Rural Critical Care Access Hospitals Could Get Hit

Health care services across the country are expecting to be slammed if the congressional debt-reduction super committee makes its deadline and submits a plan to reduce the federal deficit by Wednesday, but rural California could take a particularly big hit, according to a Washington, D.C., policy expert who spoke in Sacramento yesterday.

In addition to Medicare reimbursement rate cuts, other reduction proposals have included eliminating all rural hospital payment programs, according to David Lee, a governmental affairs expert for the National Rural Health Association.

“There are a number of possible cuts that directly affect rural health care, but this one — that all rural hospital payment programs could be abolished – has come up over and over again,” Lee said, addressing the annual conference of the California State Rural Health Association.

Those cuts could severely affect critical care access hospitals in rural areas of California — places where those services are not offered anywhere else, Lee said. Federal legislators are aware of the negative repercussions, he said, but they continue to flirt with the idea.

“One of the things we’re concerned about is that, even within the report on potential drawbacks, they say many of these rural hospitals might have to cut services or go out of business,” Lee said. “And yet they’re still willing to go forward with it.”

At this point, he said, no one really knows what the super committee will do next week. “Committees are notoriously loose with leaking information, but that hasn’t happened here,” Lee said. “No one really knows what’s being proposed, exactly. But this one, you hear it a lot.”

To save an estimated $62.2 billion over 10 years, the federal government could eliminate rural funding such as the MDH (Medicare Dependent Hospital) and CAH (Critical Access Hospital) programs.

“In other proposals, the House [of Representatives] leadership included $16 billion in specific rural cuts,” Lee said. “We think that proposal may have been agreed on prior to passage of the [Balanced Budget Amendment].”

There has been talk of capping dual eligible payments, reducing post-acute care such as skilled nursing facilities — the number of proposals that could hit rural America, and California, are staggering, Lee said.

“The President came out with a specific proposal earlier this year, where the two big items were reducing CAH reimbursement, and ending CAH reimbursement for facilities 10 miles or less from another hospital,” he said. “It’s about $6 billion in savings, which relative to the other proposals, it’s not large, but as a precedent-setter it’s very concerning.”

If the super committee fails to agree on a plan, the det reduction process moves into sequestration that triggers automatic across-the-board cuts in a number of programs, including Medicare and other health care services.

Steve Barrow, executive director of the CSRHA, said rural California depends on medical services for more than individual health. Rural health care affects  the health of the community, as well, he said yesterday.

“About 11% of all employment in rural areas is health care,” Barrow said. “The average critical care access hospital means about 100 jobs.”

Losing those hospitals would be devastating and wouldn’t save any money, he said.

“In rural areas, there is nothing else. By cutting critical care access hospitals, health care costs actually will go up. So if you’re trying to cut money, then it doesn’t work, and the legislators [in Washington], they need to hear that,” Barrow said.

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