Funding a Problem for Rural Healthcare

Access to healthcare is a challenge throughout rural America. Though many rural areas have small hospitals and clinics, more specialized services are hard to find.

“Only about ten percent of physicians practice in rural America despite the fact that nearly one-fourth of the population lives in these areas,” according to the National Rural Health Association (NRHA). Additionally, the number of specialists serving rural areas is nearly 70 percent lower than urban.

Travel distance makes it difficult for rural residents to receive recommended, life-saving screenings, particularly for low-income individuals, which make up a larger part of the rural population. For example, rural residents with disabilities are at a higher risk of being diagnosed with late-stage cancer than those in urban areas because less receive important colorectal cancer screenings, according to NY Daily News.

Many rural health providers are struggling. Forty-three rural hospitals have closed since the start of 2010, according to USA Today, making it hard for nearby residents to receive even basic care.

A major factor in the closings is low Medicare and Medicaid reimbursements. Rural residents have lower average incomes and a higher percentage are insured through the government programs, which do not adequately reimburse hospitals for the actual cost of care, according to Mt. Grant General Hospital CEO Richard Munger. Serving Hawthorne, Nev. and the greater Mineral County area (population 4,500), Mt. Grant receives from Medicaid about 40 percent of what it costs to provide care.

“It’s kind of difficult when you are only getting 40 cents of your costs for the services you provide,” Munger said.

The hospital fares better with Medicare, receiving its costs plus one percent. “At least we get our costs back,” he said but added, “One percent isn’t much of a margin.”

If financing can be fixed, there are opportunities to improve rural healthcare. One game changer is telemedicine. This tool allows patients to have consultations at their local hospitals or clinics with out-of-town specialists through video conferencing technology.

For patients dealing with depression, addiction and other mental health issues, they can receive much of their treatment without traveling. Even for issues that require in-person visits, initial consults can be done through telemedicine and often recommendations by the specialist can be administered by the local, primary physician, saving the patient hours of travel.

It doesn’t come cheap. Hospitals and clinics need funding to not only purchase the technology but pay staff members to run it. In Hawthorne, Mt. Grant needs federal grant money before it can begin. The hospital can pay the $15,000 to $24,000 for equipment. However, Medicare only reimburses the originating site (the rural provider) $29 – far short of what it takes to pay staff. “They’ll pay the specialists their fees, but they only reimburse us 29 bucks,” said Munger. “I can’t have a doctor for an hour presenting a case, or even a PA or nurse for $29.”

Munger is hoping to have an answer on the grant funding in early 2015. If awarded, the hospital will start connecting patients to dozens of specialists primarily from Reno – 138 miles away. “If we get that I think it’s going to help bridge that access, because it is difficult to get specialists to come out here,” Munger said.

Telemedicine can potentially save lives. A three-way partnership with Renown, University of Nevada School Medicine and Northern Nevada Medical Center is ready to offer “telestroke” services for Mt. Grant. Telestroke allows doctors with advanced training in the nervous system to evaluate stroke victims quickly and make diagnoses and treatment recommendations that can be administered by the local doctors.

“We don’t have a lot of strokes, but when you do it’s very important,” Munger said. “Time is of the essence.”

In White Pine County, Nevada (population 10,030) telemedicine is already underway. William Bee Ririe Hospital in Ely offers telestroke through the University of Utah, according to CEO Matt Walker. Much of the service, which includes a separate video monitor, was funded by a private donor and the rest by the hospital. Local patients can also visit with an out-of-town nephrologist (kidney doctor) through an iPad. This service is also paid for with hospital funds.

“I do think that we will continue to increase our services in [telemedicine],” Walker said. “It’s a lot easier for a specialist to just log in instead of having to drive out here.”

Driving out to rural areas has long been a tough sell, and administrators are continually working at it. “They’re just too busy and there’s not enough of them,” Munger said. “If you look at their side, if they have to spend five hours driving out here and back, that’s five hours they could have spent in Reno seeing their patients.”

There are success stories. Mt. Grant now has a neurosurgeon that visits. But the other challenge is keeping them coming. “We had one guy that traveled out here a few months, and then, again, the economics of it, they stay in Reno,” Munger said.

Ely brings in a variety of specialists on a rotating schedule each month, though Walker admits they aren’t easy to find. Beyond the travel headaches, he feels the rural hospital environment is different than what most doctors train for.

In a large hospital, a doctor can rely on other specialists when a “case goes sour,” he said. “But when you’re out here so rural, you might be the only specialist that’s there, and so a lot of specialists don’t want to come out to these areas because they’re too scared.”

If more medical students would train in a rural environment, they would be able to “understand that that’s how it is, and it’s ok,” Walker said. “I think there would be less apprehension, and I think that’s a big part of the problem with physicians coming out rural.”

Despite these difficulties, Walker believes the majority of healthcare needs in his area are met. Visiting physicians’ schedules are advertised in the newspaper and they are typically booked when they come. The main drawback is during emergencies.

“Any sort of emergency, if [the needed specialists] are there that’s great, but oftentimes they’re not,” Walker said. “So for emergency cases we’re not adequately staffed obviously and so we have to send them to wherever the specialist is.”

In Hawthorne, Munger says he is optimistic about the future of rural healthcare, though he added a lot of it hinges on fixing funding. He has been Mt. Grant’s administrator since 1980 and remembers a time when they had a fully-staffed mental health unit. That is no more due to lack of money, but the need for mental health services in the area has not gone away. Drugs, alcohol addiction are serious problems, but new patients have a four-week wait to see the local psychologist.

In Ely, Walker sees the reimbursement amount from Medicare and Medicaid continuing to go down, while the quality requirements placed on hospitals in order to be reimbursed are becoming tougher.

“Healthcare facilities work on a pretty small margin anyway, but when they continue to cut [reimbursements], especially when a disproportionate share is Medicare and Medicaid, we take a big hit.”

Ben Rowley is a small business owner living in Rural Nevada and is the web editor for Battle Born Media’s publications. His writing focuses on issues related to rural business. You can reach Ben by visiting www.nvcmedia.com, or find him on Twitter @benrowley.