CAH's past and future

Designation 'is safe for the short term'

SUBLETTE COUNTY – In the face of declining tax revenue and dwindling reserves, the Sublette County Rural Health Care District (RHCD) has been campaigning for a critical access hospital (CAH) designation for more than two years.

Under the CAH’s current model, the RHCD points to a three-fold increase in reimbursement from the Centers for Medicare and Medicaid Services (CMS), which would help the district plug the holes of a budget that’s currently losing about $3.5 million a year. The RHCD made budget cuts last year – including the termination of after-hour emergency care in Marbleton and the end to Saturday hours at both clinics – that softened the hit to reserves, which currently sit at just under $8 million.

But proponents of the CAH insist that the designation is the only way to stop the fiscal bleeding and help the district break even.

“The critical access hospital is an important tool to preserve rural health care,” explained Brock Slabach, senior vice president at the National Rural Health Association (NRHA), a nonprofit organization promoting the welfare of rural health care.

CAH history

The CAH program was officially created in 1997 by the Balanced Budget Act (BBA) as a federal measure to bolster rural health care facilities, which faced a dangerous increase in closures in the late ’80s and early ’90s.

The BBA legislation established the original framework of a CAH, including the distance to another hospital (more than 35 miles), the number of inpatient care beds (no more than 15), limits on the length of patient stay (96 hours), and a 24-hour emergency-care requirement.

In 1999, the Balance Budget Refinement Act was passed and refined some of the original stipulations, including changes to billing, eligibility and patient-stay requirements.

A year later, former President Bill Clinton signed the Medicare, Medicaid and SCHIP Benefits Improvement and Protection Act into law, which further improved funding for the CAH program. According to the American Hospital Association, the changes “represented a restoration to (CAH) hospitals of $350 million over five years.”

In December 2003, former President George W. Bush further enhanced reimbursement with the Medicare Prescription Drug, Improvement, and Modernization Act, which also expanded the flexibility for the number of beds in the CAH. This act also established CMA reimbursement at 101 percent.

Since then, that reimbursement policy has seen nominal decreases in recent years.

In 2011, there was a 2 percent sequestration on all Medicare spending through the Budget Control Act, which took effect in 2013.

Also in 2013, CMS dropped its reimbursement on “bad debt” down to 65 percent, further eroding the policy of 101-percent reimbursement.

“So between those two changes, it has basically moved the cost reimbursement to be less than 100 percent now,” Slabach explained.

Present and future challenges

With a change in the presidential administration, the questions concerning the CAH now center on what the future holds.

President Donald Trump has made it clear that he wants to do away with the Affordable Care Act (ACA) – or Obamacare – during his tenure. For the NHRA, that wouldn’t necessarily be a devastating move.

“We have found that, basically, most of the rural offerings (in the ACA) have been meager,” Slabach said, adding that it doesn’t mean the CAH model can’t be enhanced. “Obviously, we think there’s some improvements that can be made to it.”

The NRHA is currently pushing national legislators to move ahead with the Favorable Hospital Act, which “will hopefully be introduced soon and it includes the reversal of some of those (lowered reimbursement) programs we talked about,” Slabach said.

And when it comes to Trump, the NRHA sees rural communities as a priority for the new administration.

“We feel that President Trump was elected largely due to the high percentage of votes from the rural communities across the U.S.,” Slabach said. “And we feel there’s an important part of the American economy in these rural areas – food and fuel.”

The Wyoming Delegation of Sen. John Barrasso (R-Wyo.), Sen. Mike Enzi (R-Wyo.) and Rep. Liz Cheney (R-Wyo.) echoed Slabach’s sentiment and their own support for rural health care in general and protection of the CAH program, in particular.

“As co-chairman of the Senate Rural Health Caucus, I work with members of both parties to improve rural medicine,” Barrasso said in a statement to the Examiner. “In particular, I strongly support the critical access hospital program because it helps make sure that patients in Wyoming receive the care they need.”

“Access to affordable health care is one of the biggest challenges facing our state,” Cheney said in a statement to the Examiner. “I am committed to finding ways to improve access and quality of our healthcare system while we lower costs, so that Wyomingites can receive the medical care they need, closer to home. We need to put patients and their families back in the driver’s seat. As a vitally important part of our system, I strongly support the Critical Access Hospital Program and will work to protect it and ensure its continued availability to Wyoming.”

“Sen. Enzi has supported critical access hospitals (CAHs) and values the important role they play in our rural and frontier communities,” said Max D’Onofrio, press secretary for Enzi. “As Congress continues to work on health care reform, he always emphasizes to his colleagues the unique challenges that rural communities face in delivering health care services to patients.

Both Barrasso and Enzi pointed to policies that were pushed by the Obama administration that would have further reduced payments to CAH facilities – policies both of them fought.

“This work is especially important right now, since – according to the National Rural Health Association – more than 75 rural hospitals have closed since 2010,” Barrasso said. “In addition, proposals were previously put forward to reduce funding for critical access hospitals. For example, former President Obama included reducing payments to these facilities in several of his budget requests. While these proposals were not enacted into law, I remain committed to protecting this program.” 

What Trump brings in his budget, however, remains to be seen.

“With the new administration, it is most likely that any proposal to funding changes related to CAH reimbursement would be seen in the president’s budget, or in the Medicare Inpatient Prospective Payment System rule from the Centers from Medicare and Medicaid Services,” D’Onofrio said. “But I couldn’t speculate on what their plans are.”

For the NRHA, a new model may be necessary in the long-term plan for rural health care.

“We need more innovation and more approaches to how rural communities can survive in their health care moving forward,” Slabach said, adding that the NRHA is looking to promote a new provider type – the community outpatient hospital – that “would sit between a clinic and a critical access hospital, focused on primary care and outpatient care.”

As for the freestanding emergency center – an option recently highlighted locally – Slabach said the model, which has been in place for years in other states, has not proven effective in many instances.

“The problem with the freestanding emergency department (is that it’s) not consistent with Medicare policy so you can’t get Medicare reimbursement for Medicare services,” Slabach said. “There is no provider type that matches … without the sponsorship of a tertiary facility.”

The result is that the costs often outweigh the benefits, according to Slabach, citing a push by the Georgia Legislature for freestanding clinics that ultimately went unfunded due to the associated price tag for the state.

In the meantime, the CAH has proven to be the best current option available in a scenario for communities like Sublette County, according to Slabach.

“I think the critical access hospital program is safe for the short term,” he said, while pointing to new ideas and solutions as well. “I don’t know that for the long-term – and I’m talking many years – I don’t know that it’s the solution. But for the interim, I think it’s definitely something communities should be looking at to maintain (rural health care).”


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