Alabama Administrative Code › Title 410 - STATE HEALTH PLANNING AND DEVELOPMENT AGENCY › Chapter 410-2-2 - HEALTH PRIORITIES › Section 410-2-2-.04 - Rural Health Care

Current through Register Vol. 42, No. 9, June 28, 2024
Alabama has a Rural Health Plan developed with the assistance
				of the Alabama Department of Public Health's Office of Primary Care and Rural
				Health, the Alabama Hospital Association, and rural hospitals. The current
				State Rural Health Plan, published in 2008, was updated in both 2011 and
				2016[1]. This plan is incorporated into this State
				Health Plan by reference hereto.
(1)
The Problem
Rural healthcare providers disproportionately serve individuals
				who are older, sicker, poorer and underinsured/ uninsured as compared to people
				living in other parts of Alabama. Alabama's uninsured rate (19-64 years) is
				15.8%[2]. Policy makers anticipated a rate less than
				10% after passage of the Affordable Care Act, but the take up in the Alabama
				Marketplace/Exchange is only 3%. Rural Alabamians (as well as Americans on the
				whole) often lack adequate primary care access and have higher rates of
				diabetes, heart disease, cancer, obesity, tobacco/opioid use, mental health
				issues and stroke[3]. The health issues plaguing
				rural Alabamians stress a fragile rural delivery system dealing with lower
				volumes, rising costs, increased regulations, lower negotiating power and a
				shortage of healthcare workers. As rural Alabama changes and evolves, so too
				must rural healthcare delivery in the state. The issues facing Alabama's rural
				care providers are multi-faceted:
(a)
			 Reimbursement and Operational Factors. As a rule, providers in rural areas
			 experience a higher mix of Medicare/Medicaid patients than do the facilities in
			 urban areas; but rural hospitals receive a lower amount of reimbursement per
			 patient from Medicare. Rural providers must have robust volume to thrive. But
			 the healthcare system is shifting away from an inpatient-dominant and
			 volume-driven system and consequently the state's rural delivery system is
			 becoming increasingly brittle. To counter the loss in volume, many rural
			 providers expand their service offerings which is often not ideal because
			 quality is correlated to volume in certain
			 specialties[4].
As healthcare shifts from volume-based reimbursement to a
				system based predominately on value, rural providers will continue to struggle
				if payors do not make a distinction between the unique operating context of a
				rural hospital and that of suburban and urban providers. Even when a
				distinction is made, oftentimes it is deleterious to the provider. For example,
				the Centers for Medicare and Medicaid Services (CMS) implementation of the
				Prospective Payment System (PPS) assumes hospitals in rural areas will not
				experience the same labor costs for health personnel services as do urban
				hospitals. Therefore, the component parts of the prospective payment formula
				provide for a lower wage allowance for rural hospitals. Another factor that
				tends to limit reimbursement for rural hospitals is that the PPS system assigns
				weights related to patient attributes to each diagnosis-related group (DRG).
				The higher the weight per DRG, the more reimbursement a hospital will receive
				if that hospital provides services to patients with higher weighted/ reimbursed
				DRGs. Therefore, urban facilities may receive more reimbursement, although the
				weight assignment per DRG has not been proven as an accurate indicator of the
				consumption of resources. The bottom line effect of Medicare reimbursement on
				rural hospitals is the payment rates are generally less for hospitals in rural
				areas, leading to a less than adequate payment system. According to the Alabama
				Hospital Association, in recent years approximately eighty-eight percent (88%)
				of rural hospitals in the state experienced a net operating loss.
(b) Demographic Factors. A low
			 population density, worsened by the emigration of the younger population in
			 search of employment in larger communities, results in a high proportion of the
			 elderly and underinsured/uninsured remaining in rural communities. Alabama's
			 overall population density in 2019 averaged 94.4 people per square mile,
			 ranging from a low of 12.5 persons per square mile in Wilcox County to a high
			 of 586.2 persons per square mile in Jefferson County. In this case a
			 measurement of density may not be an accurate indicator as only 18 counties
			 have a density factor equal to or above the average and 49 counties below the
			 average. Rural facilities thus have a smaller market from which to draw
			 patients and fewer patients who pay adequately as compared to the costs of
			 providing the care. According to the Centers for Medicare and Medicaid
			 Services, in 2014 health care spending per capita for the 65 and older
			 population was over five times higher than health care spending for children,
			 and almost three times higher than for working-age
			 adults[5]. The population 65 and older comprises
			 16.9% of the state population and 19.2% for the 49 rural counties, further
			 emphasizing the need to develop and implement a rural health
			 plan[6]. In addition, rural Alabama has a high
			 percentage of Veterans and a low percentage of commercially insured
			 residents.
(c) Utilization Factors.
			 Overall use of inpatient services in rural areas continues to decline, while
			 those same services are increasingly used by the elderly who are covered by
			 decreasing Medicare reimbursement. Given that many of the rural hospitals are
			 sole community providers, the leading industry in the community, and one of the
			 major employers in the area, the decreasing use has caused concerns both
			 economically and politically. Leaders are rightly concerned that the demise of
			 the rural hospital leaves a discontinuity of health care services for citizens
			 in their areas.
(d) Insufficient
			 Health Professional Supply. Data from the Alabama Department of Public Health
			 indicates that every county in the state has at least some areas considered to
			 be medically underserved, with fifty-eight (58) counties shown as completely
			 medically underserved. While Alabama has made strides in licensure portability
			 in recent years, there are still barriers to address, including portability
			 within telehealth. Because of the problems attracting specialized professionals
			 and obtaining new technologies, few rural hospitals can provide special
			 services that might increase their revenue. The migration of young people to
			 urban communities, lack of adequate reimbursement, and limited patient
			 resources are other problems hindering the recruitment of professional
			 personnel and fueling the state's health professional shortages. Government
			 reports show that Alabama, like many other parts of the South, is experiencing
			 a physician shortage.
Children living in rural areas have less access to routine
				primary care and, if they have a chronic condition or medically complex
				diagnosis, must drive long distances to urban centers for care. Many rural
				emergency rooms are not equipped for pediatric care, and those cases are often
				transferred to regional hospitals. In addition, much of the rural emergency
				care is through a volunteer EMS system, which could be enhanced.
Utilization of nurse practitioners, physician assistants, and
				nurse midwives meets a real need in addressing the access problem faced by many
				rural Alabamians. Health planners, providers, policy makers, and communities
				must approach the recruitment and retention of non-physician health
				professionals realistically. It is unrealistic to assume that every rural
				community will be able to recruit and retain a physician. In order to provide
				access to health care for the citizens of many of the state's most rural areas,
				the utilization of non-physician health professionals must be seriously
				encouraged. Also, payment for services provided by these non-physician health
				professionals must be made by third party payors and self-insured programs in
				order for their numbers to increase.
(e) No one strategy will solve the state's
			 problems with rural health care. Rural healthcare delivery must evolve and the
			 state must focus on appropriate and adequate access but untether from the idea
			 of access equals an inpatient hospital.