Facilitating Change. Preserving Access.

Why is crisis the only facilitator of change in U.S. Healthcare?

Does anyone remember a time when being a “doctor/physician” was an individual declaration? Prior to the Flexner Report in 1910, many medical “practitioners” were self-appointed and promoted elixirs, potions, leach applications, and other supposed cures as part of their individual “practices”. The Flexner Report, written by Abraham Flexner, a social worker from Louisville, Kentucky, set in motion a nationwide effort to standardize medical education and license the practice of medicine and surgery; a foundation that is continually built upon, today.

Does anyone remember what elderly, disabled and poor people did for healthcare in the U.S. prior to 1964? In the years preceding Title XVIII and XIX (Medicare and Medicaid), the burden of care for these demographic groups fell on healthcare providers, charity, and the capacity of those individuals to pay, personally. The advances in medical care and treatment were having a significant impact on median survival age for both genders by dramatically reducing acute illness as a primary cause of death. With these breakthroughs, the emergence of chronic illness (cancer, stroke, heart disease, diabetes, COPD, etc) as a major source of morbidity (illness) that disproportionately impacted the aged, disabled, and poor among us and inordinately burdened the healthcare system.

Fast forward to today and another crisis is upon us in the healthcare system. This one appears to be self-inflicted by the changes in the payment (reimbursement) system and the technological breakthroughs that have, rightly, reduced inpatient length of stay and moved a significant amount of care and treatment into the ambulatory arena. The evolution of healthcare delivery brought about by these changes has inordinately impacted rural healthcare.

Back in the 1950s, the Hill-Burton Act provided long term, low interest loans to cities and towns for the development of hospitals to improve access to care. While healthcare continued to be reimbursed on a fee-for-service (FFS) or per patient day (PPD) basis, rural hospitals flourished, for the most part. With the advent of the Prospective Payment System (PPS) in 1984, the paradigm changed. Census (heads in a bed) was no longer a determinant of operational solvency. In actuality, quite the opposite.

Hospitals in rural America were forced to retool, develop robust ambulatory programs, get access, through acquisition or affiliation, to post-acute services as acute care convalescence was no longer reimbursed. Some rural hospitals had the foresight and financial ability to restructure their existing physical plants or build completely new facilities in response to the changes in healthcare delivery. However, the majority of rural hospitals were saddled with aging physical plants, built in the Hill-Burton era, and dwindling financial resources as the government contracted with commercial insurance providers to manage significant portions of Medicare and Medicaid and reimbursements continue to be tightened. Even with the relatively new hospital designation of Critical Access (CAH) which reverts reimbursement to “cost basis”, operational solvency is only mildly improved in most cases.

Today, with the pandemic in full bloom, more than half of rural hospitals are operating with negative margins and will endure further stressors that will accelerate the “tipping point” to insolvency and potential closure. Large, rural hospital systems like Community Health Systems (CHS) and Quorum Health Resources have been vigorously divesting hospital assets or declaring Chapter 11 bankruptcy in an effort to find financial stability in these troubling times.

So, in a time when healthcare services may be needed more than ever, access to those services will be diminishing at an ever-increasing rate in rural America. We must re-imagine what services are critical to health maintenance in rural America and undertake a restructuring that preserves access to those critical services with effective medical transport to larger centers.