Department of Health and Human Services 

OFFICE OF 

INSPECTOR GENERAL 

ACCESS TO RURAL HEALTH CARE: 

SUCCESSFUL COMMUNITY INITIATIVES 

JULY 1993 
OFFICE OF INSPECTOR GENERAL 

The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, as 

amended, is to protect the integrity of the Department of Health and Human Services’ (HHS) 

programs as well as the health and welfare of beneficiaries served by those programs. This 

statutory mission is carried out through a nationwide network of audits, investigations, and 

inspections conducted by three OIG operating components: the Office of Audit Sewices, the 

Office of Investigations, and the Office of Evaluation and Inspections. The OIG also informs the 

Secretary of HHS of program and management problems and recommends courses to correct 

them. 

OFFICE OF AUDIT SERVICES 

The OIGS Office of Audit Services (OAS) provides all auditing semices for HHS, either by 

conducting audits with its own audit resources or by overseeing audit work done by others. 

Audits examine the performance of HHS programs and/or its grantees and contractor in carrying 

out their respective responsibilities and are intended to provide independent assessments of HHS 

programs and operations in order to reduce waste, abuse, and mismanagement and to promote 

economy and efficiency throughout the Department. 

OFFICE OF INVESTIGATIONS 

The OIGS Office of Investigations (01) conducts criminal, civil, and administrative investigations 

of allegations of wrongdoing in HHS programs or to HHS beneficiaries and of unjust enrichment 

by providers. The investigative efforts of 01 lead to criminal convictions, administrative sanctions, 

or civil money penalties. The 01 also oversees State Medicaid fraud control units which 

investigate and prosecute fraud and patient abuse in the Medicaid program. 

OFFICE OF EVALUATION AND INSPECTIONS 

The OIGS Office of Evaluation and Inspections (OEI) conducts short-term management and 

program evaluations (called inspections) that focus on issues of concern to the Department, the 

Congress, and the public. The findings and recommendations contained in these inspection 

reports generate rapid, accurate, and up-to-date information on the efficiency, vulnerability, and 

effectiveness of departmental programs. 

OEI’S Atlanta Regional Office staff prepared this report under the direction of Jesse J. Flowers, 

Regional Inspector General and Christopher Koehler, Deputy Regional Inspector General. 

Principal OEI staff included: 

Atlanta Region Headquarters 

Maureen Wilce, Project Leader Cathaleen Ahern


Ron Kalil


Paula Bowker


Ruth Reiser


For additional copies of this report, please contact the Atlanta Regional Office at 404-331-4108.

Department of Health and Human Services 

OFFICE OF


INSPECTOR GENERAL


ACCESS TO RURAL HEALTH CARE:


SUCCESSFUL COMMUNITY INITIATIVES


JULY 1993 OEI-04-92-00730

EXECUTIVE SUMMARY


PURPOSE 

To describe successful initiatives for providing access to health care in rural communities 

that do not have a local hospital. 

BACKGROUND 

Many changes in the provision of medical care have resulted in an increase in hospital 

closure. Specialization and advanced technologies have drastically changed the patterns 

of care at hospitals. Occupancy rates at hospitals have decreased as many procedures 

are treated with shorter inpatient stays. Further, procedures once requiring inpatient 

stays can now be performed on an outpatient basis. Likewise, improved mobility of those 

living in rural areas has contributed to closures of local hospitals. Rural residents can, 

and often do, bypass local hospitals to obtain more specialized care that is typically 

available in larger regional or urban hospitals. Nationally, 193 rural hospitals closed 

during 1987 through 1991. This is 7.1 percent of all rural hospitals that were open in 

1987. 

The closure of local hospitals had limited effect on access to medical care for most 

people. Most communities where a hospital closed were within 20 miles of another 

hospital. However, communities without a nearby hospital and certain populations within 

the communities, such as the poor and elderly, can have problems accessing health care 

services. The hospital closures have led to strong interest in providing health care locally 

without a hospital. This desire of local communities to take responsibility for their own 

health care needs was recently endorsed by the Secreta~ of Health and Human Services. 

She expressed her intent to help rural communities empower themselves to meet their 

own health care needs. 

SCOPE AND METHODOLOGY 

We surveyed health professionals in 39 States where one or more rural hospitals had 

closed to identify communities that had developed a successful initiative for providing 

health care after their hospital had closed. We selected six initiatives for case study. We 

visited each selected community and described each of their initiatives and compared and 

contrasted the services provided. 

FINDINGS 

Rural commundia can empower themselves to create succewfid health care initiatives 

The six initiatives we selected for this study demonstrate commitment, hard work, and 

creativity to provide access to health care locally. Once communities accepted their 

inability to sustain a hospital, they created an alternative which reflected individual needs 

i 
--

and resources within a community. Often, traditional community boundaries had to be 

ignored to create a successful health care initiative. Thereafter, the community must 

support the initiative or it too will fail as have many small rural hospitals. 

Successjhl initiatives can irnpmve ddwy of health care senices 

Through their initiative, the communities we selected generally improved the supply of 

health care professionals. They established (1) programs to attract health care 

professionals to their community, and (2) networks to share health professionals between 

communities. Likewise, they tailored health care to their community eliminating 

duplication and underused services. 

Sttwasskance is*al fw succiwjid cornrrudy hitiiztiveis 

State governments provided grants and technical assistance. Further, States revised 

legislation and policies to allow communities to develop and operate their health care 

initiatives. 

Local commudies relied on exhting Federal programs h developing their ikitidves 

Virtually all of the initiatives relied on existing Federal programs, such as Medicare and 

Medicaid, for funding and technical assistance. To illustrate, Newton, Texas, Ekalaka, 

Montana and Oxford, Nebraska received Medicare and Medicaid reimbursements as part 

of the existing Rural Health Clinic program. Significantly, no community initiative was 

funded through new Federal programs. 

CONCLUSION 

Rural communities where hospitals have closed and those that are trying to save a failing 

hospital can find other ways to meet their health care needs. Local residents who accept 

the notion of health care without a hospital can empower themselves to design and 

implement a strong health care system for their communities. The success of local health 

care initiatives depends heavily on creative use of all available resources by community 

leaders. A community must first obtain strong local support and then seek available 

State and existing Federal support. 

ii 
TABLE OF CONTENTS


PAGE 

EXECUTIVE suMMARY


INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...1


FINDINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...4


Communities Empowering Themselves . . . . . . . . . . . . . . . . . . . . . . . . . . . ...4


Improving Delivery Of Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...8


State Assistance Is Critical . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...10


Using Existing Federal Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...10


CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...11


APPENDIX : DESCRIPTION OF COMMUNITY INITIATIVES . . . . . . . . . . . A-1


Newton Education Center, Newton, Texas . . . . . . . . . . . . . . . . . . . . . . . . ..A-2


Rural Health Clinic, Lewisville, Arkansas . . . . . . . . . . . . . . . . . . . . . . . . . ..A-4


North Penal Oreille Health Semices Consortium,


Metaline Falls, Washington . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..A-6


Oxford Medical Center, Oxford, Nebraska . . . . . . . . . . . . . . . . . . . . . . . . . . A-8


Jane Phillips Community Health Clinic, Caney, Kansas . . . . . . . . . . . . . . . . A-10


Medical Assistance Facilities, Circle, Ekalaka,


Jordan, and Terry, Montana . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..A-12

INTRODUCTION


PURPOSE


To describe successful initiatives for providing access to health care in rural communities


that do not have a local hospital.


BACKGROUND


Changes In The Provision of Medical Care Contrhte to Hospital Closures


Significant changes in provision of medical care in recent years have resulted in an


increase in hospital closures. The once prevalent general practice of medicine has


Yielded toincreased specialized care. Specialized care requires advanced technologies


plus physicians andother medical professionals whoaretrained to use it. Likewise, the


improved mobility of people in rural areas further contributed to hospital closures. The


availability of automobiles and interstate highways allows rural citizens easy and fast


access to hospitals and other medical services in distant locations. People in rural


communities can, and do, bypass a local hospital to obtain more specialized care that is


typically available in larger, more urban locations. Advances in emergency ambulance


services also allow bypassing a local hospital even in emergency cases.


Our study of hospital closures during 1987 through 1991 showed that 193 rural hospitals


closed nationally (“Trends in Rural Hospital Closure: 1987-1991” 0EI-04-92-O0441).


This is 7.1 percent of all rural hospitals that were open in 1987. The majority of the


hospitals that closed were small and had low occupancy rates.


Hospital Closures Had Limited Effect on Access to Medical Care


The closures of local hospitals had limited effect on access to medical care for most


people. In our five years of hospital closure studies, we found that for most


communities, hospital care was still available within 20 miles. Further, the Office of


Inspector General reported on the effects of hospital closure on access to hospital care in


1990 (“Effects of 1988 Rural Hospital Closures on Access to Medical Care,” 0EI-04-89-


00742). In the 1990 study we found that most residents did not use the local hospital


before it closed. Residents chose to bypass the local hospital, and perhaps other small


rural hospitals, to travel to newer, larger and more specialized facilities. The study


showed that, overall, most residents did not have serious problems accessing health care


as a result of hospital closure. Although many residents in communities which lost their


hospitals had inpatient and emergency care available nearby, some residents had


problems accessing medical care.


1

Interest In Providing Hezdth Care Without A Hospital


During ourevaluations ofhospital closuresin 1987 through 1991, many Federal, State


and local health care providers expressed interest in how communities successfully meet


health care needs without a hospital. They wanted to know what communities had done


to continue providing health care in their communities when their hospital closed.


Further, they wanted to know if the techniques used by these communities could be


applied in other communities, including communities facing hospital closure, and


communities which have never had a hospital. Finally, Dr. Shalala, Secretary of Health


and Human Services, recently expressed her strong intent to help rural communities


empower themselves to meet their own health care needs.


This report provides information on initiatives developed by selected communities to


successfully meet their health care needs. We believe examination of the successful


community initiatives will help decisionmakers at the Federal, State and local level design


policies and programs to meet local health care needs during a period when the


provision of, cost of, and access to health care are changing drastically.


SCOPE AND METHODOLOGY


We interviewed State health and hospital officials and health care advocates in 39 States


where one or more rural hospitals had closed. We obtained information on (1) what


specific rural communities had done to provide local access to health care following


closure of their hospital, and (2) what standards and characteristics indicated successful


initiatives in those communities. We then interviewed State health professionals,


researchers, and other officials in State and national organizations that have an interest


in rural health issues to identify communities they believed had developed successful


health care initiatives. They identified 18 rural communities.


To determine the types of health care provided, we interviewed, by phone, community


health officials in each of the identified rural communities. We classified each


community initiative based on extent and level of health care services provided. We then


selected six initiatives which (1) met our standards for a successful initiative, (2)


represented different types of initiatives, and (3) gave geographic dispersion among rural


communities that had developed initiatives.


We visited each of the selected six communities to (1) document the services actually 

provided, and (2) obtain information on the development and operation of the initiative. 

We obtained information by interviewing the administrator, health care professionals, 

former hospital administrators and staff, board members and community leaders, and by 

reviewing hospital and community records. Where appropriate, we also interviewed State 

officials who were involved in the transition from a closed hospital to an alternate 

method (initiative) of providing health care. Finally, we compared and contrasted the 

development and operations of the six selected community initiatives (see Appendix A). 

2

We collected and analyzed information during June 1992 through March 1993 to identify 

successful community initiatives for providing local health care when a hospital closes. 

We conducted this inspection in accordance with the Quality Standards for Inspechons 

issued by the President’s Council on Integrity and Efficiency. 

3

--

FINDINGS


RURAL COMMUMHES CAN EMPOWER THEMSELVES TO CREATE 

SUCCESSFUL HEALTH CARE INITIATIVES 

Initiatives Reflect Individual Cmmmnity Needs And ResourCes 

Each of the six initiatives we selected reflected the varied needs and resources within a 

community. We briefly summarized each of the six selected case examples below. 

Q


The Newton County Education Center: This initiative includes a 

wide mix of (1) public health services, including immunizations and 

well-child care provided by nurses, (2) a Rural Health Clinic (RHC) 

where a physician provides basic primary care including lab and xray services, (3) vocational educational services provided by county 

school system employees at the initiative site, and (4) a day care 

center. The center is located in the former Newton County 

Memorial Hospital at Newto~ Texas. It is administered by Jasper 

Memorial Hospital, located in a neighboring county. 

The Rural Health Center: The center is located in Lewisville, 

Arkansas. The initiative is intended to be a “one-stop shopping” 

center for health care. When completed, it will combine health care 

and social services. The clinic provides basic primary care, lab, xray, and public health services. Four part-time physicians, several 

nurses, a visiting nurse pediatrician, and a nutritionist staff the clinic. 

Renovations are underway to include county social services at the 

center. The clinic also operates a satellite clinic two days a week in 

another community that is 18 miles away Bradley, Arkansas. The 

center is located in the former Lafayette County Memorial hospital. 

The North Penal Oreille Health Services Consortium: The 

Consortium is located in Metaline Falls, Washington. The 

Consortium of health care providers is centered around a RHC, 

located in nearby Ione, Washington. The consortium provides 

primary care, emergency care services, transfer agreements with the 

nearest hospital, case management and referrals, home health 

services, psychiatric services through a nurse practitioner, and a van 

to provide non-emergency transportation for handicapped persons. 

The clinic is staffed by a full-time physician, one physician assistant, 

and three part-time health care assistants. 

4

The Oxford Medical Center: Thecenter islocatedin Oxfor& 

Nebrakka. Community leaders and board members of the Fritzer 

@6~ealth center inxford established an 

affiliation with a neighboring hospital in Cambridge after the 

hospital in Oxford closed. The Cambridge hospital already had four 

satellite clinics. They converted the closed hospital in Oxford into a 

fifth clinic. The clinic, which is a RHC, is staffed by a full-time 

physician assistant. Three physicians visit weekly from the affiliated 

hospital. The clinic offers general, family practice services, lab, xray, on-call urgent care after hours, emergency transportation 

through a volunteer EMT service and helicopter transport, a van 

service to nearby hospitals, health education, and a pharmacy. 

The Jane Phillips Community Health Clinic: The clinic is located in 

Caney, Kansas. Because of serious financial problems, the 

administrator of the Caney Hospital, an acute care facility, started 

planning for continuation of health care before the hospital closed. 

She obtained agreement with the Jane Phillips Episcopal Memorial 

Hospital in nearby Bartlesville, Oklahoma to provide medical 

support services. The Caney Clinic provides offices for three 

physicians (although at present, only two practice at the clinic) and a 

part-time physician assistant. The initiative provides primary care, 

lab services, an optician’s office, 24-hour urgent care, and emergency 

transportation to the hospital in Bartlesville. It is also planning to 

house the town’s remaining pharmacy. The Jane Phillips Hospital 

was already serving as a hub for supporting medical facilities in 

several other communities. Because of the upfront planning, the 

Jane Phillips Clinic opened and began providing semice on the 

Monday following closure of the Caney Hospital on Friday. 

The Medical Assistance Facilities: The Medical Assistance Facilities 

are part of a demonstration program in Montana sponsored by the 

Heath Care Financing Administration, Department of Health and 

Human Services. Four rural Montana communities, Circle, Elcal@ 

Jordan and Teny, are participating in the Federal demonstration 

Medical Assistance Facility program. The Medical Assistance 

Facilities offer low-intensity inpatient care, 24-hour emergency care 

and outpatient medical services, including basic laboratory and x-ray 

services. All MAFs are currently staffed by physician assistants. 

One community, Circle, also has a physician on site. In addition, all 

of the MAFs share facilities with nursing homes, and all have 

transfer protocols established with full-semice hospitals. See OIG 

report number OEI-04-92-00731 for further details on The Medical 

Assistance Facility demonstration program. 

5

Each of the rural communities above is similar to many other rural communities, where a 

hospital closed. ~ehospitals e~etienced adowward spiral inoccupanq, la~ing 

revenues and rising costs. The communities feared that when their hospital closed, the 

citizens, particularly the poor and elderly, would have unnecessary difficulty obtaining 

access to health care. Because they realized that their community could not support a 

full service hospital, the communities found other alternatives for meeting their health 

care needs. 

Cmmmmity Residents Must First Amept That They Can Not Sustain A Hospital 

Many community leaders and residents believe that a hospital is essential for access to 

health care. Even when a hospital is under-used, a community will often take extreme, 

costly measures to t~ and save their hospital. They are proud of their hospital and 

believe it will keep medical professionals in the community. For example, despite great 

cost, Metaline Falls, Washington maintained its former hospital building for three years. 

They hoped that eventually they could reopen the hospital. Trying to keep its hospital 

open, Oxford, Nebraska passed two bond issues totalling one half million dollars. Both 

communities are now faced with paying the debt plus interest. 

The first step in developing a successful initiative for providing local health care through 

means other than a hospital is acceptance that the community can not sustain a hospital. 

In some communities that we visited, this acceptance started with one individual who 

believed something else could be done. In other communities a group of people, such as 

the hospital board of directors, saw that closure of their hospital was unavoidable. 

Thereafter, they provided the leadership in creating an alternative way to provide access 

to health care in their community. 

Community Teamwork And Planning Are Critical For A Sueeessful Initiative 

People in each of the communities we selected for study had obtained cooperation and 

assistance from throughout the community in planning and developing their successful 

initiative. Although State and Federal financial and advisory support helped several of 

the communities, local people conceived, designed and led development of their 

successful initiative. 

Each community determined their own health care needs and worked cooperatively in 

designing and implementing a plan to meet those needs. Some communities adopted a 

very structured approach. For example, Metaline Falls, Washington followed a formal 

process developed by the Area Health Education Center. First, the community leaders 

accepted the closure of their hospital and agreed to start planning for providing health 

care in the absence of a hospital. Second, they obtained a professional facilitator to lead 

them through a needs assessment process. Third, the community board designed an 

alternative (the initiative) for providing health care in the absence of a hospital. Finally, 

the community leaders worked cooperatively in implementing the initiative. As new 

health care needs arise and additional resources are generated, the community expects to 

repeat the process. Other communities used a less structured approach, but teamwork 

6 
and planning were very important. For example in Caney, Kansas the hospital


administrator worked with the administration of the Jane Phillips Hospital in Bartlesville,


Oklahoma directly to develop plans for the initiative.


Ignoring Traditional Community Boundaries May Be Essential For A Sueeessful Initiative


Local people in all of the communities selected for our study had to change the


definition of their community in order to successfully provide local access to health care


for their citizens. They had to redefine the community boundaries in terms of who would


be served by the health care initiative. For example, Lewisville, Arkansas redefined its


boundaries for health care to include the southern part of the county near Bradley,


Arkansas. Likewise, In Caney, Kansas the local people decided to become a part of a


larger community for health care that crossed the State boundary into Oklahoma. In


Oxford, Nebraska rivalries which had existed between small neighboring towns were


changed into alliances in order to develop a new local health care arrangement. Finally,


in defining their community for health care purposes, Newton and Jasper, Texas realized


that their football team rivalries did not have to extend to the health care system. One


initiative director said “cooperating with other communities is the key” for a successful


alternative to hospital care. A State Commissioner of Health said “they put aside their


personal and political differences and demonstrated an all-too-rare kind of cooperation.”


By deciding to redefine their boundaries, communities were able to establish networks for


successfully providing access to quality health care. The networks between communities


allowed an individual county to access a wider range of health care services and


resources than those that were available through the former small hospitals. To


illustrate, the Rural Health Clinic in Metaline Falls, Washington could not provide all the


services needed such as home health, psychiatric care, and transportation. By


establishing a network with health care providers in neighboring counties, Metaline Falls


was able to obtain those services. Likewise, citizens of the neighboring counties can


benefit from services offered in Metaline Falls.


Community Support Is Vital To Maintaining A Successful Health Care Initiative


No initiative could be successful if community residents chose not to use the services


offered. Although record keeping systems were not comparable, all initiatives appeared


to be prospering and growing in the communities we studied. For example, in Metaline


Falls, Washington the average number of patients per month at the Rural Health Clinic


doubled in the first two months after the physician arrived. In Oxford, Nebraska 1100


new patients have been added since the initiative opened in January of 1990. Also, a


new doctor is presently being recruited. A physician assistant at a Medical Assistance


Facility in Montana said, “the community has been very supportive. They feel confident


in the care we provide. If they feel they’d get second-rate care, they’re going to drive


those 50 to 80 miles” to another source of care.


The communities also support their initiatives in other ways, For example, some


communities support the initiative with local tax dollars. Others had fund-raising events


7 
to support their health care initiative. All communities we studied tried to win back 

residents who did not use the local hospital before it closed or obtained service of other 

communities after the hospital closed. They worked hard to communicate a message that 

the new health care facility was reliable, and that it was a high quality source of health 

care. They published stories about the new facilities, the physicians, and other health 

care providers working at the initiatives. The initiative in Metaline Falls, Washington for 

example, publishes a monthly newsletter to inform the community residents of initiative 

activities. One registered nurse said, “people aren’t going to let it (the initiative) stop. 

They saw the problem and want to help.” Local newspapers also helped support the 

community initiatives by publishing articles. 

SUCCESSFUL INITIATIVES CAN IMPROVE DELIVERY OF HEALTH CARE 

SERVICES 

Initiatives Increased The Supply Of Health Care Professionals 

All of the communities that developed a health care initiative had lost physicians and 

other health care professionals. Such losses clearly contributed to the eventual close of 

rural community hospitals. Therefore, a major objective of most of the community 

initiatives we examined was to recruit and retain health care professionals. For example, 

community leaders in Lewisville, Arkansas worked with the Area Health Education 

Council to establish a residency program for physicians at the clinic. The work at the 

clinic served to meet physician residency requirements. The residency program is 

expected to provide a constant supply of physicians in the community, while allowing 

medical residents valuable experience in providing rural health care. The Caney, Kansas 

community was able to recruit a new doctor because of an initiative arrangement which 

allowed staff privileges for physicians at the Bartlesville, Oklahoma hospital. 

The supply of health care professional was also increased through community networking 

for health care services. To illustrate, the network among communities broadened the 

base of doctors for consultation. It also broadened the base of health professionals for 

back-up. For example, one physician in a community did not have to be on call 100 

percent of the time. The community could spread the on-call duty to all physicians in the 

network. One initiative director said that “one of the biggest benefits of the consortium 

is having someone else to call on for help not only with health care, but also with 

computer problems.” This arrangement allowed physicians and other health care 

professionals some free time to pursue their own interest. Some physicians and health 

care professionals used that time to upgrade their skills. For example, two directors of 

the nursing staff told us their staff have upgraded their skills to respond to the wide 

variety of services needed in rural communities. 

Health Care Servkxs Were Tailored To Cmmmnity Needs 

Local people tailored their initiatives to meet their community needs. They chose what 

services the community could provide and what services would be obtained outside the 

community. For example, while all communities wanted physicians for general medical 

8 
practice, they could notalways afford them. Instead, several employed physician


assistants. Likewise, all communities wanted to provide emergency care. To do so, some


used an emergency room of a former hospital, but other communities established


arrangements with nearby community hospitals and referred patients as needed. Further,


all communities established agreements for air and road ambulance services to transport


patients to appropriate emergency facilities.


One community, Metaline Falls, Washington established a “911” system. Through the 911


system, the community can provide 24-hour-a-day emergency selvice. The 911


monitoring equipment is located at the clinic during the normal work day, and volunteers


take it home with them at night to monitor emergency calls.


Unlike hospital requirements which dictate how resources will be used, community health


care initiatives are flexible. They allow any services needed by a community to be added


if resources are available, and to be eliminated when the services are no longer needed.


For example, the Newton, Texas community initiative included using resources provided


by the school system to offer vocational education and day care services. Several


communities, including Ltnvisville, Arkansas, Circle and Ekalaka, Montana, Newton,


Texas, Metaline Falls, Washington and Oxford, Nebraska, added non-emergency


transportation services to their initiative. The local hospital could not have provided such


services as easily as the community added them. Several community initiatives included


using the former hospital kitchen to prepare meals for a meals-on-wheels program for


senior citizens. Finally, each of the Medical Assistance Facilities in Montana offered a


dental clinic one day a week.


Such flexibility enables community initiatives to continue changing as needed to meet


community health care needs. Oxford, Nebraska, for example, is currently planning an


expansion of its health care services. Likewise, the Lewisville, Arkansas community


expects to add another wing to its facility and to add county social services, such as public


assistance offices. Also, the Newton, Texas community is planning to include another


community, Kirbyville, Texas, into its network initiative for health care. The hospital in


Kirbyville, a small rural town, closed in 1988. After observing the effectiveness of


Medical Assistance Facilities in four rural Montana communities, Culbertson, Montana


recently converted its small hospital to a Medical Assistance Facility. One board


chairman of a rural community initiative told us, “we used to talk survival. Now we talk


about expanding services and updating equipment.”


Successful Initiatives Eliminated Duplicative And Underused Services


By tailoring health care sexvices to meet their needs, the six initiatives we analyzed


eliminated services that local people were not using, and those that were available to the


community from other sources. All initiatives except MAFs eliminated inpatient care.


The MAFs we visited had eliminated surgical care. Residents who need this type of care


are transferred from the initiative to a hospital.


9

The community initiative designers deleted services that were once provided by the 

former hospital, but not used by the community. For example, in Lewisville, Arkansas 

the former hospital provided pharmacy services. In developing its initiative for health 

care after the hospital closed, the community did not include pharmacy services. Instead, 

the community issued vouchers for patients to use at private pharmacies in town where 

adequate selvice was available. Likewise, in Caney, Kansas before the hospital closed, it 

operated seldom-used and outdated laboratory and x-ray services. Both services were 

eliminated when Caney developed its initiative for providing access to health care after 

its hospital closed. They dropped the services because they could get the same services 

at better quality from the Bartlesville, Oklahoma hospital which was only about 18 miles 

away. 

STATE ASSISTANCE IS CRITICAL FOR SUCCESSFUL COMMUNITY 

INITIATIVES 

Support from State governments has been vital to the development and operations of 

some community initiatives. For example, State health departments and special task 

forces in Montana, Washington and Arkansas have supported local community initiatives 

through technical assistance and grants. 

Further, some community initiatives required State legislation. Montana, for example, 

had to change its State law to expand the role of non-physician health care providers 

before communities could implement the Medical Assistance Facilities program. The 

State of Kansas revised its policies on Medicaid reimbursement to allow the partnership 

between Caney, Kansas and the Bartlesville, Oklahoma hospital. Likewise, as part of its 

managed care program, Washington State policy would have caused Metaline Falls, 

Washington Medicaid patients to be sent to health care providers in another community. 

However, the policy was changed and the patients are selved through the Metaline Falls 

health care initiative. 

LOCALCmmmwmm RELIED ON EXISTING FEDERAL PROGRAMS TO 

DEVELOP SUCCESSFUL INITIATIVES 

As is true of virtually all health care programs, the six initiatives we examined relied on 

existing Federal programs to a large extent. Of particular significance, none of the 

community initiatives were funded through new Federal programs. To illustrate, Newton, 

Texas, Ekalaka, Montana and Oxford, Nebraska received Medicare and Medicaid 

reimbursements as part of the existing Rural Health Clinic program. The network of 

clinics which includes Lewisville, Arkansas, uses existing funds available under the 

Community Health Center program. 

Other Federal health programs were used by several communities to help fund special 

projects. For example, Ekalaka, Montana used a Rural Transition Grant to design and 

plan a satellite clinic in the south end of the county. For the Medical Assistance 

Facilities program in Montana, the Health Care Financing Administration provided 

funding and approved waivers under a demonstration program. 

10 
CONCLUSION


Rural communities concerned about access to health care can find other ways to meet 

their health care needs without a hospital. Local residents who accept the notion of 

health care without a hospital can empower themselves to design and implement a strong 

health care system for their communities. The success of local health care initiatives 

depends heavily on creative use of all available resources by community leaders. A 

community must first obtain strong local support and then seek available State and 

Federal support. 

This desire of local communities to take responsibility for their own health care needs 

was recently endorsed by Secreta~ Shalala. She expressed her intent to help rural 

communities empower themselves to meet their own health care needs. 

We believe many other rural communities could follow the same processes described in 

our report to develop an initiative to meet health care needs. 

11

APPENDIX A


DEXRIPTION OF COMMUNITY INITIATIVES 

Newton, Texas: Newton Education Center 

Lewisville, Arkansas: Rural Health Clinic 

Metaline Falls, Washington:	 North Penal Oreille Health 

Services Consortium 

Oxford, Nebraska: Oxford Medical Center 

Caney, Kansas:	 Jane Phillips Community 

Health Clinic 

Circle, Ekalaka, Jordan,


and Terry, Montana: Medical Assistance Facilities


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Newton Education Center 

Newto~ Texas 

What is the initiative? 

The Newton Education Center offers a variety of services, including a rural health clinic, 

public health services, educational programs, and community services at the former 

community hospital. 

What was the hospital like before it closed? 

The occupancy rates at the Newton County Hospital had been steadily declining before 

its closure in 1989. The hospital had been built eighteen years earlier, under a HillBurton loan. Virtually all physicians in the community had ceased practicing at the 

hospital and services were seriously reduced. Other doctors in the Newton area did not 

refer patients to the hospital. Most people traveled to other hospitals in Jasper, 12 miles 

away, or in Beaumont, 60 miles away. County funds supported the hospital, but could 

not continue indefinitely. The hospital closed when the last doctor working at the 

hospital resigned and ceased practicing in the community. 

How was the successji.d initiative developed? 

When the hospital closed in 1989 the county was faced with nearly a half million dollar 

debt and penalties owed for defaulting on the Hill-Burton loan. A new county judge 

searched for a way for the county to fulfill an indigent care commitment. A vocational 

teacher, who was also a former hospital board member, was searching for a way for the 

community to provide a program to help teen mothers stay in school and learn parenting 

skills. Grant money for a teen parent program was available from the State, but there 

was no space to operate the program. The teacher obtained a State grant and part of 

the former hospital was renovated for classrooms and a day care center. As this was 

happening, the not-for-profit hospital in Jasper hired a new administrator who had run 

satellite rural health clinics before. The former hospital board in Newton and the former 

board of another closed hospital in Kirbyville approached the Jasper hospital 

administrator about opening rural health clinics (RHCS) in their former hospitals. The 

hospital in Newton was county property, and the county judge obtained agreement to 

convert part of the former hospital building into a RHC. The RHC opened as part of 

the Newton Education Center in February 1992. The county health district needed a 

larger space and also moved into part of the former hospital. 

What services does the initiative provide? 

The Newton Education Center operates a RHC, public health services, transportation


services, and educational services. The RHC provides basic primary care, normal


doctor’s office services from 8:00 am to 5:00 pm, five days a week. As part of the RHC


basic lab and x-ray services are available. A doctor from Jasper Memorial Hospital staffs


the clinic. The Newton Education Center provides public health semices, such as


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immunizations, Women and Infant Care (WIC) services, and well-child care. As part of 

the health services provided by the RHC and public health offices, people needing 

hospitalization or more specialized care are referred to Jasper Memorial Hospital or 

other hospitals in Beaumont, Houston or Galveston. 

The Newton Education Center provides limited van service to transport people in need 

of care to the RHC, and to affiliated community health clinic and referral hospitals. 

The county school system funds many educational programs operated at the Newton 

Education Center. The program for teen mothers opened in August 1990. It provides a 

place for pregnant students to continue high school, learn parenting skills, and train for 

careers in child care. A day care center that is open to the public provides a needed 

community service. Newton Education Center also offers other vocational programs. 

For example, a food education program is offered in the former hospital kitchen. The 

food education program provides training for careers in food service. It also provides 

meals to the elderly that are distributed through a meals-on-wheels program. The Center 

built a horticultural education center in the field adjacent to the center. It provides 

training while growing food for meals programs. The horticulture center is partially 

funded through a contract to provide plant care at county offices. Newton Education 

Center also provides special education for students with learning disabilities. The Center 

plans to use former hospital equipment for training material and add health service 

career programs. 

How has the initiative ajfected community health care needs? 

Many people who had to travel to get care in other places are now able to get care 

locally. Newton residents and patients from a 50-mile radius come to the busy clinic. 

Since the clinic physician is on staff at a hospital, referral for care is facilitated. 

Additional benefits result from offering a range of services in one location like the 

Newton Education Center. For example, teen mothers get prenatal care, health 

education, and WIC services while participating in a stay-in-school program. Their 

children, and other children in a day care center, have access to medical professionals 

whenever necessary. A food setice program provides a nutritional diet directly to the 

elderly in the community. Secondly it teaches students about the importance of 

nutritionally balanced diets. The horticulture program supplies some fresh foods for 

better nutrition, and education on how agriculture processes can affect health. 

The Newton Education Center, as part of the health care network with Jasper Memorial 

Hospital, refers many patients to the hospital. As the patient base expands at Jasper 

Memorial Hospital, the hospital is able to add staff and state-of-the-art medical 

equipment. This results in the community of Newton having access to a more 

sophisticated hospital just 12 miles away. 

Contact: James Singletaxy, Newton Education Center (409/379-2522), or Ernie 

Domenech, Administrator, Jasper Memorial Hospital (409/384-5461). 

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Rural Health Clinic 

Lewisville, Arkansas 

What h the initiative? 

The Rural Health Clinic is a community health clinic and the local health department 

sharing the former hospital building. The clinic serves primarily Lafayette County, an 

area of about 10,000 people. A satellite clinic is located in the southern part of the 

county in Bradley. The board for the initiative has plans to include county social services 

into the building to create a “one-stop shopping center.” 

What was the hospital like before it closed? 

For several years before its closure in 1987, Lafayette Memorial Hospital had lost 

physicians and was forced to reduce semices. The hospital had downsized, but still had 

an occupancy of only eleven percent. Several larger hospitals that are located about 25 

miles away in surrounding counties offered more specialized care. Most people who 

were able to travel to any of these other hospitals did so, leaving Lafayette Memorial 

Hospital serving primarily elderly and poor patients. Despite low use, community leaders 

desired to keep the hospital open. The county levied a one percent sales tax to support 

the hospital, and the hospital board developed plans to convert part of the hospital into a 

rehabilitation facility. The plans failed and the hospital closed. After the hospital closed, 

all but one physician ceased practicing in the county. 

How was the initiative developed? 

Prior to closure, a group of concerned community leaders formed a board to plan for 

county health care needs. They sponsored a needs assessment which showed that the 

county was one of the poorest and most underserved in Arkansas. 

At the same time, the State Health Department formed a State Committee on Indigent 

Health Care to give a rare surplus of Medicaid money as grants to needy communities. 

The Lewisville board asked State health officials for a grant and technical assistance in 

planning. Together, they developed a plan to combine a health care center with a social 

services center to create a one-stop-shopping center to provide care for the poor. The 

board received a State grant of over $600,000 to renovate and staff a medical clinic in 

the former hospital facility. 

The Rural Health Clinic needed a constant supply of operating funds. Several nearby 

counties belonged to a network of community health clinics, called Cabun. The Cabun 

network participates in the Federal Community Health Clinic (CHC) program. To 

obtain CHC funds the clinic at L.ewisville joined the network. Cabun handles the 

administration, quality assurance and supervisory work involved in running the clinic. 

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The State-run health department which had offices located in Lewisville had outgrown its


old offices and needed a larger facility. The State Health Department area


administrator, working with the community, obtained a State grant to renovate part of


the hospital building for use as State Health Department offices.


WL$atservices does the initiative provtie? 

The Rural Health Clinic provides basic primary care, normal doctor’s office services from 

8:00 am to 5:00 pm for five days a week. Basic lab and x-ray services are available. 

Public health nurses at the Clinic also provide services such as immunizations and wellchild care. A visiting pediatric nurse and nutritionist supplement care. The Clinic 

coordinates home health semices that are provided through the State health department. 

The Clinic provides van service to bring people without transportation to the Clinic or 

transfer them to their choice of hospitals. The Clinic will include county social services 

when a new wing is built onto the former hospital building. 

The Rural Health Clinic also staffs and administers a satellite clinic, which is located in 

the southern part of the county in Bradley, Arkansas. Several years ago, a large hospital 

in Louisiana donated an equipped trailer to be used as a clinic in the very undersexed 

Bradley area. Now all services provided in Lavisville are also provided on a part-time 

basis in Bradley. The high volume of patients has outgrown the trailer, and needs to be 

expanded. The Lewisville board is applying for a State grant to build a permanent 

facility. 

Currently, four doctors, including one pediatrician, work part-time at the Clinic. The 

doctors are employees of Cabun, and all travel into the community to provide care. The 

Clinic board in coordination with Area Health Education Council is planning to employ a 

full-time physician-educator from the University of Arkansas medical school to staff the 

clinic. The physician would then train residents in rural health care. 

How has the initiative aflected community health care needs? 

For the very poor, the Rural Health Clinic offered them an opportunity to receive


needed non-emergency health care locally. The Clinic provides reduced cost health care,


enabling access to poor people who would otherwise not be able to pay for private health


care. Since care is locally provided, children, elderly and people without transportation


no longer have to travel or rely on emergency ambulance services to obtain care.


Once the one-stop shopping center is complete, people in Lewisville will have access to a


full-range of social and health services. One short application form will make services


available to patients with fewer hassles to clients and enable providers to better


coordinate services.


Contact: Charles McGrew, Director, Section of Health Facility Services and Systems,


Arkansas Department of Health (501/661-2194).


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North Penal Oreille Health SeMces Consortium 

Metaline F- Washington 

W%at is the initiative? 

North Penal Oreille Health Services Consortium is a network of volunteer and 

professional primary health care providers from in and around North Penal Oreille 

county. 

U%at was the hospital like before it closed? 

Mt. Linton hospital in Metaline Falls, Washington closed in 1988 when the only physician 

moved out of town. It had 23 beds with an occupancy rate of 9.25 percent. Most 

residents received hospital care either by driving 100 miles to Spokane, or 50 miles to 

Newport. Upon closing, the hospital district became liable for unemployment insurance 

for the former employees and ran up a debt of $77,000, which still exists. 

The hospital was run by three locally elected Hospital Board commissioners. The Board 

receives a portion of the property taxes approximately $9,000 per year in this poor 

rural area. The Commissioners used tax revenue and donations from local companies to 

pay for insurance and heat to keep the building in good enough condition to reopen. In 

1992, four years after closure, the Hospital Board acknowledged that the hospital will not 

reopen. They surplused the building and are accepting bids from potential buyers. 

How was the successjid initiative developed? 

Community members formed a Committee after the hospital closed. Two Committee 

members attended a rural health conference and learned of a State grant program 

(Rural Health Care Systems Development) and the “community encourage” program. 

The pastor of a local church completed the grant application and the community 

subsequently received $57,000 from the State. The local Hospital Association paid for 

one Committee member to be trained to become a community encourage, which is 

basically a community organizer. The Hospital Association used some of the grant 

money to follow a planning process developed by Eastern Washington Office of Rural 

Health, Area Health Education Center (AHEC), and Washington State University. The 

planning process entails several steps. First, AHEC surveyed residents and analyzed 

community needs and resources. Then, the community convened a meeting to arrive at 

consensus on what health services they wanted and would support. The community 

decided its main goals were to get a physician and to obtain 24 hour emergency care. 

AHEC told them about a Federal Office of Rural Health Policy Outreach grant. The 

same pastor completed an application and the community subsequently received $267,000 

for the first year of a 3-year grant. By following the planning process, developed by 

AHEC, the community established the basic structure of linkages among providers that 

enabled them to meet the requirements to obtain the Federal grant. The Hospital 

Association, after years of efforts, successfully recruited a physician in July 1992. 

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W4at services does the initiative provide? 

The Consortium provides primary care to the community through a clinic, staffed with a 

physician, one physician assistant, and three part-time health care assistants who are 

licensed by the State. ~eclinic isopen5days aweekand thephysician protides after 

hours coverage for life threatening emergencies. The clinic has a referral agreement with 

a group of physicians 50 miles away for specialty services. The Consortium also employs 

a community health worker who assesses client health and human service needs and 

makes referrals using the Consortium’s health resource inventory and an 800 line. A 

nearby rural health clinic provider is helping the clinic set up a pharmacy. 

The Consortium also supports emergency care. They have a volunteer 911 system, 

staffed by the clinic during the work day and five volunteer households on rotating 16-

hour shifts at all other times. The community also has an all volunteer first response unit 

with EMTs, Advanced Life Support (ALS) and High Angle Rescue and Dive Team. In 

addition, they have an all volunteer ambulance service staffed with EMT and ALS 

personnel. The Consortium paid for EMT training and upgrading ambulance equipment. 

The Consortium has an agreement with the nearest hospital in Newport to provide 

telephone consultation for (1) 911 operators, (2) emergency room care, and (3) inpatient 

care. A nearby health care provider has agreed to expand home health services to serve 

the Metaline Falls community. The county mental health department will hire two 

psychiatric nurse practitioners to serve four counties in the area. A third organization, 

Rural Resources, used Consortium funds to help buy and operate a handicapped van to 

provide transportation. The Consortium has a continuing relationship with AHEC for 

planning and evaluation. 

How has the initiative aflected community health care needs? 

Residents are very happy to finally have a physician. Part of the Consortium grant of 

$267,000 pays the physician’s salary for now since the clinic’s income is not yet sufficient 

to support him. In addition, the consortium provides for more and different types of 

care beyond what the physician provides. The Consortium has enabled better emergency 

care and more primary care, and it provides some types of care that were previously 

unavailable, such as home health care and mental health care. Although many residents 

still would like a place where people could stay overnight for medical observation, such 

as a Medical Assistance Facility, many feel the Consortium is a satisfactory adaptation to 

not having a hospital. The Consortium anticipates that by the time the grant funds are 

exhausted, the clinic will have regained enough patients to be self-supporting. 

Contact: Kathy Grass, Director, North Penal Oreille Health Services Consortium, Ione, 

Washington (509/442-3514). 

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Oxford Medical Center 

Oxfor@ Nebraska 

JWtat k the initiative? 

The initiative is a primaxy care clinic staffed by a physician assistant and owned by a 

general acute care hospital in Cambridge, Nebraska, 30 miles away. The clinic is housed 

in part of the closed hospital building. It is one of five satellite clinics operated by the 

Cambridge hospital. The Oxford clinic hours are 9:00 am to noon and 1:00 to 5:00 pm 

Monday through Friday, except Wednesday afternoons, when it is closed. It is a licensed 

independently certified provider-based rural health clinic. 

What was the hospital like before it closed? 

The closed hospital, Fritzer Memorial Hospital and Health Center, was built in the 

1920’s. In 1987 the Fritzer Foundation gave the hospital to the city of Oxford. During 

the 1980’s the financial condition of the hospital deteriorated due to problems of 

physician availability and a declining occupancy. 

During approximately the last decade the hospital was open, it was staffed by one 

medical doctor (MD), except for very brief periods when a second MD was employed. 

One physician assistant was also employed the last two years, 1988 and 1989. The sole 

MD had gradually narrowed her practice to geriatrics, so younger patients seeking 

OB/GYN and/or pediatric services had to go elsewhere. Some community members 

assert that people had begun to migrate to Holdrege several decades earlier. Holdrege is 

21 miles away, and it offered a wider variety of both shopping facilities and medical 

services. 

In 1988 the one MD at the hospital was sanctioned by the Peer Review Organization 

(PRO), and could no longer seine Medicare and Medicaid patients. Since this sanction 

eliminated most of her patients, the physician tendered her resignation, effective January 

1, 1990. A temporary physician, who was recruited after the long-term physician left, and 

the physician assistant staffed the hospital until December 8, 1989 when inpatient services 

were terminated. 

People in the community exerted extraordinary efforts to save the hospital. They passed 

two bond issues totaling over a half million dollars, developed a system of “Keno” (a legal 

form of gambling), and held auctions and bake sales to raise funds. The unabated 

decline in occupancy, however, made it impossible to keep the hospital open. 

How was the successji.d initiative developed? 

Several years prior to the hospital closure the CEO from the hospital in Cambridge had 

begun to foster relationships with people in Oxford. He knew the Oxford hospital was 

having a difficult time, and wanted the people in Oxford to know that the Cambridge 

hospital was willing to try to help, if they wanted them to do so. Late in 1989 when the 

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--

Board at Oxford saw that closure was unavoidable, they approached several nearby 

hospitals toaskwhat each could dotohelp maintain health care. Only the hospital in 

Cambridge responded with anoffer toopen aclinic, initiallyon a90-day trial basis. 

Three physicians from the Cambridge hospital provided health care from the time the 

hospital closed, until the clinic opened on Januaxy3, 1990, and until afull-time physician 

assistant was hired in July 1990. Those three physicians each still work at the clinic one 

afternoon a week. 

The newspaper in Oxford supported the transition of the former hospital to a primary 

care clinic by publishing articles about the new clinic. Medical and non-medical staff 

from the Cambridge hospital spoke to groups at meetings in Oxford to express their 

commitment to the clinic. Influential citizens in Oxford openly supported the clinic and 

encouraged people to use it. 

What services does the initiative provide? 

The clinic offers general family practice services. Specifically it offers prenatal care, 

physician assistant care, laboratory and x-ray services, urgent care during business hours 

and on an on-call basis after hours, emergency transportation services through a 

volunteer EMT service and helicopter transport to nearby hospitals, well-child services, 

family planning services, vision and hearing screening for school and employment, 

nutrition education, EKG, health education sefices, and a pharmacy. 

How has the initiative affected community health care needs? 

When the hospital closed the community was generally in a state of despair. Now the 

community in general is happy and appreciative of what they have. Many believe the 

clinic health care is far more reliable and varied than that previously offered by the 

former hospital. The clinic has preserved a system of primary care and emergency care 

in the community, made Medicare- and Medicaid-reimbursed services available again, 

brought people back to the business section of town, preserved professional and technical 

level jobs, saved the only pharmacy in town from closing, and made access to care better. 

The addition of a “handibus” which runs between Oxford and Cambridge on Tuesdays 

has improved access to hospital services particularly for the elderly and the poor. The 

initiative has helped to erode a strong sense of rivalry between the two towns and 

enlarged the concept of what a “community” is. 

The Cambridge hospital continues efforts to recruit a full-time medical doctor to staff the 

Oxford clinic and hopes to broaden their services further with the addition of specialists. 

Contact: Jim Naeve, CEO, Cambridge Memorial Hospital and Medical Center, 

Cambridge, Nebraska (308/697-3329). 

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Jane Phillips Community Health Clinic 

Caney, Kansas 

W%atis the initiative? 

In Caney, Kansas (population 2,300) the former acute care hospital is now a doctors’ 

clinic and a 10 bed long-term care facility. The clinic is a satellite of a large regional 

health center, Jane Phillips Episcopal Memorial Medical Center in Bartlesville, 

Oklahoma, just 18 miles away. 

W+at was the hospital like before it closed? 

The hospital was staffed to provide 24-bed in-patient acute care, 24-hour emergency care, 

x-ray and clinical lab services. 

Caney hospital served a community with a large number of elderly people. In the years 

preceding closure, the Medicare use rate ranged between 40 and 60 percent, once going 

as high as 78 percent. 

Fewpeople were using the hospital. Ithadan occupancy rate of about 25 percent prior 

to closing. From 1981to 1988 annual patient admissions declined from 521 to 217. 

During the last two years of its existence as an acute care facility, the Caney hospital was 

dependent on fundraisers and private donations to continue operations. As one board 

member of the former hospital said, “You can’t tax enough to keep a rural hospital in 

business.” 

How was the successful initiative developed? 

The vision and initial groundwork for the initiative was provided by the administrator of 

the former hospital. Many communities undertake ill-advised yet understandable 

refinancing measures in order to ensure their hospitals stay open. However, Caney, 

having struggled to keep their hospital afloat, was primed to accept another means of 

care. The administrator responded to evidence of impending financial insolvency by 

identi&ing options, which included recognizing health care system support being provided 

by the Jane Phillips Episcopal Memorial Medical Center in Bartlesville, Oklahoma. 

In fact, the Jane Phillips story is the real story here. It was already providing a variety of 

support semices as a hub for several other formerly independent community health care 

facilities. Included in these are hospitals in Pawhuska, Oklahoma and Sedan, Kansas. A 

third hospital in Nowata, Oklahoma presently serves as a drug and alcohol rehabilitation 

facility. In addition, two other satellite physician clinics in Barnsdahl and Ramona, 

Oklahoma complete the regional picture. In each case the facility facing closure 

approached Phillips Hospital for support ranging from management services to direct 

financial aid. In each case, Phillips responded by providing the appropriate level of 

support to maintain the health care service or some altered type of service. 

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While this is not a formal EACH/RPCH demonstration, the model which Jane phillips 

pioneered in the region is very similar. The major hospital at the hub is surrounded by a 

number of other limited health programs. One important difference is that in the Caney 

instance the health community served crosses State lines which EACH/RpCH prohibits. 

Foresight and careful planning allowed the Caney Hospital to close as an acute care 

facility one Friday and open on the following Monday as a Jane Phillips 24-hour doctors’ 

health clinic and long-term care facility. 

J-Watservices does the initiative provide? 

The Caney facility provides offices for three physicians, lab services, and an optician’s 

office. At the time of our site visit, September 1992, Caney was preparing to house its 

remaining pharmacy in the same complex with the clinic. The clinic also serves the 

community of Caney and the immediately surrounding rural area with 24-hour urgent 

care and emergency transportation services to Jane Phillips Hospital in Bartlesville, 

Oklahoma. 

At the time of our visit, Caney had two practicing physicians. Negotiation to obtain a 

third practicing physician for the community was almost completed. The former hospital 

also employed the services of a physician assistant on a part-time basis. With lab semices 

on site and access to more advanced diagnostics at the Phillips hospital, the arrangement 

meets community needs. Physicians shared a waiting room and reception services. Each 

had a private office and several patient treatment rooms. Each also had privileges at 

Phillips hospital. 

The clinic was in the process of becoming a focal point in town for all health services 

except dentistry. An optician had recently moved offices into the facility and a pharmacy 

was also preparing to do so. The clinic also has the ability to transport patients with 

both a helipad and an ambulance available for cases requiring stabilization and transport. 

How has the initiative affected community health care neeak? 

The implications for one-stop health care are obvious. With the convenience offered 

here, buoyed by the capability of Phillips to provide more sophisticated medical services, 

the initiative is meeting Caney health care needs better than the original hospital. In 

fact, the transition to the clinic concept was so smooth that most citizens we contacted 

expressed a belief that it is still a hospital with more services. While the former hospital 

was underused, the clinic now has a waiting list of patients wanting health care service. 

Contact: Catherine H. Abrams, Vice President for Regional Development, Jane Phillips 

Episcopal Memorial Medical Center, Bartlesville, Oklahoma (918/333-7200 Ext. 748). 

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Medical Assistance Facilities 

Circle, Ekala@ Jorckq and Terry, Montana 

What is the initiative? 

A Medical Assistance Facility (MAF) offers low intensity inpatient care, 24-hour 

emergency care, and basic outpatient medical services. As designed under Montana law, 

a MAF must be in a county with a population density of no more than six residents per 

square mile. Further, it must be located more than 35 miles from the nearest hospital. 

MAFs operate without meeting the same licensing requirements as hospitals. In MAl?s, 

care may be provided by physician assistants or nurse practitioners, with a supervising 

physician visiting the MAF once every 30 days. The MAF does not need to be staffed 

24-hours a day unless a patient is in the facility. Only one MAF staff member must be 

on duty or on call at all times. Patients may receive up to four days of inpatient care in 

a MAF. However, patients with serious illnesses or injuries are stabilized at the MAF 

and transported to a full-service hospital. 

W+at was the hospital like before it closed? 

At the time of our review, four Montana communities had MAFs. They are Circle, 

Ekalaka, Jordan, and Terry. All four of the community hospitals had low occupancy 

rates. Most of the hospitals had scaled back services. None of the four hospitals 

provided specialty care. Finally, most surgeries and obstetrical services were 

discontinued. 

How was the successful initiative developed? 

Unlike other communities with successful initiatives, the four Montana communities were 

invited to participate in the MAF project. Early in the 1980’s, the governor of Montana 

created a task force to study the future of rural hospitals. The task force determined 

many rural communities could not continue to support a full-service hospital, yet 

communities needed access to primary and emergency care. In 1987, the Montana State 

legislature authorized the MAF program. This program was designed to provide 

continued access to health care by converting a full-sefice hospital into a low-intensity, 

short-stay health care service center. 

In 1988, the Montana MAF program received planning and development funding through 

a Health Care Financing Administration (HCFA) demonstration grant. Also, HCFA 

waived numerous hospital requirements so that MAFs could receive Medicare 

reimbursement. In 1990, HCFA authorized a cost-based reimbursement system for 

MAFs. HCFA also established quality assurance, utilization review and certification, and 

life safety standards for MAFs. 

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W%atservices does the initiative provide? 

MAFs provide up to 96 hours of inpatient acute care, 24-hour emergency services, 

stabilization and transfer services for severe cases, basic lab services and basic x-ray 

services. All MAFs also offer outpatient medical service, and are collocated with nursing 

homes. Each MAF may offer other services based on the needs and resources of the 

community. 

How has the initiative affected community health care needs? 

MAFs meet most of the health care needs of a community. With the combination of 24-

hour emergency care and limited inpatient care, MAFs are providing basically the same 

care as that provided by the former hospital. Providers at the MAF are performing only 

limited and clearly defined services which they are fully equipped and trained to handle. 

When patients need care that is not available at a MAF, the MAFs transfer them to a 

facility that can provide the needed care. 

Contact: Keith McCarty, Director, Montana Hospital Research and Education 

Foundation (406/442-8802). 

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