patients and providers has come so very far in the last couple 

of years. Where it is going, I would honestly be scared to say. But 

I think that the focus needs to remain on making sure that providers and patients, not necessarily in that order, but patients and 

providers are the center of what we are doing with telehealth. This 

should be an extension of healthcare. This should be something 

that is used to help better healthcare services that can be delivered 

at home. 

Ms. Johnston, would you care to answer that question? 

Ms. JOHNSTON. I completely agree. At the American Telemedicine Association annual conference this last year, Thomas Friedman spoke, keynote, and that is really what he was echoing. He 

stood on a stage and said: Right now, with 10,000 people in this 

audience, there is a couple of guys in a garage in Silicon Valley, 

and they are ahead of us. We just need to catch up with them. 

I think it is going to be part of it. 

I think, too, the current president of the American Telemedicine 

Association, he has been putting forward and doing a lot of speaking about hybrid healthcare in a model that he sees more and more 

individual providers and health systems where they see some patients on telemedicine, use remote monitoring, and some in person. 

And that is happening quite a bit. It is spreading across major hospitals and health systems across the country. Thank you. 

Mr. Chairman, I yield back. 

Chairman LEUTKEMEYER. I understand the lady from Samoa 

has a closing statement. You can go ahead and do that. 

Chairwoman RADEWAGEN. Thank you, Mr. Chairman. 

Well, let me take this opportunity to thank all of the witnesses 

for their testimony today. As the chairman of the Subcommittee on 

Health and Technology, it is extremely valuable to hear how telehealth is helping physicians expand the services they offer and is 

offering patients more convenient options to access the healthcare 

they need. 

American Samoa is facing tremendous provider shortages, and 

telehealth services could keep our residents and their families from 

traveling long distances to receive care or going without the care 

they need. This could also benefit other small businesses by keeping dollars in the community. I was also pleased to learn that there 

is hope that telehealth will make rural areas more viable locations 

for physicians to operate their practices. Technology has improved 

many aspects of daily life, and it can potentially improve 

healthcare access as well. 

[Speaking foreign language.] 

Thank you. And I yield back to Chairman Luetkemeyer. 

Mr. LUETKEMEYER. I am glad you interpreted that for us. 

Thank you very much. 

I will defer my questions to the end. I think Miss Gonza ́lez has 

got a second round question here. 

So let’s go to Miss Gonza ́lez. You are recognized for 5 minutes. 

Miss GONZA ́ LEZ-COLO ́ N. Thank you, Mr. Chairman. I really 

appreciate that deference. I will be short. I will just leave you with 

some questions I got. 

And one is regarding Mr. Kelly, in his statement here, identified 

the issues regarding rural areas. And one of the concerns regarding 

SBREP-219A with DISTILLER

27 

Mississippi was the diabetes situation. And your experience treating patients with diabetes and using telehealth, how do they— 

those patients were improving. Do you have seen a decrease in the 

hospitalizations and emergency room visits in Mississippi? That is 

one of the questions, because we got the same situation in the island, and other situations regarding heart diseases, among others. 

That would be one of the questions. I don’t want to abuse from the 

chairman. That will be one of the questions. 

The second one is going to be in terms of is there a need for a 

certification requirement when telehealth providers are located in 

a jurisdiction other than where the medical provider is located? 

What of those requirements, if they are from a CMS, or HHS, or 

whatever they are, if the State is involved in that, and how difficult 

are those regulations to comply with? And in terms of having—is 

there any copayment to the patient if they are using health in 

terms of the veterans, if they are using this kind of program? I 

don’t know. That is going to be one of the questions. 

Mr. ADCOCK. I will take the first question around remote patient monitoring. And thank you for asking that followup question. 

Yes. In our diabetes pilot that we did in the Mississippi Delta, we 

saw significant results in the preliminary results. And the final results will be out later this month. But we saw a decrease in hemoglobin A1c, which is the measurement of blood sugar over time. We 

also saw a complete elimination of ER visits and hospitalizations 

for those patients that were on our program. So, not only did they 

just reduce their visits to the ER, we did not have any diabetesrelated ER visits or hospitalizations. 

Miss GONZA ́ LEZ-COLO ́ N. Zero? 

Mr. ADCOCK. Zero. Not saying that that would be sustained 

over a huge population. But we have seen very similar results in 

our—the final results are very much mirroring that. And the results that we see with our population that is on that program outside of the pilot have had significant results in readmissions and 

hospitalizations. So that is one of the points of the program. But 

I think the reasons for that are because of the education that we 

provide and the real-time interventions. So we teach them about 

their disease so that they can take care of the disease themselves. 

You can’t expect them to go to a provider every time something is 

going on. That is not realistic. It is not realistic for the provider. 

It is not realistic for the patient. So being able to teach them about 

their disease and then teach them as they are having issues so, if 

their blood sugar goes up, you are able to intervene at that time 

and say: This is why your blood sugar went up. This is what you 

can do to prevent it in the future. A lot of these ER visits aren’t 

due to medical emergencies every time. A lot of times they are due 

to fear. They don’t know what to do when this happens. So being 

able to educate them in real time has been a real success. And we 

have spread that program statewide. 

Miss GONZA ́ LEZ-COLO ́ N. Mr. Schmitz. 

Dr. SCHMITZ. Thank you, Congresswoman. I would just like to 

agree with that testimony and just give a quick example. If we 

look, for example, as a primary care provider, a family physician, 

per se, at the patient-centered medical home having a dashboard 

where information comes in, you can literally have, you know, 

SBREP-219A with DISTILLER

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green, yellow, red where people who are knowledgeable about this 

data can then, for example, use what is called open-access scheduling and decide who gets an acute care visit open slot with that 

provider, be it a physician assistant, physician, or otherwise, and 

avoid, again, that lack of information that otherwise might result 

in an ER encounter with someone who does not know them as well. 

Miss GONZA ́ LEZ-COLO ́ N. Thank you. 

Ms. Johnston or Ms. Clowers? 

Ms. CLOWERS. To your second question about other challenges 

with licensing, when we spoke to different stakeholders through 

our work, we did hear that licensing was a challenge. And an example of that is when you are at the distant site—if you are a provider at the distant site, you also have to be licensed in the State 

that the patient resides. And that can be challenging for different 

providers. And that is driven by State law. 

Miss GONZA ́ LEZ-COLO ́ N. Thank you. You want to add something, Ms. Johnston? 

Ms. JOHNSTON. I was just going to answer—I think you asked 

a question about a copayment for telemedicine? 

Miss GONZA ́ LEZ-COLO ́ N. Yes. Is there—— 

Ms. JOHNSTON. I have never actually heard of that. I don’t 

have any experience with that. 

Miss GONZA ́ LEZ-COLO ́ N. Okay. 

Ms. JOHNSTON. We have never done anything like that. 

Miss GONZA ́ LEZ-COLO ́ N. Okay. Thank you. 

With that, I will yield back. 

Thank you, Mr. Chairman. 

And thank you, all the members of the panel. 

Mr. LUETKEMEYER. The Gentlelady’s time has expired. 

With that, I just want to follow up with a few things. 

And I know that, Ms. Clowers, you were talking about some of 

the payment and coverage restrictions that cause problems sometimes. I think it was Ms. Johnston mentioned some of the things 

that happened and can be done or changed with regards to the locations qualifying. But with regards to payment and coverage restrictions, can CMS do this right now through their rulemaking 

process, or does that take legislation? 

Ms. CLOWERS. The coverage issue would require legislation. It 

is defined by statute. 

Mr. LUETKEMEYER. Okay. 

Ms. CLOWERS. They do have flexibilities in their innovations 

center where they are able to test different approaches with different models and demonstrations. So that would be an area that 

they could explore with a model. 

Mr. LUETKEMEYER. Okay. Some of the things you talked 

about, do you have studies that show how much it saves? 

Ms. CLOWERS. We do not. When we did our work in looking at 

the different opportunities, both benefits of telehealth, we were 

looking at CBO scores which showed—it is hard to tell sometimes 

in terms of the cost savings. It depends on how telehealth is used. 

If it is used to replace an in-person visit, that can result in savings. 

But if it is used in addition to an in-person visit, that can increase 

cost. So that is what we found in terms of the cost savings. But 

I know other witnesses here at the table have other experiences. 

SBREP-219A with DISTILLER

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Mr. LUETKEMEYER. Yeah. I think, Mr. Adcock, you were talking about your in-home monitoring programs. And did you put an 

analysis on that and see how much you actually saved with the 

pilot project you are talking about? 

Mr. ADCOCK. So the pilot project, again, was a public/private 

partnership. But our division of Medicaid actually took the data on 

the actual cost savings of those first 100 patients, first 6 months, 

and extrapolated that to say that, if 20 percent of the Medicaid patients in Mississippi who were diabetic were on the program, we 

would save $180 million a year. So, yes, there are cost—— 

Mr. LUETKEMEYER. Your State would save that much? 

Mr. ADCOCK. Yes. Yes. Medicaid would save that much so federal and state together— 

Mr. LUETKEMEYER. The State Medicaid program would save $180 million—— 

Mr. ADCOCK. Correct. 

Mr. LUETKEMEYER.—a year just on that one—— 

Mr. ADCOCK. Just diabetics, just 20 percent. So now we are 

doing hypertension and heart failure and all the other chronic diseases we are monitoring as well. So we will continue to do cost 

analysis on those programs. We have legislation in Mississippi that 

allows us to get paid for remote patient monitoring. So there is a 

fee to it, and we do receive payment. The cost savings are tremendous. 

Mr. LUETKEMEYER. Okay. And you mentioned a couple other 

things that you are working on with your more remote abilities 

here. And that was heart monitoring and what else? 

Mr. ADCOCK. Heart failure. So congestive heart failure. Hypertension. That is adult and pediatric diabetes. We are working on 

asthma and chronic obstructive pulmonary disease. All of these are 

high-cost items. We also monitor—this is outside of the reimbursement legislation in Mississippi. We also monitor bone marrow 

transplant and kidney transplant patients so that we can get them 

out of the hospital sooner and get them back home. 

Mr. LUETKEMEYER. The hearing today was with regards to 

rural telehealth. But, I mean, telehealth is something that they can 

utilize—people can utilize every day everywhere else too, many 

urban areas, suburban areas. I mean, this isn’t something confined. 

But what we are talking about here is the importance of how it 

helps the quality of life, basically, for folks in rural areas. 

And so, Dr. Schmitz, would you like to add anything to the discussion with regards to other opportunities and the cost savings? 

Have you done any studies or are aware of any of that? 

Dr. SCHMITZ. I really appreciate the opportunity, Congressman. 

One example, I think, that hasn’t been brought up is the provision 

of chemotherapy, for example. As you can imagine, in a rural critical access hospital that is quite remote from subspecialty care, 

supporting a local physician/nurse team, for example, to administer 

chemotherapy in the same quality really does prevent patients who 

otherwise would have very uncomfortable transport—not only long 

transport, but uncomfortable transport, during the treatment of 

their disease. 

Mr. LUETKEMEYER. Okay. So what we are doing is trying to 

find ways to improve the quality of health and health services in 

SBREP-219A with DISTILLER

30 

rural areas. And the things you are suggesting, is anybody putting 

this into a bill that you are aware of or just discussed it with you 

to help work on this? 

Yes, sir, Dr. Schmitz. 

Dr. SCHMITZ. I would be happy to follow up with National 

Rural Health Association how telemedicine and teletechnologies 

can be incorporated into better care—— 

Mr. LUETKEMEYER. Because the comment a minute ago was 

that some of it has to be done legislatively; some of it can be done 

through the rulemaking process. I think we have a friend with Dr. 

Price at HHS now who is willing to look at options, look at different things, different ways to deliver care, deliver services, upgrade and innovate. But by the same token, if we need to do something legislatively, I think that is where we need to go. 

Mr. Adcock. 

Mr. ADCOCK. The CONNECT for Health Act that is out right 

now addresses a lot of these issues. 

Mr. LUETKEMEYER. Okay. 

Mr. ADCOCK. It addresses the geography issues, addresses a lot 

of the reimbursement issues. So that is something that we fully 

support and would love to see some more input on that. 

Mr. LUETKEMEYER. Very good. 

Yeah. Ms. Johnston? 

Ms. JOHNSTON. I just want to second that that legislation is bipartisan, the CONNECT for Health. It would address most of these 

things. 

Another comment I would like to make, in the CMS grant that 

we were given, 2012-2015, we submitted a final report that showed 

significant cost savings. Happy to provide that to the Committee. 

The VA every year produces very good data on cost savings. And 

the American Telemedicine Association is currently collating data 

on multiple studies across the country on cost savings. 

Mr. LUETKEMEYER. Does the VA coordinate with—I guess it 

is CMS with regards to telehealth stuff? I mean, your veterans are 

scattered all over the place. I mean, and they network back, usually, to a VA facility of some sort. Does that help them or hurt 

them with access to care? Are you familiar with that? 

Ms. JOHNSTON. I don’t know that the VA works in any capacity 

with CMS. But I know that they are the largest provider of telemedicine in this country and have been. Nobody is even close to 

what they have been doing, and they keep proving every year how 

cost effective it is every year for our veterans. 

Mr. LUETKEMEYER. Okay. Very good. I am at the end of my 

questions. Would you all just like to have a closing question or 

comment or go ahead and say goodbye? Tired of listening to us? 

Yeah. Dr. Schmitz. 

Dr. SCHMITZ. Congressman, I would be just happy to first be 

the one to say thank you for the opportunity to speak about the important matters in rural health. I do think that we are seeing technology both to change access as well as quality of care and as we 

continue to see this again, as our panelists discussed, as a wraparound, person-to-person services, I think we will have better care 

for it. The example with the VA, for example, CBOCs, and how 

CBOCs can actually be co-located with other provider of services 

SBREP-219A with DISTILLER

31 

and co-supported through technology might just be one more example. So, again, Congressman, thank you for this opportunity. 

Mr. LUETKEMEYER. Mr. Adcock. 

Mr. ADCOCK. I would like to echo that. Thank you for the opportunity to come and talk about this important subject. Thank you 

for your interest and your very thoughtful questions. I do think 

that telemedicine is a way that we can spread access and improve 

quality across not just the United States but across the world, certainly across everything that the United States encompasses. So I 

think that is extremely important. And I thank you for your questions and for the time to speak. 

Mr. LUETKEMEYER. It is also great to know not everybody in 

Mississippi talks like Mr. Kelly. 

Ms. Johnston, closing comment? 

Ms. JOHNSTON. I just want to echo what has been said. But 

also just from myself thank you for what you do every day for 

Americans. 

Mr. LUETKEMEYER. Thank you. 

Ms. Clowers. 

Ms. CLOWERS. Thank you for having us. And at GAO, we are 

happy to stand ready to help with any further discussions on this 

topic. 

Mr. LUETKEMEYER. Very good. 

With that, again, I want to thank everybody for being here. As 

we heard, telehealth has the ability to connect a patient in a rural 

area to high-quality medical care at another location. This not only 

benefits the patients and their families but also may help the local 

physician to expand his or her small business. Other small businesses will benefit from dollars staying in the community. Additionally, we have heard that the availability of telehealth may attract new or current physicians to locate practices in rural communities and also how telehealth can benefit small employers and employees by offering convenient access to medical care and monitoring. In fact, I would think it would be an attractive way to attract doctors to the rural area if they know they can do it with telehealth and be—the quality of life is—coming from a town of 300 

people—it is a whole lot better than it is in the city. So, therefore, 

why not move to the country, right? But with consumer demand 

growing for more convenient and efficient options to access 

healthcare, I hope that we are able to sort out some of the barriers 

our witnesses have testified about so that small businesses and 

rural communities have all the tools they need to thrive and keep 

residents well. 

Well, with that, I ask unanimous consent that members have 5 

legislative days to submit statements and supporting materials for 

the record. 

Without objection, so ordered. 

We are adjourned. 

[Whereupon, at 12:34 p.m., the Subcommittees were adjourned.] 

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Testimony of Michael P. Adcock 

Executive Director, Center for Telehealth 

University of Mississippi Medical Center 

House Small Business Committee 

Subcommittee on Agriculture, Energy, and Trade 

Subcommittee on Health and Technology 

July 20, 2017 

Chairman Blum, Chairman Radewagen, Ranking Member 

Schneider, Ranking Member Espaillat, and Members of the Small 

Business Committee, thank you for the opportunity to appear before the subcommittees today. I am Michael Adcock, Executive Director for the Center for Telehealth at the University of Mississippi 

Medical Center (UMMC) in Jackson, Mississippi. I am honored to 

talk to you this morning about telehealth and the ways its power 

can be harnessed to address the healthcare needs of America’s 

small businesses. 

Mississippi has significant healthcare challenges, leading the nation in heart disease, obesity, cardiovascular disease and diabetes. 

These and other chronic conditions require consistent, quality 

care—a task that is made harder by the rural nature of our state. 

In order to improve access to care and give Mississippians a better 

quality of life, it is clear we need something more than traditional, 

clinic and hospital-based services. 

Telehealth has been a part of the healthcare landscape in Mississippi for over 13 years, beginning with an aggressive program to 

address mortality in rural emergency departments. In 2003, three 

rural sites were chosen to participate in a program that would 

allow UMMC board certified emergency medicine physicians to 

interact with and care for patients in small, rural emergency rooms 

via a live, two way, audio-video connection. The TelEmergency program has grown to serve more than 20 hospitals and continues to 

produce outcomes on par with that of our Level 1 trauma center. 

This program has had a significant impact, not only in bringing 

quality care to the residents of the community, but in supporting 

the viability of the community hospitals themselves. As a result of 

TelEmergency, rural hospitals are able to identify and recruit 

healthcare professionals who live in the community and desire to 

work locally. The program helps communities retain healthcare 

revenue that was lost as a result of patients being transferred out 

for care. In some cases, Telemergency prevented hospital closures 

that would been detrimental to these underserved communities. 

The success of this program and noteworthy outcomes led to the 

development of additional healthcare models using technology to 

address needs statewide. 

Today, the UMMC Center for Telehealth delivers more than 30 

medical specialties in over 200 sites across the state including rural 

clinics, schools, prisons and corporations. It is important to note 

that a very small portion of these sites are actual UMMC sites. As 

every community has different needs, we partner with local providers to address their specific needs. UMMC is committed to supporting the community providers through collaborative models that 

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1 U.S. Small Business Administration, Office of Advocacy 

promote efficient use of vulnerable resources. The depth and 

breadth of our statewide network allows us to deliver world-class 

care in 68 of our state’s 82 counties and provides access for patients who might otherwise go untreated. Over the last decade, we 

have conducted over 500,000 patient encounters through telehealth. Maximizing our utilization of healthcare resources through 

the use of technology is the only way we can reach all of the Mississippians who need lifesaving health care. 

Small businesses account for 99.9% of all firms in the United 

States and 96.2% of all Mississippi businesses. The one year survival rate for small businesses averages 78.5%. Approximately half 

of these establishments survive five years. In Mississippi, the small 

business exit rate is higher than the startup rate. Small businesses 

often site access to affordable healthcare as their number one concern. According to the Gallup-Healthways Well-Being Index, annual costs for local productivity for employees having chronic conditions totaled $84 billion. Multiple publications site that unschedule 

absenteeism costs roughly $3,600 per year for each hourly worker 

and $2,650 for each salaried employee. These factors lead to over 

$250 billion in lost economic output per year in the United States.1

Decreasing absenteeism, increasing productivity and improving 

access to high quality care were the drivers behind the creation of 

the eCorporate and eSchool Health programs at UMMC. The 

eCorporate service allows employees to access high quality care 

from their workplace through secure audio/visual connections. This 

program is employee initiated and avoids travel to seek medical 

care, promotes appropriate use of healthcare resources and is a 

lower cost alternative to the higher cost healthcare settings. 

UMMC’s eCorporate program is unique in that it is not designed 

to be a standalone means for primary care, but as an additional avenue for employees to access safe healthcare in an affordable and 

convenient manner. In many cases, this program has helped identify healthcare needs that, if gone untreated, would have resulted 

in increased healthcare burden and loss of productivity. For this 

reason, several corporations have chosen to pay for this service for 

their employees and allow paid time during the workday to use the 

service, further reducing barriers to health care. Healthcare is a 

collaborative effort, and this program is no different. Should an employee have a need outside the scope of telehealth, UMMC assists 

in securing appropriate follow up with local providers. The goal is 

to refer locally and support the local community when possible. The 

eCorporate program currently covers more than 4,000 employees 

and dependents in businesses across Mississippi We have customers with as few as 15 employees. When you add our program 

for State Employees (UMMC 2 You), we cover over 185,000 lives 

across our state. 

Our corporate offerings are not only aimed at patient initiated 

services. We currently offer wellness services and diabetes prevention/management services for corporations across Mississippi. We 

are working with some businesses to augment their current 

wellness services by helping to risk stratify their employees’ annual 

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lab work and biometric measurements. This leads to proactive visits with our providers to discuss risk factors and wellness. The goal 

is to educate these employees on healthy living and how they can 

address their risk factors to live a healthier life. 

Similarly, the eSchool Health program provides the school nurse 

with additional provider support needed to reduce absenteeism and 

improve student performance. With very few local primary care 

providers, nurses and parents have difficulty ensuring that students will have access to basic, and sometimes vital health services. With eSchool Health, school districts partner with UMMC to 

provide a more comprehensive health care offering that can assist 

with health care related needs such as asthma action plans and 

medication refills. Our eCorporate and eSchool Health programs 

are examples of working with community leaders to create an environment that is attractive to business by supporting efforts to 

produce healthy families. 

Another program that has been very impactful for patients is remote patient monitoring (RPM), which supports patients as they 

manage chronic disease in their homes. RPM is designed to educate, engage and empower patients so that they can learn to take 

care of themselves. Our initial pilot with diabetics in the Mississippi Delta was a public/private partnership between critical access hospital North Sunflower Medical Center, telecommunications 

provider C Spire, technology partner Care Innovations, the Mississippi Division of Medicaid, Office of the Governor of Mississippi 

and UMMC. The purpose of the pilot was to test the effectiveness 

of remote patient monitoring using technology in a rural, underserved area. Specifically, the desired outcome was to reduce Hemoglobin A1C by 1% in uncontrolled diabetics. The participants in 

this study received their healthcare in the local and rural health 

clinic. UMMC supported these providers by delivering diabetic education, monitoring biometrics and serving as a liaison between the 

patient and their provider as they learn to manage their condition. 

The preliminary results through six months of the study showed: 

a marked decrease in blood glucose, early recognition of diabetesrelated eye disease, reduced travel to see specialists and no diabetes-related hospitalizations or emergency room visits among our patients. This pilot demonstrated a savings of over $300,000 in the 

first 100 patients over six months. The Mississippi Division of Medicaid extrapolated this data to show potential savings of over $180 

million per year if 20 percent of the diabetics on Mississippi Medicaid participated in this program. 

Given the success of the diabetes pilot, UMMC Center for Telehealth has expanded remote patient monitoring to other disease 

states, including adult and pediatric diabetes, congestive health 

failure, hypertension, bone marrow transplant and kidney transplant. Working closely with a patient’s primary care provider, we 

continue to grow this program both in terms of volume and number 

of diseases that can be managed. Most importantly, this program 

is giving patients the knowledge and tools they need to improve 

their health and manage their chronic disease. Businesses that are 

a part of our eCorporate program are also given the option to provide this service to their high risk employees with chronic disease. 

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2 Critical Care, The Economic Impact of Hospitals on Mississippi’s Economy, 2012 

3Economic Impact of a Critical Access Hospital on a Rural Community Gerald A. 

Doeksen, Cheryl F. St. Clair, and Fred C. Eilrich, National Center for Rural Health Works 

The employers see this as a way to offer their employees additional 

support and to reduce costs incurred for after hour clinic visits and 

emergency room visits for non-emergent conditions. Many small 

businesses are self-insured, so a program of this type provides 

quality care at an affordable rate is attractive and beneficial. 

Health care is a major economic driver across the United States, 

with the sector growing at over 20% annually. In Mississippi, hospitals boast over 60,000 full time employees and create an additional 34,000 outside of their facilities. Every new physician crates 

approximately 21 jobs and more than $2,000,000 in revenue for a 

community 2. Critical Access Hospitals (CAH) are located in small, 

rural communities and are an important part of the health system. 

They are responsible on average for 170 jobs with $7.1 million in 

wages salaries and benefits. For every job in a hospital, an additional .34 jobs are created in other businesses in the local economy. 

This means that the average CAH is responsible for an additional 

43 jobs outside of the hospital and $1.8 million of taxable retail 

sales 3. 

Our telehealth program directly supports the financial viability 

of the health care system, especially primary care providers’ offices, 

small rural hospitals and rural health clinics. Supporting these 

small businesses also supports the overall financial viability of the 

community. Collaboration between the Center for Telehealth and 

providers throughout the state allow for the delivery of high quality 

specialty care in locations that are convenient for patients. These 

collaborations deliver multiple benefits: access to specialty care 

close to home, continuity of care and originating site fees to the 

local providers. These services do not cost the patients any more 

than traditional visits, but save them a tremendous amount of time 

and money on travel. For the clinics, we are able to bring a more 

comprehensive healthcare offering to their community. Keeping 

services in communities not only supports the local providers, but 

keeps much needed employment and revenue in rural communities. 

Businesses in Mississippi that have utilized our telehealth and 

remote patient monitoring programs have demonstrated success by 

improving access to care, decreasing cost of care and improving 

quality of care for their employees. Healthy employees mean decreased absenteeism, increase productivity and a greater chance for 

small businesses to remain viable. 

Thank you for your time and attention to this very important 

matter. 

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Written Testimony 

By 

David F. Schmitz, MD 

National Rural Health Association, President 

On behalf of the National Rural Health Association 

For the 

United States House 

Committee on Small Business 

Subcommittee on Health and Technology 

July 20, 2017 

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Good morning, Mr. Chairman, Ranking Member Vela ́zquez, and 

members of the Subcommittee. Thank you for inviting me here to 

testify. I am Dr. David Schmitz, a family physician who has practiced and taught in rural America for 20 years. I am here today 

representing the National Rural Health Association where I currently serve as president. I am grateful for this opportunity to discuss rural health care and its impact on rural America and local 

economies. 

NRHA’s mission is to improve the health and wellbeing of all 

rural Americans and as such, we recognize the important role that 

health care serves in the economic development of rural communities across the country. The economic needs of rural America are 

vastly different than those faced by counterparts in other geographic and population settings. So too are the health care challenges, and opportunities, for rural health care providers. 

Today I will discuss some of the unique challenges to health care 

in rural America. I will discuss how rural America has also faced 

unique economic challenges, and how strong rural health care providers can rise to those challenges by providing direct jobs, stimulating indirect jobs, supporting the growth of employers in other industries, and bolstering entire rural communities. 

I am here today to talk about the investments that we need to 

make to ensure that rural health care thrives and, in return, rural 

economies thrive and sustain our communities. NRHA believes that 

improving access to care by investing in rural health care—from 

workforce to technology infrastructure—is a means to bolster the 

local economy. This must be a priority for both the Administration 

and Congress. 

Barriers and Challenges of Rural Health Care 

For the 62 million Americans living in rural and remote communities, access to quality, affordable health care is a major concern. 

Rural Americans on average are older, sicker and poorer than their 

urban counterparts. They are also more likely to suffer from chronic diseases that require monitoring and follow-up care. 

Local care is necessary to ensure patient ability to adhere to 

treatment plans, to help reduce the overall cost of care, and to improve patient outcomes and their quality of life. Whether following 

delivery of a baby or a significant loss of function due to stroke, locally integrated care for rural people and their own support system 

is not only the right care, it’s better care. Rural communities are 

resourceful and continuity of care is primary to good outcomes such 

as avoidance of hospital re-admission. Investing dollars locally can 

save many more otherwise wasted dollars lost to inefficiencies, anonymity and the gaps that occur in the miles between. 

There is no doubt that rural health care delivery is challenging. 

Workforce shortages, older and poorer patient populations, geographic barriers, low patient volumes and high rates of publicly insured Medicare and Medicaid recipients, uninsured and underinsured populations are just a few of the barriers.1

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Unfortunately, a growing number of rural Americans are living 

in areas with limited health care options. Indeed, 81 rural hospitals 

have closed since 2010, leaving many rural Americans without 

timely access to emergency care. The two most recent of these, closing on June 30th of this year, are in Florida and Texas. The majority rural closures are in states that did not expand Medicaid, and 

with reductions in the Disproportion Share (DSH) payments that 

helped hospitals cover bad debts incurred by serving high rates of 

uninsured people, these hospitals could not survive.2, 3, 4, 5, 6 There 

are 673 additional rural hospitals that are on the brink of closure. 

The health disparities between rural populations and their urban 

counterparts are pronounced. This can be particularly true among 

the growing minority populations in rural America. A recent study 

in the Journal of Rural Health underscored the alarming extent of 

these challenges. 

Using data from the National Center for Health Statistics, and 

adjusting for age, the researchers found that rural whites have 102 

more deaths per 100,000 members of the population than their 

urban counterparts. Rural blacks have 115 more deaths per 

100,000 than their urban counterparts. The number of excess rural 

deaths from 1986 to 2012 was 694,000 for whites and 53,000 for 

blacks.7

Economic Impact of Rural Providers 

Rural health care providers are not only critically important for 

the health of rural Americans, the providers are critically important for the economic health of rural communities. 

Much of rural America was left behind in the economic recovery. 

According to the United States Department of Agriculture (USDA), 

rural counties were losing 200,000 jobs per year and the rural unemployment rate stood at nearly 10 percent during the Great Recession. Since then, economic recovery hasn’t returned to rural 

America. In fact, 95% of the jobs that have returned after the 

Great Recession have been to urban, not rural areas. 

While many industries in rural America have been shrinking, for 

a wide variety of reasons, health care is an industry with the potential to reverse declining employment. As factory and farming 

jobs decline, the local rural hospital often becomes the hub of the 

local business community—not only offering critical life-saving 

services, but representing as much as 20 percent of the rural economy. 

Simply put, hospitals provide a large number of jobs. The economic wellbeing of rural American towns depends on a healthy 

rural economy, which is anchored by the local rural hospital and 

local provider. The average Critical Access Hospital (CAH) creates 

195 jobs and generates $8.4 million in payroll annually. Rural hospitals are often the largest or second-largest employer in a rural 

co9mmunity (along with the school system). In addition, even a single rural primary care physician can generate 23 jobs and more 

than $1 million in annual wages, salaries and benefits.8

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Because hospitals provide so many jobs, it follows that their closure has a devastating effect on employment. If Congress allows 

the 673 additional vulnerable rural hospitals to shut their doors, 

99,000 direct health care jobs and another 137,000 community jobs 

will vanish. 

A critical component of maintaining economic stability in rural 

communities is ensuring that rural hospitals and other health care 

providers are able to remain in their communities. Protecting rural 

hospitals from closure is an immediate step that can be taken to 

prevent significant job loss in rural communities. 

Workforce challenges also exist in rural America. The rural 

health landscape with its uneven distribution and shortage of 

health care professionals is faced with significant problems in recruiting and retaining a trained health care workforce. This is compounded by the disparity in federal reimbursement for rural providers, which if addressed, would not only improve the recruitment 

and retention of rural physicians, but would also stabilize the rural 

economy. 

Providers are more likely to practice in a rural setting if they 

have a rural background, participate in a rural training program 

(RTT Technical Assistance Program) and have a desire to serve 

rural community needs. The RTT Technical Assistance Program 9

identified that residents training in rural training track residency 

programs were about twice as likely to practice in rural areas following graduation than family medicine graduates overall.10 Likewise, an emphasis on inter-professional education, rural medical 

school tracks, admission of rural and minority students to health 

professions education are all part of the workforce solution. Training doctors and other health professionals close to home makes it 

more likely they will call that place home. Investments in rural distributed medical education are supported by such programs as 

Area Health Education Centers (AHES),11 and supported by organizations such as the RTT Collaborative, a not-for-profit sustainable result of the RTT Technical Assistance Program. 

To train and educate physicians who will practice in rural, the 

presence of hospitals and clinics in these rural communities must 

be present to become part of the ‘‘rural medical education campus.’’ 

Distributed medical education campuses across rural states and 

rural America then become the platform for workforce initiatives 

that work, develop infrastructure to support quality healthcare delivery and produce economic value. Graduate medical education 

regulatory reform that allows for common sense investment specifically allowing for education of physicians in rural hospitals is one 

example of how to address rural economic development and workforce shortages in one action, while improving quality and delivering cost-saving healthcare. 

The Local Scale: How a Healthy Population Means a 

Healthy Economy 

The benefits of strong rural health care providers spread far beyond the number of people directly employed in a hospital. 

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Consider the case of Beatrice, Nebraska, a rural town in Gage 

County, Nebraska. The town has a burgeoning economy largely 

thanks to the Beatrice Hospital, a CAH with 25 beds, and its related health services. Beatrice is an example of how related health 

care services flourish when a strong local hospital is nearby. In Beatrice, home health services and assisted living homes have sprung 

up around the hospital to fulfill the necessary care for the town’s 

elderly (the town’s average age is six years higher than the state 

of Nebraska’s average age). 

Beatrice Hospital shows how significant the direct and indirect 

effects of a good hospital are for rural communities. Beatrice Hospital is the town’s largest employer with 512 workers. Its payroll 

is nearly $28 million, and the average starting salary for a nurse 

is $40,000. 

The wages provided by the hospital’s good jobs circulate throughout the local economy, stimulating small businesses, the local real 

estate market and more in a virtuous circle for the community. 

That’s why across the country, small rural towns like Beatrice, 

‘‘have emerged as oases of economic stability across the nation’s 

heartland.’’ 12

Rural hospitals provide other types of indirect stimulus as well. 

A hospital’s construction and maintenance requires non-hospital-affiliated labor and external contractors to complete. In order to build 

and maintain a hospital, and receive these benefits, investment in 

local resources and labor are necessary. 

One way to quantify the total impact of the indirect economic 

benefits of rural hospitals is using employment and labor multipliers. These multipliers are used to measure job and revenue creation upon the entrance of a hospital into a specific market. 

If a hospital has an employment or labor multiplier greater than 

one, it has a positive indirect economic impact. For instance, an 

employment multiplier of 1.35 would mean that a 100-employee 

hospital also creates 35 new, non-health-related jobs for local economy. The typical CAH has an employment multiplier of 1.38. 

An alternate approach is to look at the multiplier on wages and 

salaries. For instance, the average wages multiplier for rural hospitals is estimated at 1.24. That means that a rural hospital with 

$10 million in wages, indirectly generates an additional $2.4 million in local salaries and incomes outside the hospital. 

Consider what these multipliers mean for a hospital like the one 

in Beatrice. The 512-direct jobs generate 179-indirect jobs across 

the community. The $28 million in direct wages generates $6.7 million in additional wages throughout the community. 

And, in Apalachicola, Florida, the George E. Weems Memorial 

Hospital is a 25-bed Critical Access Hospital that not only provides 

dynamic health care services to Franklin County and the surrounding area, but it also has an employment multiplier of 1.40. 

The $1.8 million in local retail sales attributed to hospital generates significant sales tax collection. 

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The multipliers for other types of rural hospitals are similar. The 

economics are clear that rural hospitals are powerful engines for 

boosting job creation and increasing earnings across a rural community. 

Locating and Expanding Businesses in Rural 

The quality of a community’s local health care system is a key 

factor for firms that are considering where to relocate or expand. 

Access to quality health care is the number two priority for firms 

who are making decisions on relocation and expansion. The only 

thing more important to firms is having access to a skilled workforce. 

Without local access to care, the rural economy struggles to grow 

and thrive. When a community loses access to local health care, it 

affects the ability of all businesses in the community to go about 

their business and grow. It is difficult for companies to attract 

workers with young or expanding families when care for a sick 

child is not available locally, or if the family must travel hours for 

prenatal and maternity care. 

Knowing you have an emergency room nearby to treat your employees is essential for many businesses, especially within sectors 

such as farming or energy. The difficult work behind producing our 

food and energy supply is vital to our nation’s economy. This work, 

which must often be performed in rural and remote areas, has intrinsic risks and dangers. Workers in these vital sectors of the 

American economy need and deserve access to quality and affordable health care. 

Technology such as telemedicine for consultation services have 

supported rural delivery of care but depend on the adequate development of broadband internet into rural and remote areas. Networks developed for education and building technology-based ‘‘virtual communities’’ can share of best practices and an example such 

as with Project ECHO will continue to bring more support to rural 

hospitals and clinics. Still, hands-on care is needed when an unexpected car accident or early delivery of a newborn baby occurs in 

rural America, no matter if you are a local resident or visiting. 

Each one of us who spend time and dollars in rural communities 

will appreciate quality, local care in those moments. 

Access to health care is related to the sustainability of small 

businesses, another hallmark of healthy economies. A rural community simply cannot attract entrepreneurial investment and talent—or entice native talent to remain—without appropriate health 

services. Small business leaders contribute jobs and more circulating dollars, infusing rural economies with increased assets. 

Supporting the Whole Community 

The town of Jefferson, Illinois is a testament to the role of a hospital in economic growth. Rand Fisher, president of the Iowa Area 

Development Group, asserts, ‘‘To be successful in business development today, we believe you also have to be very focused on community development.’’ 

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Fisher is referring to the multi-pronged approach that development-minded communities must take. They must focus on industrial retention, recruitment and entrepreneurship, and community 

betterment that provides better access to education and health 

care. A rural hospital is one agent that fulfills all these roles. 

Jefferson is ‘‘drawing new residents and keeping existing ones 

through strong business and community development programs,’’ 

not least of which is its recent hospital renovation. A technological 

investment introduced state-of-the-art equipment and improved facilities that are better able to serve patients.13

Rural hospitals provide cost-effective primary care. It is 2.5 percent less expensive to provide identical Medicare services in a rural 

setting than in an urban or suburban setting. This focus on primary care, as opposed to specialty care, saves Medicare $1.5 billion 

per year. Quality performance measurements in rural areas are on 

par with if not superior to urban facilities. Additionally, CAHs represent nearly 30 percent of acute care hospitals but receive less 

than 5 percent of total Medicare payments. 

When a rural hospital closes or a physician leaves, businesses, 

families, and retirees are forced to leave. Often, rural physicians 

are hospital-based. When the hospitals close, the physicians leave, 

soon followed by nurses, pharmacists and other providers. Medical 

deserts are forming across rural America. Hundreds of rural jobs 

are lost, home values drop, and those who can’t sell their home are 

stuck in a dying town that can no longer meet their basic needs. 

A study shows that ‘‘the closure of a rural county’s sole hospital decreases the economic well-being of the community and likely places 

the local economy in a downward cycle that may be very difficult 

to recover from.’’ 14

All of these examples show why a strong rural health care system is vital to our states’ economies. The rural health care system 

provides a large number of direct jobs, a large number of indirect 

jobs, and provides key support for every business in a local community. We have seen the devastating impact that the Great Recession has had on rural communities across the country. Health care 

is one industry capable of playing a critical role supporting the 

local economy, and protecting rural communities from further economic damage. If roads and Internet access are the blood vessels 

and nerves, then health care is the backbone to investing in rural 

America. 

Recommendations 

When rural hospitals and providers thrive, so do the physical 

and fiscal health of the community. The following are NRHA’s recommendations: 

1. H.R. 2957, the Save Rural Hospitals Act. Passage of 

this important bill will provide immediate relief to rural hospitals by stopping the onslaught of reimbursement cuts that 

have hit rural hospitals. Without increasing reimbursement 

rates, it will stabilize payments and stop rural hospital closures. It will also create a new health care delivery model that 

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is flexible for the many varied needs in rural communities. 

Hospitals are essential to rural communities, not just for access to emergency care but for the high-quality jobs supported 

by the hospital. If the hospital closes, these rural communities 

will likely face higher poverty rates. 

2. Education: Continue to fund health workforce programs 

to not simply recruit individuals to rural areas but to reward 

those individuals that stay for extended periods of time in 

these communities. Regulatory reforms related to rural graduate medical education can have a near-term positive effect on 

workforce and rural economic growth. 

3. Rural Health Networks: Expand funding for the creation of rural health networks with the intention of identifying 

innovative strategies to expand services to all residents 

through access to quality care at a local integrated level, lower 

costs and a better patient experience. 

4. Research: The federal government should support research that explores the linkages between a strong healthcare 

system and sustainable local economies in rural communities. 

5. Technology Infrastructure: Provide access to capital 

through grants and loans for facilities to adopt new technology 

for Electronic Medical Records (EMRs) and to meet all stages 

of meaningful use. In addition, provide educational programs 

to train doctors, nurses and other staff not just how to use the 

technology but how to interpret the data and how to make recommendations for quality improvement. Broadband access in 

rural America teamed with health professions education access 

and ongoing support of practice reduces professional isolation, 

sustains workforce and improves quality. 

6. Telehealth: Rural providers and other agencies are seeking to implement new medical technologies to enhance quality 

and delivery of medical care. Telehealth is an example of one 

of the most important technologies for rural providers. In 2013, 

over 40,000 rural beneficiaries received at least one telemedicine visit, and this number is expected to continue to grow. If 

rural providers are to move toward an online future, they must 

invest in necessary technological infrastructure and systems. 

Government grants and private investment in technological advancements can increase the flow of new dollars into rural 

economies, empowering local resources to further health infrastructure. 

The National Rural Health Association appreciates the opportunity to provide our testimony and recommendations to the subcommittee. An investment in the rural health delivery system is 

important to maintaining access to high quality care in rural communities and to a healthy, vibrant economy. We greatly appreciate 

the support of the subcommittee and look forward to working with 

members of the subcommittee to continue making these important 

investments for rural America. 

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65 

SBREP-219A with DISTILLER


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66 

SBREP-219A with DISTILLER


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67 

SBREP-219A with DISTILLER


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68 

SBREP-219A with DISTILLER


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69 

SBREP-219A with DISTILLER


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70 

SBREP-219A with DISTILLER


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71 

SBREP-219A with DISTILLER


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72 

SBREP-219A with DISTILLER


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73 

SBREP-219A with DISTILLER


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74 

SBREP-219A with DISTILLER


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75 

SBREP-219A with DISTILLER


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76 

SBREP-219A with DISTILLER


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77 

SBREP-219A with DISTILLER


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78 

SBREP-219A with DISTILLER


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79 

SBREP-219A with DISTILLER


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80 

SBREP-219A with DISTILLER


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81 

SBREP-219A with DISTILLER


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82 

SBREP-219A with DISTILLER


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83 

SBREP-219A with DISTILLER


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84 

SBREP-219A with DISTILLER


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85 

SBREP-219A with DISTILLER


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86 

SBREP-219A with DISTILLER


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87 

SBREP-219A with DISTILLER


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88 

SBREP-219A with DISTILLER


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89 

SBREP-219A with DISTILLER


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90 

SBREP-219A with DISTILLER


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91 

SBREP-219A with DISTILLER


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92 

SBREP-219A with DISTILLER


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93 

SBREP-219A with DISTILLER


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94 

SBREP-219A with DISTILLER


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95 

SBREP-219A with DISTILLER


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96 

SBREP-219A with DISTILLER


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97 

SBREP-219A with DISTILLER


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98 

SBREP-219A with DISTILLER


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99 

SBREP-219A with DISTILLER


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100 

SBREP-219A with DISTILLER


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101 

SBREP-219A with DISTILLER


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102 

SBREP-219A with DISTILLER


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103 

SBREP-219A with DISTILLER


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104 

SBREP-219A with DISTILLER


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105 

SBREP-219A with DISTILLER


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106 

SBREP-219A with DISTILLER


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107 

SBREP-219A with DISTILLER


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108 

SBREP-219A with DISTILLER


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109 

SBREP-219A with DISTILLER


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110 

SBREP-219A with DISTILLER


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111 

SBREP-219A with DISTILLER


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112 

SBREP-219A with DISTILLER


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113 

SBREP-219A with DISTILLER


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114 

SBREP-219A with DISTILLER


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115 

SBREP-219A with DISTILLER


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116 

SBREP-219A with DISTILLER


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117 

SBREP-219A with DISTILLER


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118 

SBREP-219A with DISTILLER


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119 

SBREP-219A with DISTILLER


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120 

SBREP-219A with DISTILLER


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121 

SBREP-219A with DISTILLER


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122 

SBREP-219A with DISTILLER


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123 

SBREP-219A with DISTILLER


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124 

SBREP-219A with DISTILLER


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125 

SBREP-219A with DISTILLER


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126 

SBREP-219A with DISTILLER


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127 

SBREP-219A with DISTILLER


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128 

SBREP-219A with DISTILLER


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129 

SBREP-219A with DISTILLER


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130 

SBREP-219A with DISTILLER


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131 

SBREP-219A with DISTILLER


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132 

SBREP-219A with DISTILLER


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133 

SBREP-219A with DISTILLER


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134 

SBREP-219A with DISTILLER


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135 

SBREP-219A with DISTILLER


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136 

SBREP-219A with DISTILLER


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137 

SBREP-219A with DISTILLER


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138 

SBREP-219A with DISTILLER


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139 

SBREP-219A with DISTILLER


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140 

SBREP-219A with DISTILLER


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141 

SBREP-219A with DISTILLER


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142 

Æ 

SBREP-219A with DISTILLER


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